Omnicom posts financial results for 2021 Q2 showing sustained recovery
Omnicom (NYSE: OMC), the holding group for Omnicom Group agencies, TBWA and DDB has posted its financial results for Q2 2021, which has seen a continued recovery following the financial impacts of the pandemic.
Revenue is on the up, at US$3.5716 billion a 27.5% rise on the corresponding quarter in 2020, US$2.8 billion. The group saw growth across all regions, including positive organic growth in APAC.
Overall summary. [click to enlarge]
Global CEO and chairman, John Wren said: “We had extremely strong results top and bottom line and continue to make very good progress on several of our strategic initiatives. Organic growth for the second quarter was a positive 24.4%. This growth was broad based across our agencies, geographies, disciplines, and client sectors.”
“Our leaders took difficult and effective actions over the past year and a half. At the same time, they remained laser-focused on the health of their teams, servicing our clients, winning new business, and managing their cost structures.”
A statement from Omnicom on the financial results said: “We experienced an improvement in our business in the second quarter of 2021 as compared to the second quarter of 2020, primarily because the recovery from the COVID-19 pandemic that began in the first quarter 2021 continued into the second quarter. The second quarter of 2020 reflected the most negative impact on our businesses since the onset of the pandemic. The COVID-19 pandemic did not significantly impact our major markets and businesses until late in the first quarter of 2020 and the improvement from the pandemic in 2021 compared to the prior year, was significantly greater in the second quarter.”
Earnings before interest, taxes, and amortisation of intangible assets (EBITA) also increased year-on-year, to US$1.075 billion, up from US$0.5249 billion in 2020. The EBITA margin also increased to 15.4%, up from 8.5% in Q2 2020.
Revenue by discipline. [click to enlarge]
While revenue was up, as was operating expenses, rising from US$2.74 billion in Q2 2020 to $3 billion in 2021, with a salary costs rising 20.8% from US$1.425 billion to $1.7217 billion. This would suggest a rise in staffing, after Omnicom’s financial results for Q2 2020 revealed the group had cut over 6,000 staff in the three months to 30 June, 2020.
Last year’s results saw US$277.9 million outgoing expenses as ‘COVID-19 repositioning costs’, which were not taken into account this year.
In this quarter, 12.5% of overall revenue was reported from the APAC region, with the US making up the largest share with 51.5% overall, the UK 10.6%, and European markets making up 18.6%.
Revenue by region. [click to enlarge]
All regional markets saw organic growth in the second quarter of 2021 as compared to the second quarter of 2020, reported as follows: 19.9% for the United States, 37.1% for Other North America, 23.8% for the United Kingdom, 34.5% for the Euro Markets and Other Europe, 27.9% for Asia Pacific, 20.8% for Latin America and 42.8% for the Middle East & Africa.
Revenue by industry. [click to enlarge]
During this quarter, acquisitions by Omnicom included Archbow Consulting, and Credera acquiring a majority stake in Areteans.
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