Publicis Groupe: First Half 2019 Results

Organic growth at 0.1% in Q2, returning to positive as anticipated, driven by double-digit growth in Game Changers and ramp up of Q4 new business wins

Continued attrition in traditional advertising impacting the US. Strong performance in Europe, Asia and Middle East 

Strong financials in line with expectations with 40bps (1) growth in operating margin rate and growth in headline EPS in H1 2019

Closing of Epsilon acquisition, at a compelling price, completing our transformation in terms of assets

2019 net revenue expected to be broadly stable on an organic basis

Arthur Sadoun, Chairman and CEO of Publicis Groupe:

“As anticipated, we recorded a sequential improvement in Q2 versus Q1, with organic growth returning to positive territory. This growth is healthy and built on solid foundations, with the ramp-up of our Q4 new business and continued double-digit growth of our strategic game changers (+24% in H1).

But our progress has been slowed down by the ongoing fee reduction on traditional advertising that continued to impact our overall US operations by around 300 bps in the quarter. We have taken a major organizational step by accelerating the implementation of our country-model which helps generating growth through cross fertilization. 

Where it is the most advanced, this model is already working very well. This is the case in the UK and France, with net revenue in H1 growing by 4.8% and 3.1% respectively. 

For H1, we are posting strong financial results for the Groupe, with an operating margin improvement of 40 bps supported by our ongoing cost savings plan, half of which was reinvested in our talents and expertise. Our headline EPS is up by 2.5% at constant currencies and excluding Beat tax and Epsilon transaction costs, and our free cash flow remains at a high level. 

Last but not least, we just closed the acquisition of Epsilon in record time at a compelling price. We have a clear integration plan with 25 dedicated teams having worked tirelessly with one very clear objective in mind to accelerate growth. This plan will be executed swiftly.

Everyone is familiar with the disruption created by data and technology. The need for transformation has never been so strong in our industry. We have a model allowing us to address those challenges and invest both in the talents (over 150 million Euros over the last 18 months) and expertise of the future, such as Sapient and Epsilon, while delivering strong financials.  

When it comes to our short-term organic growth, two phenomena explain our situation. On the one hand, our clients are suffering from various pressures leading to budget cuts and fee reductions in sectors where we have a disproportionate share of market. On the other hand, the profound transformation we have been engaged in has penalized us in the short term. But our new model and organization are a clear strength for the longer term, as shown by our track record in new business or the growth posted by our game changers.  

For the second part of the year, we will deliver sequential improvement versus H1 on organic growth. But, as spending cuts are not gone away, we are taking a conservative approach for the full year, forecasting a broadly stable net revenue on an organic basis. 

With this in mind, thanks to the robustness of our model, we can already confirm we will deliver, as planned, a 30 to 50 basis points increase in operating margin and a Headline EPS up by 5 to 10 % at constant rates and including Epsilon.

In the long term, having the organization, talents and assets our clients need, we are very confident that we will generate strong growth thanks to three levers. 

First, our unique set of assets in data, creative, media and technology that can deliver personalized experiences at scale to help our clients accelerate their sales while reducing their costs.

Second, our country model that is already producing strong results in France and the UK, and we will accelerate its implementation in the US where we have just announced a new organization.

Third, our unparalleled way to go to market that will maintain, and for sure accelerate, our New Business momentum.

Our focus now is execution in order to create superior value for all our stakeholders.”


Publicis Groupe [Euronext Paris FR0000130577, CAC 40] is a global leader in communication. The Groupe is positioned at every step of the value chain, from consulting to execution, combining marketing transformation and digital business transformation. Publicis Groupe is a privileged partner in its clients’ transformation to enhance personalization at scale. The Groupe relies on ten expertise concentrated within four main activities: Communication, Media, Data and Technology. Through a unified and fluid organization, its clients have a facilitated access to all its expertise in every market. Present in over 100 countries, Publicis Groupe employs around 103,000 professionals.