Interpublic Group of Companies Inc.
) reported earnings of 22 cents per diluted share for the second
quarter, up from 19 cents in the second quarter of 2011. The result
surpassed the Zacks Consensus Estimate by a penny.
Revenue inched lower year over year to $1715.7 million from $1740.7
million in 2Q11, with a 3.7% sales decline in the U.S. However, a
1.6% growth was registered internationally. Revenue in the quarter
missed the Zacks Consensus Estimate of $1,760 million.
Organic revenue increased 0.8% during the quarter, which was
based on high growth in international markets, marketing services
and digital capabilities.
Operating income was recorded at $176.4 million, compared with $174
million in the year-ago period. Operating expenses in the quarter
inched up 1.7% to $1,539.3 million. This included an increase of
0.6% in salaries and related expenses and 4.4% in office and
general expenses. Operating margin in the quarter was 10.3%,
compared with 10% in the year-ago quarter.
Exiting the second quarter, the company's cash and cash equivalents
and marketable securities amounted to $1.51 billion, compared with
$1.59 billion in the previous quarter. Total debt was recorded at
$1.63 billion, compared with $1.62 billion in the preceding
Share Repurchase Program/ Dividend:
During the second quarter of 2012, the company repurchased 6.0
million shares at an aggregate cost of $65.6 million and an average
price of $10.92 per share. The company also declared and paid a
common stock cash dividend of $0.06 per share, for a total of $26.1
The company is the third largest advertising company in the
world, offering a range of advertising and marketing communication
services. The company competes with other industry players, such as
Omnicom Group Inc.
Publicis Groupe SA
We currently maintain a long-term Neutral recommendation on the
stock. The company holds a Zacks #3 Rank, which translates into a
short-term (1-3 months) Hold rating.
INTERPUBLIC GRP (IPG): Free Stock Analysis
OMNICOM GRP (OMC): Free Stock Analysis Report
PUBLICIS GP-ADR (PUBGY): Free Stock Analysis
WPP PLC (WPPGY): Free Stock Analysis Report
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