Publicis, Omnicom Set To Talk 'Integration' This Week
Publicis Groupe reported third quarter revenue results this morning, which company CEO Maurice Levy characterized as “in line with internal forecasts.” Levy also disclosed to analysts that an integration committee set up by the company and merger partner Omnicom would meet for the first time this week along with other company executives convening in Miami for get-to-know-you talks.
The Paris based holding company posted revenue of approximately $2.27 billion, up 3% with organic revenue growth of 3.5%, versus 2% in the third quarter of 2012. Levy reported the “good news” that the struggling European region showed an uptick of 0.4% organic growth. For the first nine months of the year organic growth was up 3.3%. The company didn’t report profits for either period.
The Publicis revenue report came just a day after its proposed merger partner reported Q3 financial results showing 4.1% organic growth for the period.
Like his counterpart at Omnicom, Levy confirmed that the two companies were having their first major meeting in Miami for four days starting Thursday. Levy confirmed that an integration committee that has been formed to help smooth the coming together of the two companies will also meet for the first time in Miami.
“We will try to get know each other and understand our cultures and processes and the way we work to start to build the process for integration,” Levy said the Miami meeting during a call with analysts to discuss Q3 results.
In an interview with European Business Media that was posted on the Publicis website Levy described the quarter’s revenue results as “on track.” He said the merger process was also progressing according to plan.
Asked to comment on the responses from competitors to the proposed merger Levy responded that they are “fighting it” because “they see all the potential this merger can bring. We’ll have the best operation in the world” in the advertising and marketing services arena, he said. “I understand that it can be a worry” for those that have to compete against the merged company.
While the companies have submitted applications for merger approval to most of the required regulatory bodies, Levy said that conversations with some of the more important agencies like the Federal Trade Commission in the U.S. and Europe’s EU “have just started.” But he added, “we don’t foresee any major hurdles.”
And so far, he said, there’s been no client fallout due to potential competitor conflicts.
For the company’s third quarter organic digital revenue growth was 12%, while organic analog revenue was down .8%. “As the analog market shrinks, our strategy of focusing development in the digital sector has continued to prove being right,” Levy said.
Levy said the company was sticking with guidance for full-year 2013 organic growth of 3.5% to 3.6% but sounded a note of caution for Q4 which is always harder to project given year-end concerns and profit issues of individual clients. He also noted the U.S. governmental shutdown and its potential to wreak havoc with the global economy.
“We are nonetheless confident about 2013,” Levy said, “and confident about the new page of history we will be writing with our merger” with Omnicom.