Roth called MAGNA Consortium’s efforts to build the “most comprehensive, scaled data stack” a catalyst for key client wins (such as The Hershey Co.) during the year.
However, a hit to IPG’s European business, which cost the advertising and media-holding company $60.6 million in pretax restructuring fees to offset “significantly lower revenues” than expected, dimmed the holding company’s earnings somewhat.
“A few of our businesses that saw revenue decreases did not cut costs fast enough against some revenue shortages,” Roth said. “Part of the [reason why] was we had some changes structurally in our agencies, and had added new leadership talent across strategic, creative and management.”
He noted that acquiring key talent will keep the agency competitive, but did allude to the fact that this, indeed, takes time and that results should materialize in 2014.
As a result of its restructuring efforts and ongoing expense and revenue discipline, IPG anticipates savings of $40 million moving into 2014, which is characterized by its stated focus on margin improvements. The company said a $300 million share repurchase program announced Friday reaffirms this.
Competing holding company Omnicom Group, which had its proposal for a $35.1 billion merger with French holding company Publicis approved last month by European regulators, may have to wait until the third quarter to execute the merger, its CEO John Wren forewarned on a Q4 earnings call Tuesday.
Omnicom revenues totaled just below $4.1 billion, representing a 4.2% increase in organic growth. The company, however, incurred $41.4 million in incremental costs for the full year as a result of the planned merger; Publicis hit some speed bumps in Q4, as it failed to meet its growth target and cited weaker growth in emerging markets, including China.
Zach Rodgers contributed.