Dentsu Group today reported a 0.8% drop in organic growth for the first quarter with reported net revenues of approximately $2.1 billion, down 0.4%.
The company’s Japan business posted organic growth (which strips out M&A and currency impact) of 2.1% while its international business (Dentsu Aegis Network) reported an organic revenue decline of 3.3%.
The company cited the impact of COVID-19 with particular weakness in DAN’s Asia-Pacific region, which was down nearly 20%. The America’s region posted growth of 1.2% while EMEA was down 0.4%.
The U.S. market turned in a relatively strong performance, up 2.2% which the company said was driven by CRM businesses and continuing high demand for Merkle-related services including precision marketing platform M1.
The company has suspended guidance for the year but company CEO Toshihiro Yamamoto stated that the firm anticipates “a material decline in revenues across our business” for the full year.
Like the other holding companies, Dentsu has taken some extraordinary cost cutting measures including a pause in M&A activity at least through the end of the second quarter, travel cutbacks, reduced working hours and temporary salary cuts and some layoffs.
The company said it is targeting a 7% cut out of its 2020 budget.