• by Joe Mandese , February 9, 2005

Havas, the agency holding company that owns MPG, Wednesday reported a financial turnaround during the fourth quarter of 2004, which its management said was a direct result of a strategic reorganization it put in place about a year ago that was designed to reposition it from the sixth-largest ad organization in the world to one of the top contenders. Havas, itself has been the subject of hostile takeover speculation in the months following its failed bid to acquire Grey Global Group, said it doubled its rate of organic growth during the quarter, putting it in a stronger position worldwide and pushing its North American operations back into "positive" territory.

Describing the results as a "turnaround," Chairman-CEO Alain de Pouzilhac said detailed results released in early March would "show, moreover, that all the targets management had set itself over the year have been achieved and even exceeded."

Havas said the 3.4 percent growth of its U.S. operations were due mainly to "record" new business activity at Arnold, MPG and the Healthcare and Marketing Services unit at Euro RSCG. Recently, MPG lost about $200 million in media buying duties for Volkswagen due to a consolidation at Volkswagen's global media agency MediaCom. But it lost the nearly $300 million media account for Intel Corp.

Havas' Organic Revenue Growth

                 Q4 2004    Full Year 2004 
North America      +3.4%             -1.9% 
Worldwide          +4.6%             +2.0% 

Source: Havas financial release.