Dentsu Australia losses total $23m in 2021 amid ‘transformation and simplification’
Dentsu’s Australian holdings posted a loss of $23,601,000 for the calendar year ending 2021 according to an annual audit by EY, following losses of $30,393,000 in CY2020.
As per a document accessed on the ASIC website, the report is in reference to the calendar year of 2021, ending on 31 December.
Dentsu was contacted by Mumbrella in regards to the results, amounting to a total loss of almost $54 million across the two financial years.
A Dentsu spokesperson told Mumbrella: “Backed by our global business, we have been transforming and simplifying how we operate to be a more integrated solutioning business to support solving our clients’ greatest opportunities and challenges.
“This resulted in one-off, non-recurring costs in FY20 and FY21.
“In FY21, our underlying business performance showed healthy double digit revenue growth and significant improvement in underlying margin. We expect this to continue in FY22, consistent with reported performance at Dentsu Group level.”
Total revenue for Dentsu in Australia is listed at $254,484,000 in 2021, a significant rise from $226,922,000 in 2020. The main growth in revenue is listed as coming via production revenue, which was up from $105,385,000 in 2020 to $127,992,000 in 2021. Consulting fees rose from $40,310,000 in 2020 to $46,164,000 also.
Dentsu also reported ‘other’ income of $20,377,000 in 2020, which included $17,295,000 as a Government grant. ‘Other’ expenses were only listed at $21,000 in 2021.
Consultancy fees are listed as being received by the group for various services provided to media owners such as data analysis, running various workshops and DAN academy.
Across 2021, personnel expenses increased by almost $12 million, with wages and salaries increasing from $155,094,000 to $161,008,000. This also included a rise in bonuses in 2021 from $414,000 to $6,863,000. In total, personnel expenses rose from $170,799,000 to $182,703,000.
Severance expenses in 2020 totaled $7,209,000, which were reduced to just $222,000 in 2021.
In the financial statement, depreciation and amortisation expense was listed as a loss of $23,491,000, with ‘other expenses’ listed as $29,581,000.
Dentsu has undergone significant transformation across the past 12 months, which has included a global restructure to its new Dentsu Creative model. It has also taken on a number of senior executives across the group during this period.
Last week, Dentsu delivered its Q2 results for 2022, which lists organic growth at 8.2% for the June quarter, led by organic growth in Australia of 8%.
Australia’s Q2 organic growth was bolstered by a strengthened focus on the Group’s Gaming business, supported by favourable growth in CXM and Media with strong pipeline conversion.
The report states the financial statements have been prepared on a going concern basis, “which contemplates the continuity of normal trading operations and the realisation of assets and settlement of liabilities in the ordinary course of business”.
This topic was discussed on a recent episode of the Mumbrellacast.
Linkedin
Have your say