IPG profits tumble 127% for Q2 as holding group concedes there’s more cost cutting to come
IPG – the holding group responsible for agencies including Initiative, Mullen Lowe, R/GA and UM – is the next global giant to reveal how the COVID-19 pandemic and ensuing economic downturn has hit its agencies and clients.
Overnight, the group revealed a loss attributable to shareholders for the second quarter of 2020 of US$45.6m, down from a profit of US$169.5m last year – a decline of 126.9%.
CEO Michael Roth conceded that the group’s cost-cutting measures might not be over yet.
“With our review continuing, we anticipate that we will take additional strategic actions in the second half of the year geared towards further structural cost reductions. These additional actions are expected to result in a second-half restructure expense in the range of US$90m to US$110m,” he said on a call to investors overnight.
Our Australian leadership has communicated clearly at all times. We are all in this together in partnership with our clients. Very proud to work at Mediabrands and could not ask for greater clarity. Mark Coad’s leadership and care continues to be outstanding.
Is this not a further indication the media agency business model is broken? Without keeping score it certainly feels like IPG has been one of the more successful holding companies over the past 12 months.