MDC Partners certainly sounds like a company preparing itself for sale.
That was evident from an earnings call today when CFO David Doft talked a lot about the company’s cost cutting efforts.
There are now rumors that the company’s axe wielding has been fairly severe at media agency Assembly, although Doft didn’t confirm that on the call and queries to company officials weren’t immediately returned.
“We have taken targeted actions throughout the year to lower the cost structure of our agencies that will deliver annualized savings in excess of $50 million, including about 15% of corporate staff costs,” Doft said on the call.
He added that “we've accelerated our planned strategy to restructure costs with a focus on increased profitability and cash generation into 2019.”
Among the corporate executives laid off earlier this year was Bob Kantor, who had been CMO and one of the firm’s top-five highest paid executives according to the company’s proxy statement issued earlier this year.
Other agencies in addition to Assembly have also been cut back. Last month Crispin Porter + Bogusky confirmed it was shuttering its LA office to consolidate in Boulder. Late last year, the agency shut its Miami office.
In May 72andSunny reportedly cut 5% of its staff in Los Angeles.
No doubt MDC Partners has a stable full of talented agencies, the aforementioned, and others like Doner, Anomaly and Forsman & Bodenfors (which recently absorbed KBS) among them.
But the evidence is mounting that the parts are greater than the whole.