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Publicis is resisting the crisis better than expected

2021-02-03T06:52:54.128Z

The income of the French advertising group fell only 6.3% in 2020. The acquisition of Epsilon is bearing fruit.



Publicis published, this Wednesday morning, results higher than those anticipated by the market.

The French group, number three in the world in communications (Publicis, Leo Burnett, Saatchi & Saatchi, Starcom, Zenith ...), recorded last year a revenue of 9.7 billion euros, an organic decline of 6 , 3%, which constitutes proof of resistance given the very complicated period experienced by the whole industry because of the pandemic.

In France, the decrease in turnover is -12.5%.

On a reported basis, overall sales remained stable (-0.9%), thanks to the integration of the American company Epsilon, acquired in 2019 for 4.4 billion dollars.

Publicis justified this operation, the most expensive in its history, by refocusing the market around data issues.

Epsilon is indeed a major player in the collection and processing of consumer data in the United States.

The shift in the market towards online advertising, which makes it essential to control this data for targeting, has increased demand from advertisers.

Publicis takes advantage of this.

In the American market, which now represents more than 60% of its income, the dynamism of Epsilon, combined with the recent gain in several budgets (Disney, Kraft Heinz, Sephora, TikTok, Visa, etc.), has driven growth, which even came out positive in the last quarter of 2020 (+ 0.5%).

A very positive signal which must however be confirmed.

"

Our long-term investments in data and technology (...) have enabled us to withstand this year of multiple crises, limiting the drop in our income and maintaining the best financial indicators in the industry

", underlines Arthur Sadoun, chairman of the management board of Publicis, quoted in a press release.

Wage effort reimbursed

In the last quarter, Publicis limited the decline in its income to 3.9%, "

above expectations

" (consensus at 6.7%), specifies the group, which also announces several gestures towards its shareholders and of its employees.

Regarding its shareholders, Publicis has planned to resume a generous dividend policy.

After a year of 50% coupon reduction in 2020, the dividend paid in 2021 for fiscal year 2020 will amount to € 2, close to the level for “ordinary” years.

Finally, with regard to employees, the 6,000 who had agreed to lower their salaries by 10% to 20% between April and June 2020 to contribute to the “war effort” in the face of the crisis, will be reimbursed this month.

Like his peers the British WPP, world number one, or the American Omnicom, number 2, Publicis had asked at the time of the peak of the pandemic, past the shock of the first confinement, for his high salaries to concede income cuts to cross storm.

Among these global “holding companies”, to which are added the American Interpublic, the Japanese Dentsu and the French Havas (Vivendi), Publicis is the first to publish its 2020 results. Interpublic will be next, on February 10.

Source: lefigaro

All life articles on 2021-02-03

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