Dentsu closed the year with organic revenue growth flat at –0.1% but noted a pick up in the December quarter of 2.6%.
However, the global advertising group sees only 1% growth in 2025 as the Japan-based company concentrates on an internal restructure.
December quarter revenue in Japan came in ahead of expectations with 8.4% growth.
The Americas fell 2.9%, EMEA was up 3.5% and APAC down 3.9%.
The company said APAC remained negative for the full year, below expectations despite implementation of intensive measures to re-establish growth.
Although there has been improvement in the fourth quarter, the business environment remains challenging.
“CXM in particular continues to face difficult conditions, especially in Australia, which is suffering a decrease in local client spend. CXM recorded a double-digit organic decline for the full year.”
The group’s full year results were in line with the company’s November guidance with broadly flat organic revenues, and operating margins higher than expectations, said CEO Hiroshi Igarashi.
“We saw sequential quarterly improvement throughout the year, with strong performance in Japan,” he said.
“There were also some notable global new wins in the International business. “However, we have reported a significant goodwill impairment in the fourth quarter, reflecting a more conservative outlook in EMEA and the Americas.
“We believe that recognition of these uncertainties will contribute to a sounder balance sheet and a stronger platform.
The company is concentrating on restructuring, aiming for organic growth of 4%, and 16-17% in operating margin in the 2027 financial year.
“We will conduct a thorough review of our core business strengths, be more selective and focused on what we do, and adopt a differentiated strategy to meet our diversifying client needs,” he said.
“While we will continue to invest in data and technology and our people and culture, we will also invest into areas where we can increase our media capabilities in our key markets.
“At the same time, we will re-evaluate our underperforming businesses and rebuild our business structure.
“Our ultimate goal is to regain competitiveness and return to a growth trajectory.
“We remain focused on increasing our shareholder value and during the coming three years, we will maintain stable dividend payment. We also retain our long-term target dividend payout ratio at 35%.”
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