Omnicom Group Inc. (OMC - Free Report) reported solid first-quarter 2019 results wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings of $1.17 per share beat the consensus mark by 9 cents and increased 2.6% on a year-over-year basis.
Omnicom Group Inc. EPS Diluted (TTM)
Total revenues of $3.5 billion beat the consensus estimate by $2 million but decreased 4.4% year over year on a reported basis. The year-over-year decrease was due to negative foreign exchange rate impact of 3.4% and a decrease in acquisition revenues, net of disposition revenues of 3.6%, partially offset by organic revenue growth of 2.5%.
Shares of Omnicom have gained 3.9% over the past year against a 13.1% decline of the industry it belongs to.
Let’s check out the numbers in detail.
Revenues by Segment
Advertising segment revenues of $1.9 billion increased 1.1% year over year on a reported basis and 5.1% organically. The segment accounted for 55% of total revenues in the reported quarter.
CRM Consumer Experience revenues of $605.8 million declined 4.6% year over year on a reported basis and 0.6% organically. The segment contributed 18% to total revenues.
CRM Execution & Support revenues of $349.5 million decreased 31.3% year over year on a reported basis and 3.3% organically. It accounted for 10% of total revenues.
PR revenues of $334.2 million declined 3.5% year over year on a reported basis and 0.5% organically. It contributed 10% to total revenues.
Healthcare revenues of $258.1 million were up 8.2% year over year on a reported basis and 6.8% organically. It accounted for 7% of total revenues.
Revenues by Regions
Revenues from United States came in at $1.9 billion, up 0.2% year over year on a reported basis and 2% organically. The region accounted for 54% of total revenues in the reported quarter.
Revenues from Other North America came in at $105.1 million, up 0.4% year over year on a reported basis and 6.1% organically. The region accounted for 3% of total revenues.
Revenues from UK came in at $338.7 million, down 5.4% year over year on a reported basis but up 1.3% organically. It accounted for 10% of total revenues.
Euro & Other Europe revenues of $606.8 million declined 14.8% year over year on a reported basis but improved 4% organically. The region contributed 18% to total revenues.
Revenues from Asia Pacific came in at $366.2 million, down 6.6% year over year on a reported basis but increased 2.1% organically. It accounted for 11% of total revenues.
Latin American revenues of $89 million declined 17.9% year over year on a reported basis but improved 3% organically. It contributed 3% to total revenues.
Revenues from the Middle East and Africa were $79 million, up 7.6% year over year on a reported basis and 12.8% organically. It accounted for 2% of total revenues.
Operating Results
Operating profit in the quarter increased 1.7% year over year to $428.9 million. Operating margin increased to 12.4% from 11.6% in the year-ago quarter.
Earnings before interest, taxes and amortization (EBITA) for the reported quarter were $450.5 million, slightly up from $449.2 million in the year-ago quarter. EBITA margin came in at 13% compared with 12.4% in the year-ago quarter.
Cash Flow
The company used $395.6 million in operating activities and generated free cash flow of $340.7 million in the quarter. Capital expenditures were $27.2 million. It paid $134.8 million as dividends to common shareholders.
Zacks Rank and Other Stocks to Consider
Currently, Omnicom carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some other top-ranked stocks in the broader Zacks Business Services sector are Automatic Data Processing (ADP - Free Report) , Broadridge Financial (BR - Free Report) and WEX (WEX - Free Report) , each carrying a Zacks Rank #2. The long-term expected EPS (three to five years) growth rate for Broadridge, Automatic Data Processing and WEX is 10%, 13% and 15%, respectively.
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Omnicom Group Inc. (OMC - Free Report) reported solid first-quarter 2019 results wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings of $1.17 per share beat the consensus mark by 9 cents and increased 2.6% on a year-over-year basis.
Omnicom Group Inc. EPS Diluted (TTM)
Total revenues of $3.5 billion beat the consensus estimate by $2 million but decreased 4.4% year over year on a reported basis. The year-over-year decrease was due to negative foreign exchange rate impact of 3.4% and a decrease in acquisition revenues, net of disposition revenues of 3.6%, partially offset by organic revenue growth of 2.5%.
Shares of Omnicom have gained 3.9% over the past year against a 13.1% decline of the industry it belongs to.
Let’s check out the numbers in detail.
Revenues by Segment
Advertising segment revenues of $1.9 billion increased 1.1% year over year on a reported basis and 5.1% organically. The segment accounted for 55% of total revenues in the reported quarter.
CRM Consumer Experience revenues of $605.8 million declined 4.6% year over year on a reported basis and 0.6% organically. The segment contributed 18% to total revenues.
CRM Execution & Support revenues of $349.5 million decreased 31.3% year over year on a reported basis and 3.3% organically. It accounted for 10% of total revenues.
PR revenues of $334.2 million declined 3.5% year over year on a reported basis and 0.5% organically. It contributed 10% to total revenues.
Healthcare revenues of $258.1 million were up 8.2% year over year on a reported basis and 6.8% organically. It accounted for 7% of total revenues.
Revenues by Regions
Revenues from United States came in at $1.9 billion, up 0.2% year over year on a reported basis and 2% organically. The region accounted for 54% of total revenues in the reported quarter.
Revenues from Other North America came in at $105.1 million, up 0.4% year over year on a reported basis and 6.1% organically. The region accounted for 3% of total revenues.
Revenues from UK came in at $338.7 million, down 5.4% year over year on a reported basis but up 1.3% organically. It accounted for 10% of total revenues.
Euro & Other Europe revenues of $606.8 million declined 14.8% year over year on a reported basis but improved 4% organically. The region contributed 18% to total revenues.
Revenues from Asia Pacific came in at $366.2 million, down 6.6% year over year on a reported basis but increased 2.1% organically. It accounted for 11% of total revenues.
Latin American revenues of $89 million declined 17.9% year over year on a reported basis but improved 3% organically. It contributed 3% to total revenues.
Revenues from the Middle East and Africa were $79 million, up 7.6% year over year on a reported basis and 12.8% organically. It accounted for 2% of total revenues.
Operating Results
Operating profit in the quarter increased 1.7% year over year to $428.9 million. Operating margin increased to 12.4% from 11.6% in the year-ago quarter.
Earnings before interest, taxes and amortization (EBITA) for the reported quarter were $450.5 million, slightly up from $449.2 million in the year-ago quarter. EBITA margin came in at 13% compared with 12.4% in the year-ago quarter.
Cash Flow
The company used $395.6 million in operating activities and generated free cash flow of $340.7 million in the quarter. Capital expenditures were $27.2 million. It paid $134.8 million as dividends to common shareholders.
Zacks Rank and Other Stocks to Consider
Currently, Omnicom carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some other top-ranked stocks in the broader Zacks Business Services sector are Automatic Data Processing (ADP - Free Report) , Broadridge Financial (BR - Free Report) and WEX (WEX - Free Report) , each carrying a Zacks Rank #2. The long-term expected EPS (three to five years) growth rate for Broadridge, Automatic Data Processing and WEX is 10%, 13% and 15%, respectively.
Will you retire a millionaire?
One out of every six people retires a multimillionaire. Get smart tips you can do today to become one of them in a new Special Report, “7 Things You Can Do Now to Retire a Multimillionaire.”
Click to get it free >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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