Amid Mixed Results, Interpublic Cites Advertising, Media As Bright Spots

Troubled agency holding company Interpublic Group reported Tuesday a mixed bag of third-quarter financials, posting a $327.1 million loss and an increase in revenues.

Interpublic, which owns media buying shops Initiative Media and Universal McCann, actually posted a loss of $416.2 million from its continuing operations in the quarter ended Sept. 30. But the bottom line was boosted by the $89.1 million Interpublic got from the recent sale of researcher NFO WorldGroup.

The quarter's revenue picture was mixed, with a 2.3 percent increase to $1.4 billion in overall revenues. But taking into account organic growth, which doesn't include acquisitions and disposals of units like NFO WorldGroup, Interpublic's revenues declined. Organic revenues declined 1.7 percent in the quarter, which is the best performance for the company since 2001. Advertising and media revenue - which is 63 percent of Interpublic's revenues - rose overall 4.1 percent to $492.4 million, but U.S. revenue dropped slightly to $492.4 million in the United States.



David Bell, chairman and chief executive officer of Interpublic, attributed the drop in organic revenue primarily to non-traditional services. He said the company didn't think it was a giant step backward, and that the recovery in the advertising economy and other factors would help them improve.

"We believe that the trend in organic revenue will be positive," Bell said.

Interpublic is working under the shadow of a Securities and Exchange Commission investigation and shareholder lawsuits following its restatement of earnings since 1997. Bell said there's a lot going on behind the scenes to put Interpublic's issues behind it, although there were no new developments to report on either front.

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