New York-based Omnicom Group Inc. said Tuesday that total revenues rose 18.3 percent in the fourth quarter--from $2.1 billion in the fourth quarter of 2002 to $2.5 billion for the same period a year later. Organic revenue growth, which excludes the impact of acquisitions, rose 7.6 percent to $160.3 million in the fourth quarter.
Net income in the quarter rose 10 percent, from $201.5 million ($1.08 a share) in 2002 to $221.3 million ($1.17 a share) in 2003. Analysts had been expecting $1.18 a share, according to Thomson/First Call.
Omnicom's shares fell $1.18 to close at $81.92 on volume of 2.1 million shares in trading Tuesday on the New York Stock Exchange.
Fourth-quarter U.S. revenues grew 15 percent, from $1.1 billion in 2002 to $1.3 billion in 2003. The United States is by far Omnicom's largest market-at 53 percent of revenues in the fourth quarter and 54.8 percent for all of 2003.
"The United States is recovering nicely," noted John Wren, president and chief executive of Omnicom, in a conference call with analysts Tuesday morning.
Net new business, which takes into account new business as well as lost accounts, totaled $978.2 million in the fourth quarter. Account wins included the McDonald's media consolidation, which it pulled away from Publicis' Starcom MediaVest Group.
"Net new business has gotten off to a pretty strong start, and we expect that new business activity will continue to show strength, at least through the first quarter of the year," Wren said.
For the full year, total revenue grew 14.4 percent to $8.6 billion in the fourth quarter of 2003, from $7.5 billion in the same period a year ago. Domestic revenue rose 10 percent, to $4.7 billion compared to $4.2 billion in the fourth quarter of 2002.
Full-year net income rose 5 percent, from $643.5 million ($3.44 a share) to $675.9 million ($3.59 a share).