OMNICOM GROUP., INC. NEW YORK, Oct. 18, 2016 /PRNewswire/ -- Omnicom Group Inc. (NYSE: OMC) today announced that its diluted net income per common share for the third quarter of 2016 increased nine cents, or 9.3%, to $1.06 per share versus $0.97 per share for the third quarter of 2015.
Omnicom's worldwide revenue in the third quarter of 2016 increased 2.3% to $3,791.1 million from $3,706.6 million in the third quarter of 2015. The components of the change in revenue included an increase in revenue from organic growth of 3.2%, an increase in revenue from acquisitions, net of dispositions of 0.4% and a decrease in revenue from the negative impact of foreign exchange rates of 1.3% when compared to the third quarter of 2015.
Across our regional markets, organic revenue growth in the third quarter of 2016 was 1.7% in North America, 5.2% in the United Kingdom, 2.0% in the Euro Markets and Other Europe, 8.0% in Asia Pacific, 11.9% in Latin America and 15.6% in the Middle East and Africa when compared to the same quarter of 2015.
The change in organic revenue in the third quarter of 2016 as compared to the third quarter of 2015 in our four fundamental disciplines was as follows: advertising increased 3.6%, CRM increased 1.6%, public relations increased 4.4% and specialty communications increased 6.2%.
Operating income in the third quarter of 2016 increased $24.8 million, or 5.8%, to $453.1 million from $428.3 million in the third quarter of 2015. Our operating margin for the third quarter of 2016 increased to 12.0% versus 11.6% for the third quarter of 2015.
For the third quarter of 2016, earnings before interest, taxes and amortization of intangibles ("EBITA") increased $27.4 million, or 6.0%, to $482.1 million from $454.7 million in the third quarter of 2015. Our EBITA margin (defined as EBITA divided by revenue) increased to 12.7% for the third quarter of 2016 versus 12.3% in the third quarter of 2015.
For the third quarter of 2016, our income tax rate was 32.7% compared to 32.8% for the same period in 2015.
Net income for the third quarter of 2016 increased $14.5 million, or 6.1%, to $253.8 million from $239.3 million in the third quarter of 2015.
Year-to-date
Diluted net income per common share for the nine months ended September 30, 2016 increased 25 cents, or 8.2%, to $3.31 per share compared to $3.06 per share for the nine months ended September 30, 2015.
Worldwide revenue for the nine months ended September 30, 2016 increased 1.8% to $11,175.1 million from $10,981.1 million in the same period of 2015. The components of the change in revenue included an increase in revenue from organic growth of 3.4%, an increase in revenue from acquisitions, net of dispositions of 0.3% and a decrease in revenue from the negative impact of foreign exchange rates of 1.9% when compared to the same period of 2015.
Across our regional markets for the nine months ended September 30, 2016, organic revenue growth was 3.1% in North America, 3.6% in the United Kingdom, 3.1% in the Euro Markets and Other Europe, 5.9% in Asia Pacific, 1.4% in Latin America and 5.1% in the Middle East and Africa when compared to the same period of 2015.
The change in organic revenue for the nine months ended September 30, 2016 compared to the same period in 2015 in our four fundamental disciplines was as follows: advertising increased 6.4%, public relations increased 1.2% and specialty communications increased 4.3%, while CRM decreased 0.6%.
Operating income for the nine months ended September 30, 2016 increased $62.4 million, or 4.6%, to $1,407.0 million compared to $1,344.6 million for the same period in 2015. Our operating margin for the nine months ended September 30, 2016 increased to 12.6% versus 12.2% for the same period in 2015.
Omnicom's EBITA for the nine months ended September 30, 2016 increased 4.7%, or $67.3 million, to $1,492.7 million from $1,425.4 million for the same period in 2015. Our EBITA margin for the nine months ended September 30, 2016 increased to 13.4% versus 13.0% for the same period in 2015.
For the nine months ended September 30, 2016, our income tax rate was 32.6% compared to 32.8% for the same period in 2015.
Net income for the nine months ended September 30, 2016 increased $36.0 million, or 4.7%, to $798.3 million from $762.3 million versus the same period in 2015.
Non-GAAP Financial Measures
We used certain non-GAAP financial measures in describing our performance above. We use EBITA (defined as earnings before interest, taxes and amortization of intangibles) and EBITA margin (defined as EBITA divided by revenue) as additional operating performance measures, which excludes the non-cash amortization expense of intangible assets (primarily consisting of amortization arising from acquisitions), because we believe it is a useful measure for investors to evaluate the performance of our businesses. The financial tables at the end of this document reconcile EBITA to the GAAP financial measure of net income for the periods presented.
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with U.S. GAAP. Non-GAAP financial measures reported by us may not be comparable to similarly titled amounts reported by other companies.
Omnicom Group Inc. (NYSE: OMC) (www.omnicomgroup.com) is a leading global marketing and corporate communications company. Omnicom's branded networks and numerous specialty firms provide advertising, strategic media planning and buying, digital and interactive marketing, direct and promotional marketing, public relations and other specialty communications services to over 5,000 clients in more than 100 countries. Follow us on Twitter for the latest news.
For a live webcast or a replay of our third quarter earnings conference call, go to http://investor.omnicomgroup.com/investor-relations/news-events-and-filings.
Omnicom Group Inc.
Consolidated Statements of Income
Three Months Ended September 30
(Unaudited)
(Dollars in Millions, Except Per Share Data)
2016 2015
---- ----
Revenue $3,791.1 $3,706.6
Operating
Expenses:
Salary and
service
costs 2,855.3 2,799.8
Occupancy
and other
costs 305.5 303.0
----- -----
Costs of
services 3,160.8 3,102.8
Selling,
general
and
administrative
expenses 104.1 103.7
Depreciation
and
amortization 73.1 71.8
---- ----
Total
operating
expenses 3,338.0 3,278.3
Operating
Income 453.1 428.3
Add back:
Amortization
of
intangibles 29.0 26.4
---- ----
EBITA (a) 482.1 454.7
Amortization
of
intangibles 29.0 26.4
Operating
Income 453.1 428.3
Net
Interest
Expense 42.0 35.9
---- ----
Income
before
income
taxes 411.1 392.4
Income tax
expense 134.3 128.9
Income from
equity
method
investments 1.4 3.2
--- ---
Net income 278.2 266.7
Less: Net
income
allocated
to
noncontrolling
interests 24.4 27.4
---- ----
Net income
- Omnicom
Group Inc. 253.8 239.3
Less: Net
income
allocated
to
participating
securities 1.2 2.5
Net income
available
for common
shares $252.6 $236.8
====== ======
Net income
per common
share -
Omnicom
Group Inc.
Basic $1.06 $0.97
Diluted $1.06 $0.97
Weighted
average
shares (in
millions)
Basic 237.4 243.2
Diluted 238.7 244.4
Dividend
declared
per common
share $0.55 $0.50
(a) EBITA (defined as earnings before interest, taxes and
amortization of intangibles) is a non-GAAP financial measure. We
use EBITA as an additional operating performance measure, which
excludes the non-cash amortization expense of intangible assets
(primarily consisting of amortization arising from acquisitions),
because we believe it is a useful measure for investors to evaluate
the performance of our businesses. The above table reconciles EBITA
to the GAAP financial measures for the periods presented. Non-GAAP
financial measures should not be considered in isolation from, or as
a substitute for, financial information presented in compliance with
U.S. GAAP. Non-GAAP financial measures reported by us may not be
Omnicom Group Inc.
Consolidated Statements of Income
Nine Months Ended September 30
(Unaudited)
(Dollars in Millions, Except Per Share Data)
2016 2015
---- ----
Revenue $11,175.1 $10,981.1
Operating
expenses:
Salary and
service costs 8,304.5 8,159.8
Occupancy and
other costs 920.2 942.0
----- -----
Cost of
services 9,224.7 9,101.8
Selling,
general and
administrative
expenses 323.1 316.0
Depreciation
and
amortization 220.3 218.7
----- -----
Total
operating
expenses 9,768.1 9,636.5
------- -------
Operating
Income 1,407.0 1,344.6
Add back:
Amortization
of
intangibles 85.7 80.8
---- ----
EBITA (a) 1,492.7 1,425.4
Amortization
of
intangibles 85.7 80.8
Operating
Income 1,407.0 1,344.6
Net Interest
Expense 127.0 104.7
----- -----
Income before
income taxes 1,280.0 1,239.9
Income tax
expense 417.7 406.9
Income from
equity method
investments 4.0 6.2
--- ---
Net income 866.3 839.2
Less: Net
income
allocated to
noncontrolling
interests 68.0 76.9
---- ----
Net income -
Omnicom Group
Inc. 798.3 762.3
Less: Net
income
allocated to
participating
securities 4.8 9.0
Net income
available for
common shares $793.5 $753.3
====== ======
Net income per
common share
- Omnicom
Group Inc.
Basic $3.33 $3.08
Diluted $3.31 $3.06
Weighted
average
shares (in
millions)
Basic 238.4 244.7
Diluted 239.6 245.8
Dividend
declared per
common share $1.60 $1.50
(a) EBITA (defined as earnings before interest, taxes and
amortization of intangibles) is a non-GAAP financial measure. We
use EBITA as an additional operating performance measure, which
excludes the non-cash amortization expense of intangible assets
(primarily consisting of amortization arising from acquisitions),
because we believe it is a useful measure for investors to evaluate
the performance of our businesses. The above table reconciles EBITA
to the GAAP financial measures for the periods presented. Non-GAAP
financial measures should not be considered in isolation from, or as
a substitute for, financial information presented in compliance with
U.S. GAAP. Non-GAAP financial measures reported by us may not be
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/omnicom-group-reports-third-quarter-and-year-to-date-2016-results-300346246.html
SOURCE Omnicom Group
