IPG reports YoY decline in revenue, CEO highlights ‘softness’ from marketers in technology sector
IPG has released its Q1 results for 2023, reporting total revenue of US$2.521 billion (A$3.809) and net revenue of US$2.177 (A$3.291) with a decline in organic growth of 0.2% YoY.
The results were significantly lower than the strong start the holding company had to the year in 2022, with CEO Philippe Krakowsky asserting that IPG’s “strong growth” in “media, healthcare and data-informed practices” was “offset” by “certain areas of softness, notably among marketers in the technology sector”.
Net income for the year was US$126 million (A$190.463), with adjusted EBITA before restructuring charges of US$210.8 million (A$318.759) and 9.7% margin on revenue before billable expense
Krakowsky’s said in a statement, “Financial results in the quarter are consistent with our internal forecast of pacing for the full year, both overall and across each of our operating segments. Since the start of the year, we have won a number of the industry’s most competitive account reviews, encompassing a diverse set of services and client sectors, which increasingly benefits our outlook as we move further into the year. During the quarter, we also demonstrated ongoing strong expense discipline.
“We continue to expect full-year organic growth at the midpoint of our range of 2% – 4%, with fully adjusted EBITA margin of 16.7%. The caliber of our people and our offerings, coupled with strong operating discipline and financial fundamentals, position us well to continue to deliver for our clients and stakeholders, and to further enhance shareholder value.”
The Asia Pacific region saw a 2.6 % organic decrease in net revenue in Q1, the second lowest performance of all regions the company operates in, ahead of continental Europe, which fell 4%.
IPG has a share price of US$35.21 (A$53.24) today, and a market capitalisation of US$13.61 billion (A$20.581) .
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