The Interpublic Group of Companies posted a 2.2% revenue increase for the first quarter of 2012 to just over $1.5 billion. The company narrowed its year-to-year net loss to $39.4 million from $45.3 million for the same period a year ago. Organic revenue growth, which excludes acquisitions and currency fluctuations, was up 2.8% for the quarter, which was roughly in line with the full-year guidance given by IPG earlier. It is also lower than competitors that have already reported first-quarter results. Omnicom Group, for example, said its first-quarter organic growth rose 5.1%, Publicis Groupe and Havas reported comparable growth of 4.1% and 3.5%, respectively. Interpublic Group CEO Michael Roth told analysts on a call to discuss results that the company is off to a “solid start” for 2012. He asserted that 2.8% organic growth was impressive on top of the 9.3% growth the company achieved for the same period last year. A number of Wall Street analysts agreed in their follow-up notes to clients on the results. BMO Capital Markets analyst Daniel Salmon wrote: “IPG showed a strong start to 2012 when many were suspecting organic revenue growth could be negative, as the impact of the SC Johnson loss begins to be felt.” Deutsche Bank analyst Matt Chesler noted that the ad holding company “delivered a positive surprise operationally.” The company’s organic growth was well ahead of Wall Street’s consensus estimate of 1.5%, he wrote. The majority of Wall Street firms covering IPG currently have a "buy" rating on the firm. Roth told analysts he was confident that the company would reach its full-year targets of 3% organic revenue growth, while improving its operating profit margin by a half a percentage point. Growth by region was led by Asia-Pacific, which posted nearly 17% organic growth compared to 2.7% growth in the U.S. Continental Europe showed an organic revenue decline of 5.5%, as clients curbed spending in the economically troubled region. Roth said that digital operations throughout the company excelled, as did PR operations including Weber Shandwick and Golin Harris. Mediabrands, Lowe and several U.S.-focused shops also had strong performances in the quarter, he said. Roth said the company’s new business pipeline was more robust now than it was a year ago, when IPG found itself defending more big pieces of business than it was pitching. It’s currently competing in the global Unilever media consolidation review through Initiative (against Mindshare and PHD), where the company, with assignments mostly in Latin America, has much more to win than lose, he said. Add shop Hill Holliday is contending in the Bank of America review, where Roth said there is more of an upside than down. He said the company was expecting decisions in both pitches by the end of the second quarter. The company had a big win in the first quarter, teaming with Omnicom to form a joint-venture agency called Commonwealth which won the global General Motors ad account. That helped IPG generate double-digit growth in its auto sector, said Roth, who noted a double-digit increase in the retail sector as well. The financial service and food and beverage categories also grew, he said.
Bigger revenues from broadband and lesser business from its traditional cable TV operations continues to be the trend for Time Warner Cable -- and a host of other cable operators. Time Warner's first-quarter broadband business witnessed almost a 10% gain to nearly $1.2 billion. Video business grew 2% to $2.7 billion. But the company lost almost 100,000 customers. Time Warner improved its revenue per subscriber by around 4%. But more than compensating for that, its overall customer base -- from broadband and voice -- netted 261,000 customers (as well as 1.6 million through acquisitions). That brought Time Warner's overall customers to 28.9 million. Business services revenue grew 38% million to $429 million coming from higher revenue gains in voice services, wholesale data for wireless-phone providers and high-speed data subscriptions Local cable advertising sales improved 7% to $211 million. Looking to boost advertising sales and its video customer based in Los Angeles, the second-largest U.S. market, chief executive Glenn Britt said it would seek sports rights to the Los Angeles Dodgers after the team's deal ends through the 2013 season with Fox. Time Warner recently acquired the television rights to the Los Angeles Lakers. Overall, programming costs are expected to increase by up to 9%. Company-wide business net profits grew 18% to $382 million with revenues rising 6.4% to $5.13 billion.
Media Storm, an independent media shop with offices in Norwalk, Conn., New York and Los Angeles, has appointed Frank Connolly as the firm’s first CFO. Connolly will also hold the title of executive director. He will report to agency co-founder and managing partner Tim Williams. The agency said it was making the hire because of its rapid growth over the past couple of years. The company does not disclose billings, but they were believed to be in the $500 million range at the end of 2011. The company said that Connolly would help manage the firm’s growth and "operational efficiencies" and assist in developing strategic planning. “In the long-term, he will focus on navigating the agency as we prepare for more expansion as well as potential acquisitions,” Williams said. Connolly is a 30-year veteran of the media and marketing sectors. Prior to joining Media Storm, Connolly spent five years as managing director at AdMedia Partners, an independent M&A advisory firm. Earlier, Connolly held CFO positions at Harris Interactive, Modem Media, E-Sync Networks and DM Holdings. The company has hired several other well-known senior agency executives recently, including Dene Callas, the former CEO of WPP’s MediaCom, as managing director of operations and development. The firm also hired veteran agency research executive Judy Vogel as managing director, insights and analytics. Previously, she led research efforts at both PHD and OMD, and before that BBDO. Founded in 2001, the agency’s client list includes broadcast, cable, consumer electronics and film companies, including FX Network, Open Road Films, Food Network, Loehmann’s, Fox, Linksys, CMT and Fox VOD. The agency also offers clients creative services through its boutique subsidiary Maude, which opened its doors in 2008. A year later, it created Bolt, a unit that specializes in interactive ads. A separate unit, Hip Genius, offers social media, digital PR, sponsorships and promotions expertise.
Hammers and nails, small furry animals and toys, and perhaps some beer and pizza -- that’s what we are thinking about while watching some cable networks with strong advertising messaging. DIY Network, PBS Kids Sprout and NFL Network are the top networks when it comes to viewers who are “more likely to buy products advertised on a network," according to a new study. DIY led with a 35% number, followed closely by PBS Kids Sprout at 34% and NFL Network at 33% -- according to Beta Research. All this compares much more favorably to the average broadcast network, which the survey says garnered an 18% score. Other channels that scored well include Food Network (31%); Disney XD (30%); Nick Jr. (30%); HGTV (29%); G4 (28%); and Nat Geo Wild (28%). Beta Research says some big documentary/reality networks score best as overall view favorites: History earned a 56% score; Discovery Channel, 55%; National Geographic Channel, 52%; Food Network, 50%; H2 (History International), 50%; and ESPN, 49%. The average broadcast network takes in a 40% number. What networks do viewers want to see on their smartphones, tablets or computers? NFL Networks was at 36%; Disney XD, 33%; PBS Kids Sprout, 32%; ESPN, 31%; and ESPN News, 31%.
TV station group Belo Corp.'s first-quarter results inched up, due in part to higher automotive, retail and political advertising. The company, which has 20 stations, and nine in the top 25 markets, had revenue of $156 million -- 3% higher than the same period in 2011. Total advertising revenue was up 2% and leaving out political ad, it gained 1%. Local spot advertising business picked up 4%,but national spot business declined 5%. Political advertising dramatically improved at $1.6 million, a $1.2 million gain over the first quarter 2011. The big growth revenue areas at Belo: Internet and retransmission fees. Combined, the two were up 7% in revenues versus the year before. Slipping away was the long-time revenue source network compensation, which the TV group is no longer getting. The same trend has occurred at other TV stations. Belo got $1.7 million in the first quarter 2011 from network compensation. With the expense of "The Oprah Winfrey Show" gone in syndication, overall station programming costs were down 10% or $4.9 million, compared with the first quarter 2011. In a release, Dunia Shive, president and CEO of Belo Corp, stated more improvements are anticipated in the second quarter, expected total revenue: "to be up around 3% to 4%, including an estimated $4 to $5 million in political revenue."
Aegis Group, the parent of Carat, Isobar, Posterscope and other media services networks, this morning reported healthy gains for the first quarter of 2012. Total revenues rose 17.0% and “organic” revenues rose 8.1%. Aegis Media, the unit managing the company’s media services networks, had an organic revenue growth rate of 8.0%. Aegis said the media group’s growth was driven by “strong momentum” across the group’s network brands, and singled out The Americas, which yielded an organic growth rate of 20.3% during the quarter. “Our performance in the region benefited from an outstanding new business record in North America over the last two years, as well as continued strong results from our market-leading digital business in Brazil,” Aegis said in the report, adding that Asia Pacific organic revenues rose 12.5%, with a significant boost from China. EMEA remained its weakest region in terms of first-quarter performance, generating an organic revenue growth of +1.7%, although that compares with a double-digit growth rate the prior year. Aegis said the outlook for advertising budgets from its clients to date has been “resilient” and noted that their budgets for the remainder of the year “retain growth.”
According to Journal Communications, which publishes the Milwaukee Journal Sentinel among other newspapers, total revenues fell 1.9% to $82.3 million in the first quarter of 2012. This was due to a 9% decrease in publishing revenue to $38 million over this period, more than offsetting a 5.4% increase in Journal’s broadcast revenues to $44.4 million. Within the publishing division, revenue declines were spread across all the major advertising categories, with retail down 9%, classifieds down 17.1% and interactive down 1.6%. Revenue from community newspapers and shoppers fell 22.2% to $5 million. Total circulation revenues fell 2% to $12.3 million. Revenue from Journal’s radio stations increased 1.5% to $14.9 million. As noted, Journal is just the latest in a series of newspaper publishers reporting weak results. Gannett Co. saw total publishing revenues decline 6% to $874 million in the first quarter of 2012. This was due largely to an 8.3% decline in advertising revenues to $551 million, with retail ad revenue down 7.6%, national ad revenue down 13.3% and classifieds down 6.6%. Within Gannett’s U.S. classifieds business, automotive slipped 2.4%, employment was down 1.5%, and real estate tumbled 14.2%. The New York Times Co. saw total advertising revenues slip 8.1% to $238 million, including a 6.1% drop at its news media group. NYTCO’s national ad revenues dropped 6% to $146 million, while retail slid 0.8% to $34.3 million, and classifieds tumbled 10% to $30.3 million. Within NYTCO classifieds category, automotive fell 7.4%, employment 5.5%, and real estate 16.9%. On the plus side, the decline in ad revenues was mostly offset by increased circulation revenues from NYTCO’s online paywalls at The New York Times, International Herald Tribune and Boston Globe. Finally, Media General saw total revenues increase slightly, growing 0.4% to $150 million, due to improved results from its broadcast TV stations and online properties. These were mostly offset by a decline in print ad revenues. Print ad revenues fell at the Richmond Times-Dispatch and Media General’s Charlottesville group, with classifieds down 12%, national down 1% and local down 2.8% in this market segment.
Meredith Lays Off Staffers Meredith Corp. has cut 80 positions from across its portfolio of publications, reducing its staff of 3,400 by about 2.3%. Meredith publishes magazines including Ladies’ Home Journal, Better Homes and Gardens, Family Circle, More, Fitness, Every Day With Rachael Ray, Parents, Family Fun, Traditional Home, Midwest Living and Ser Padres. The layoffs are part of a continuing repositioning of the company, following a string of acquisitions over the last year with a decidedly digital focus. In January, Meredith acquired online recipes site Allrecipes.com from The Readers Digest Association in a transaction valued at $175 million. The acquisition of Allrecipes.com more than doubled the audience of the Meredith Women's Network to around 40 million unique visitors per month, per the company -- and should also double its advertising revenues. On the print side, in October 2011, the company acquired cooking mag Every Day With Rachael Ray and its related digital properties from RDA. Early this year, it completed the acquisition of Family Fun from Disney Publishing Worldwide. These acquisitions come on top of a series of agency acquisitions that have expanded Meredith's marketing services offerings since 2006. While Meredith has invested aggressively in new businesses, it faces continuing revenue declines in its core print business. Excluding recent acquisitions, in Meredith's third fiscal quarter advertising revenues at its national media group fell 7%. However, this was offset somewhat by a 10% increase in revenues in its local media (broadcast TV) group. Fitness Gives Away Free Day at the Gym To celebrate its 20th anniversary, Fitness is launching a “Free-For-All” on May 1, offering readers a Free Day of Fitness in partnership with gyms across the country, including Bally Total Fitness, Crunch, Gold's Gym, Boston Sports Clubs, New York Sports Clubs, Philadelphia Sports Clubs, Washington Sports Clubs, 24 Hour Fitness and select YMCA locations. Along with free access to gyms across the country, Fitness is also hosting five V.I.P. workout events with celebrity trainers Jackie Warner, Harley Pasternak, Billy Blanks, Jim Karas and Beto Perez. The trainers will be teaching exclusive classes for Fitness readers who respond to calls to action via Facebook and Twitter. The events will be held in Chicago, Los Angeles, Miami and New York City. Burgess To Publisher, Prevention Rodale Inc. has appointed Lori Burgess publisher of Prevention. Burgess was most recently the publisher of The Hollywood Reporter, which she helped build into a multimedia platform. Before that, she was publisher of OK! Magazine. In her new role, she will lead all print and digital ad sales and marketing efforts for the Prevention brand. Elvis Costello Performs For Food & Wine CrowdFood & Wine will entertain its guests with some big-name talent at the Food & Wine Classic in Aspen, Colo.: Elvis Costello & The Blue Beguilers will headline an evening of music at the Benedict Music Tent to celebrate the 30th anniversary of the event. Food will be served by chefs José Andrés, Mario Batali and Michel Nischan. The event is sponsored by Belvedere Vodka, Gallo Signature Series, Lexus, Fiji Water, and Stella Artois, and some of the proceeds will go to supporting Food & Wine’s Chefs Make Change charitable initiative. Guests will also have the opportunity to make donations of their own throughout the night. Tickets are $350 and will go on sale Friday, April 27 at foodandwine.com/classic or 877.900.WINE.
VIRTUOSO LIFE magazine (a promo for clients of some 330 travel agencies in its "network") turned to its "expert travel advisors" (that would be themselves) to get the inside scoop on where those "in the know" will be venturing this year. Among the top destinations: THAILAND The Pitch: “Travelers looking for exotic, yet affordable locations will find the ideal destination in Southeast Asia. Bordering countries, Thailand and Laos, offer startling contrasts from mountainous regions with hill-tribes, little towns with lively markets, to densely populated cities such as Bangkok.” Reality Check: Bangkok has acquired the nickname, "Sin City of Asia" as a major destination in the sex industry. Although prostitution in Thailand is technically illegal, it can be found all over Bangkok in vast numbers of massage parlors, saunas, parks, and hourly hotels, serving foreign tourists as well as locals. The red-light districts of Thai cities are home to Chinese-owned brothels, casinos, and entertainment facilities that function both as sources of income and as operations centers for trafficking in humans, narcotics and extortion. Child sex tourism is a serious problem in the country. Thailand, along with Cambodia, India, Brazil and Mexico, has been identified as one of the leading hotspots of child sexual exploitation.Pedophiles in particular exploit the lax laws of the country and attempt to find cover to avoid prosecution. REPUBLIC OF CONGO The Pitch: “Split almost directly in half by the Equator, the French-speaking Republic of Congo sits in the western region of central Africa. The country’s consistent temperate climate and heavy rainfall allows for heavily forested regions with large populations of gorillas.” Reality Check: Many Pygmies in Congo live as slaves to Bantu masters, with the nation deeply stratified between these two major ethnic groups. Even though the Pygmies are responsible for much of the hunting, fishing and manual labor in jungle villages, Pygmies and Bantus alike say Pygmies are often paid at the master's whim: in cigarettes, used clothing, or even nothing at all. A large proportion of the population is undernourished. COLOMBIA The Pitch: “From the regal coffee plantations, dense jungles, snow-capped mountains and gorgeous beaches to the bustling capital, Bogotá, the country offers a wide variety of landscapes. Colombians share a deep pride in their country and are not afraid to show its visitors a good time.” Reality Check: Emerging in the late 1970s, powerful and violent Medellín and Cali drug cartels further developed during the 1980s and 1990s, exerting political, economic and social influence in Colombia during this period. These cartels also financed and influenced different illegal armed groups throughout the political spectrum. After offensives supported by aid from the United States, many security indicators improved. However, this improvement has been criticized for the Colombian Army's continued violations of humans rights and also questionable statistics. The rate of reported abductions declined steadily for almost a decade until 2010, when 280 cases were reported between January and October, most concentrated in the Medellín area. While rural areas and jungles remained dangerous, the overall reduction of violence led to the growth of internal travel and tourism. BRAZIL The Pitch: “The largest country in South America offers travelers a wonderful array of sites from deep Amazon jungle to samba-dancing seaside cities. Brazil’s sunny beaches, culinary scene and nightlife culture are among the best in the world.” Reality Check: Brazil continues to have high crime rates, despite recent improvements. More than 500,000 people were killed by firearms in Brazil between 1979 and 2003, according to a report by the United Nations. In 2010, there were 473,600 people incarcerated in Brazilian prisons and jails. TASMANIA The Pitch: “Located on the other side of the world, and then a two-hour flight from Sydney, Tasmania offers wild and dramatic landscapes for outdoor enthusiasts and adventure-seekers. Because of its remoteness and the currents that flow from the Southern Ocean, the island has some of the planet’s most pristine coastal and inland waters.” Reality Check: The early settlers were mostly convicts and their military guards living in convict-based settlements and prisons, such as the particularly harsh penal colonies at Port Arthur in the southeast and Macquarie Harbor on the West Coast. In the 50 years from 1803 to 1853 around 75,000 convicts were transported to Tasmania. For a hair-raising history of this period, check out Robert Hughes' “The Fatal Shore: The Epic of Australia's Founding.” JORDAN The Pitch: “Although it is a small country – about the size of the state of Indiana – Jordan is a destination with much variety. It is a land of great beauty and even greater history, where medieval castles meet ancient ruins amongst a landscape of rolling hills, expansive deserts and dramatic mountains. “ Reality Check: It shares borders with Syria, Iraq, Israel and Saudi Arabia. Keep your bags packed.