NEW YORK – Interpublic announces Q1 2020 results, reporting a net revenue of $1.97 billion, a decrease of 1.6% from a year ago, with organic net revenue growth of 0.3%. Management highlights strategic and operating strengths, exceptional talent base, deep financial resources, and flexible cost model, amid macroeconomic and marketing uncertainty due to COVID-19 pandemic.
“It goes without saying that uncertainty and anxiety as a result of the devastating COVID-19 pandemic have generated significant challenges. Our top priority continues to be the safety and well-being of our people, as well as fully supporting our clients and communities. It’s too early to predict the duration and extent of macroeconomic pressure on marketers and our business, but it is heartening to see that our talented workforce has proven adept and comfortable at leveraging technology and collaborating virtually to continue to work effectively. Unfortunately our solid results in the first quarter cannot be indicative of the remainder of the year. Our performance, however, is an indication of the competitiveness and the strength of our offerings and our people. With more than 95% of our employees working from home, we continue to serve our clients around the globe, generate great ideas across all marketing disciplines and channels, and move the business forward,” commented Michael Roth, Chairman and CEO of IPG.
IPG shared the following:
- First quarter 2020 net revenue decreased 1.6% to $1.97 billion, compared to $2.00 billion in the first quarter of 2019. During the quarter, the organic net revenue increase was 0.3%, while the effect of foreign currency translation was negative 1.0%, and the impact of net dispositions was negative 0.9%. First quarter 2020 total revenue remained flat at $2.36 billion compared to the same period in 2019.
- Operating income in the first quarter of 2020 was $75.9 million, compared to $50.2 million in 2019. EBITA was $97.2 million in the first quarter of 2020 compared to adjusted EBITA of $103.6 million in the prior-year period, which excludes restructuring charges of $31.8 million. EBITA margin on net revenue was 4.9%, compared to adjusted EBITA margin of 5.2% in 2019.
- Income tax provision in the first quarter of 2020 was $17.2 million on income before income taxes of $20.0 million.
- First quarter 2020 net income available to IPG common stockholders was $4.7 million, resulting in earnings of $0.01 per basic and diluted share. Adjusted earnings were $0.11 per diluted share as adjusted for after-tax amortization of acquired intangibles of
$17.1 million and an after-tax loss of $22.4 million on the sales of businesses. This compares to adjusted earnings of $0.11 per diluted share a year ago.
“Over a period of many years, our management team has demonstrated that we have the financial and management talent, tools, and business model, to successfully navigate through difficult times. Our company’s balance sheet and liquidity are strong, and were further enhanced when we proactively accessed the capital markets a few weeks ago. As always, we remain committed to the high level of transparency that you have come to expect from this team, and look forward to returning to our strong trajectory of organic revenue and profit growth once the macro situation stabilizes and a recovery begins to take hold. We are thankful for the continued close partnership with our clients, and proud of our employees around the world and how they have come together during these exceptional times,” added Mr. Roth.
