Interpublic Group (IPG) posted a 4.4% fall in full year organic revenue, recorded a strong performance in the US, increased dividends and is confident of business prospects going into 2021.
The global advertising company reported net revenue for the year to December down 6.5% to $US8.06 billion.
Fourth quarter results were ahead of analyst expectations. Reported net revenue for the three months to December was $US2.28 billion, down 6.1% from a year ago.
Organic net revenue dropped 5.4%. In the US, fourth quarter organic net revenue was down just 1.8%. International markets fell 10.5%. Aisa Pacific was down 17.4%.
IPG’s shares slipped 5.5% to $US24.83 on the New York Stock Exchange. IPG stands out among advertising groups with its share price regaining pre-pandemic levels.
“While visibility into the full year remains challenging, due to exceptional macroeconomic circumstances, we fully expect to return to positive organic growth over the course of the year, and to post full-year 2021 growth consistent with the industry, on top of IPG’s 2020 outperformance relative to our peer group,” says CEO Philippe Krakowsky.
“Along with that growth, we expect to continue to build on our long-term record of improving profitability and sustained value creation.”
Krakowsky described the December quarter result as “solid,” especially in the US.
“We continued to be disciplined with respect to expenses, proactive and strategic in our approach to structural cost actions, while simultaneously investing in our business during the year to accelerate areas of strongest opportunity and growth,” he says.
“That investment continues to result in differentiated capabilities and forward-looking offerings, which are in demand and driving success in the marketplace.”
“Heading into 2021, we are confident of the strength and competitiveness of our offerings, the talent within our group, and the value that our services can deliver by ensuring that clients' businesses and brands thrive in the digital economy.
“Our commitment to a strong balance sheet and financial flexibility remains a key priority, and the action by our Board announced today to increase our dividend further speaks to confidence in the forward trajectory of our company.”
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