Exhibit 99.1
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FOR IMMEDIATE RELEASE Contact:
Jan A. Sneed (212) 546-2422
Steven G.Felsher (212) 546-2440
GREY GLOBAL GROUP REPORTS SECOND QUARTER RESULTS
New York, New York - August 12, 2003--Grey Global Group Inc. (NASDAQ: GREY)
today reported its results for the second quarter of 2003.
Results
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The Company reported commissions and fees ("revenues") for the second quarter of
$319.9 million, an increase of 10.3% ($29.9 million) from the same quarter in
2002. For the six months ended June 30, 2003, revenues were $617.6 million, an
increase of 7.3% ($41.9 million). Of the increase in revenues for the second
quarter, $23.6 million was attributable to currency movements principally
related to the weakening of the dollar against the European currencies. Of the
increase for the first half of the year, $37.7 million was attributable to such
exchange rate movements. Revenues in North America were up 4.9% for the quarter
and 3.1% for the six months while, on a constant currency basis, non-North
American operations reported revenues down by approximately 1.0% for both the
quarter and the six months.
Income of consolidated companies before taxes on income grew 163.4% for the
quarter to $12.1 million and increased 54.9% to $23.2 million for the six months
ended June 30, 2003 when compared to the respective prior periods. Net income
was $4.7 million for the second quarter of 2003 and $9.8 million for the first
six months compared with $1.7 million and $6.0 million, respectively, for the
corresponding periods in 2002. Currency movements did not have a significant
impact on the consolidated net income.
Basic and diluted earnings per common share for the three months ended June 30,
2003 were $3.33 and $3.07, respectively, and for the half year ended June 30,
2003 were $6.73 and $6.19, respectively.
Company Comment
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The challenges faced by marketing communications businesses since 2001 are
continuing. While there have been signs of stabilization and buoyancy, they are
frequently offset by neutralizing caution attributable to economic weakness and
uncertainty in many parts of the world.
On the positive side, we continue to add to our client roster and, most
importantly, take on additional work from our foundation global accounts--like
Procter & Gamble, Mars, GlaxoSmithkline, 3M and British American Tobacco. This
is the most satisfying validation of our singular mission to do what has to be
done to increase our clients' businesses and grow with them.
GREY/Second Quarter Results - 2003
Page Two
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Grey Global Group ranks among the largest global 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, brand strategy and design, 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
<Table>
<Caption>
For the Three Months
Ended June 30 (Note 1)
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(in thousands, except share and per share data) 2003 2002
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Commissions and fees $ 319,946 $ 290,082
Income of consolidated companies
before taxes on income 12,147 4,611
Provision for taxes on income 6,174 2,446
Minority interest applicable to
consolidated companies (1,455) (804)
Equity in earnings of nonconsolidated
affiliated companies 226 309
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Net income $ 4,744 $ 1,670
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Weighted average number of common
shares outstanding
- Basic 1,274,154 1,247,671
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- Diluted 1,394,287 1,385,226
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Earnings per common share (Note 2)
- Basic $ 3.33 $ 1.26
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- Diluted $ 3.07 $ 1.16
===========================
</Table>
<Table>
<Caption>
For the Six Months
Ended June 30 (Note 1)
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(in thousands, except share and per share data) 2003 2002
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Commissions and fees $ 617,589 $ 575,663
Income of consolidated companies
before taxes on income 23,240 15,004
Provision for taxes on income 11,388 7,127
Minority interest applicable
to consolidated companies (2,452) (2,651)
Equity in earnings of nonconsolidated
affiliated companies 415 758
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Net income $ 9,815 $ 5,984
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Weighted average number of common
shares outstanding
- Basic 1,268,177 1,247,774
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- Diluted 1,391,623 1,383,073
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Earnings per common share (Note 2)
- Basic $ 6.73 $ 4.46
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- Diluted $ 6.19 $ 4.08
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</Table>
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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