Interpublic sees “cautious optimism” among clients despite profit slump

Interpublic Group, owner of the McCann Erickson, Draftfcb and Lowe Worldwide agencies, has forecast “significantly improved” profitability in 2010 despite posting a 42% drop in profit for last year.

The marketing services group says operating income dropped to $341m in 2009, from $589m (£386m) in 2008 as the recession lowered its clients’ marketing spend.

Revenues fell 13.4% to $6bn (£4bn) from $6.9bn (£4.4bn) a year earlier, while international earnings, which includes revenue generated by the group’s UK–based agencies, dipped 16.4% to $2.6bn (£1.7bn).

The profit and revenue declines slowed in the fourth quarter. Revenue fell 7.4% to $909m (£596m) while operating income fell 18.9% to $268m (£188m).

The group’s chairman and CEO Michael I. Roth (pictured) says that economic conditions appear to have stabilised, and “clients are beginning to re-focus on their brands and the tone of the business is one of cautious optimism”.

“Our combination of contemporary, competitive agencies and highly disciplined financial management will be key in driving significantly improved profitability in 2010 and long-term success for IPG,” he adds.

Interpublic is the fourth of the large marketing groups to report full-year results. Publicis Groupe reported a 6.5% drop in revenues, while Omnicom reported revenues fell 12% to $11.7bn (£7.5bn) in 2009. Euro RSCG and MPG owner Havas recently posted a 7.9% drop.    

WPP is scheduled to report fourth quarter and full-year results next Thursday (5 March). 

Latest from Marketing Week

PLEASE SIGN IN OR REGISTER. IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and inspiration that will help you develop as a marketer and leader.

Register and receive the best content from the only title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work, so we can make Marketing Week more relevant to you.

Register now

THE BEST CONTENT

Our award winning editorial team and columnists will ask the biggest questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we will be your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Dedicated to developing your skills and helping you achieve marketing excellence. Find guidance on leadership, professional development and the latest industry jobs.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here