Exhibit 99.1
FOR IMMEDIATE RELEASE Contact:
Jan A. Sneed (212) 546-2422
Steven G. Felsher (212) 546-2440
GREY GLOBAL GROUP REPORTS FIRST QUARTER RESULTS
New York, New York - May 13, 2003--Grey Global Group Inc. (NASDAQ: GREY) today
reported its results for the first quarter of 2003.
Results
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The Company reported commissions and fees ("revenues") of $297.6 million in the
first quarter of 2003, a 4.2% increase, when compared to the same quarter in
2002. Revenues were favorably impacted by the strengthening of European
currencies coupled with modest growth in North America.
Income of consolidated companies before taxes on income grew 6.7% for the
quarter to $11.1 million. The increase is due, principally, to the Company's
continued attention to managing operating costs along with the increase in
revenues.
Net income was $5.1 million for the quarter as compared to $4.3 million for the
same period in the prior year.
For the three months ended March 31, 2003, basic and diluted earnings per common
share were $3.41 and $3.12, respectively, as compared to $3.21 and $2.92,
respectively, for basic and diluted earnings in the corresponding period in
2002.
Company Comment
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The Company's revenues for the first quarter increased despite a generally weak
global economy, SARS and the uncertainties of the Iraqi situation. Revenue
comparisons with last year were helped by the strengthening of the European
currencies against the dollar, offset somewhat by the decline of Latin America
currencies since the first quarter of 2002.
Grey Global Group companies continued to win business around the world
including, most importantly, new assignments from our major clients. We extended
our franchise with clients such as Procter & Gamble, Mars, GlaxoSmithKline, 3M,
British American Tobacco, Wyeth and others. This success is attributed to our
totally focused, unrelenting commitment to serving our clients' requirements.
Two of our new business wins demonstrate clearly the strengths of Grey. One is
the assignment of Nokia-N-Gage, the worldwide entry of Nokia into mobile
videogame platforms and software. This win required us to establish to the
client our ability to execute outstanding creative collaboratively and
simultaneously throughout the world.
GREY/First Quarter Results - 2003
Page Two
We also won responsibility for marketing the Visa credit card in Central and
Eastern Europe, the Middle East and Africa. The assignment of this significant
brand requires us to provide advertising, branding, sales promotion and other
marketing services in both developed and underdeveloped markets. This showcases
the coverage, vibrancy, quality and close synchronization of our truly global
network of businesses.
These wins, against top flight competitors, confirm the power of our network and
the strength of our business model.
* * * * *
Grey Global Group ranks among the largest global marketing communications
companies in the world. Grey Global Group operates branded independent business
units in many communications disciplines including general advertising, public
relations/public affairs, direct marketing, Internet communications, healthcare
marketing, and on-line and off-line media services.
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(Part of this announcement may contain forward-looking statements that involve
risks and uncertainties, and actual results could differ materially from those
projected in the forward-looking statements. The risks and uncertainties are
detailed from time to time in reports filed with the Securities and Exchange
Commission, including but not limited to the last section of the Management's
Discussion and Analysis entitled "Forward Looking Statements" contained in the
Company's Annual Report on Form 10-K and in other filings.)
(Chart follows)
Grey Global Group Inc. and Consolidated Subsidiary Companies
Condensed Consolidated Statements of Operations
For the Three Months
Ended March 31 (Note 1)
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(in thousands, except share and per share data) 2003 2002
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Commissions and fees $ 297,643 $ 285,581
Income of consolidated companies before taxes on income 11,093 10,393
Provision for taxes on income 5,214 4,681
Minority interest applicable to consolidated companies (997) (1,847)
Equity in earnings of nonconsolidated affiliated companies 189 449
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Net income $ 5,071 $ 4,314
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Weighted average number of common shares outstanding
- Basic 1,262,132 1,247,801
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- Diluted 1,389,996 1,381,557
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Earnings per common share (Note 2)
- Basic $ 3.41 $ 3.21
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- Diluted $ 3.12 $ 2.92
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1. Unaudited and subject to year-end adjustments.
2. After giving effect to amounts attributable to redeemable preferred stock
and for diluted net income per common share to the (i) assumed exercise of
dilutive stock options, (ii) shares issuable pursuant to the Company's
Senior Management Incentive Plan and (iii) assumed conversion of the 8 1/2%
Convertible Subordinated Debentures.
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