OMC - Earnings call transcript Q1 2022

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon, ladies and gentlemen, and welcome to the Omnicom First Quarter 2022 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference call is being recorded. At this time, I'd like to introduce you to your host for today's conference, Senior Vice President of Investor Relations, Gregory Lundber. ahead. go Please

Gregory Lundberg

and we've this release along you posted call. when Thank and our quarter version be Vice call. the An presentation with as well today's first Executive On press today Good available review me for today earnings archived President Executive we'll Angelastro, as With and a call Chairman a Financial are omnicomgroup.com, XXXX Officer. Officer; our afternoon. Phil joining Chief a covering John website, Chief information webcast concludes. of will Wren,

read our I'd forward-looking information Before to at investor made we start, are like present to have Form and our may statements of we non-GAAP these XX-K. expectations. actual factors remind in including the other everyone and could our Certain to and statements, of our statements presentation. the materially our forward-looking financial differ earnings that results XXXX listed end included statements, cause the that today are in materials filings, Relevant SEC constitute

the will of discuss certain non-GAAP measures. During call, also today's we course

GAAP the find comparable the nearest materials. in the these presentation to can reconciliation of You measures

We our After from for results will the Phil John the our review I'll now the questions. will your over of we business John. then call call with an quarter. will remarks, to our begin up prepared for open financial overview line the hand

John Wren

thank for today. joining you and everybody, afternoon, Good Greg. you, Thank

are first We results. our pleased to share quarter

the to I performance, address Before in want our war I the discuss ongoing Ukraine.

to been and admire was contact our region in humanitarian regional this the safety senior around tirelessly to and culture country Czech of well-being Slovakia, continue been and and colleagues was necessary deliver honored to We people support in whatever tremendous displays offer families. and company the Bulgaria from Ukrainian horrific and assistance work bravery Ukraine coworkers they lead their the with extraordinary end help long Republic, to to I'm Romania, onset truly of and our will the our have Ukrainian in gratitude support. the We as meet few teams have strength. from caring continue my It a world with for assistance selflessly such a families. to resolution our to be remarkable Ukrainian the and to war. see. remains compassion and of law, continue continue to I war, the constant defend a the their providing and leaders hope is to I for to atrocities our people needed leaders and witness colleagues in to their privileged as protect We've Ukraine. will Since ago. our our and agency colleagues. of to our a unity peaceful focus want that I extend weeks Warsaw Hungary our to an that Poland, their these Omnicom needed. as support

decision now for growth increased to XX.X%. We our operations. withdraw and quarter the to financials. our margin the our Russia with operating of organic expectations made exceeded Turning dispose of from and We our

a end February. of result, business As for our reflect the the Russian only through financials quarter the

will from remarks. charge the provide of We in the effects Ukraine. the details arising a war also took Phil his during more

disciplines. quarter Our very all performance was strong the in revenue across and and growth margin geographies

line in Operating for businesses basis was XXXX. X.X% the profit XX also quarter, performance with while making our revenue for to consumer I revenue margin continuing was our agency branding, their the clients digital efforts the effects charge economy. costs Earnings rapidly Ukraine management in our marketing, digital in up e-commerce and to complement want investments are arising XX.X%. that the a This higher their teams evolving the share charge, in versus the strengthen for margin at Our the of excluding excluding than quarter, reflects is from growth. experience, transformation strong growing the $X.XX, very points tightly per XXXX. managing war

flow our dividends, primary support sheet Finally, balance of remain share very and and strong cash acquisitions our and cash, repurchases. uses

media management, within During across quarter, the to e-commerce, connected the and and Marketing delivering accretive expands experiences Precision internally and in experience further invest and areas customer acquired Digital, high-growth quarter, the commerce through health consumer continue acquisition TA within Throughout media agencies like The we transformation consultancy. MarTech, the digital Precision Marketing, paid group. the platforms content owned, data the leading are capabilities and In commerce acquisitions experience CRM environments. and and a our sector. digital we transformation, group, analytics, in digital earned global performance

this highest ID the for enabled our It a by person-based marketplace. of of first-party control Omni All precision framework post-cookie ID, be a CRM identity and open of built system. solution, delivers Omni is proprietary possible reach and part operating is governance. that privacy data compliant delivering is and future-proof our degree management, Omni is and to

congratulate done, take our continue diversity very our with technology Pineda our our improvements something our results. progress We're workforce these and XXXX. pleased Board XXXX, meaningful in our pride a new in now take investments to I we especially data throughout areas the we're Patricia to we as of clients moment Overall, Our high-growth members of best-in-class of capabilities extremely talent our saw across will equity At to of want is The we and diversity drive service end improve in United entire and levels Gerstein. all organization. in in States. we throughout to well Salas in, Omnicom's not have and Board to Directors: welcome inclusion continue and quarterly two in and to positioned professional Mark the diversity, us the and future. look

to high XXXX increasing for full in anticipate full business want the While the for compassion the for between pandemic war X% we the XXXX, ongoing operating Ukraine, at continue we the we delivered a in our to as remain strong strong the in that risk year year XXXX, remainder markets around margins growth plan and integral I'm agencies global supply given I economic strong effects and to clients' off your we'll for a level our we dedication. year, our the people the of forecast inflation for businesses. the the in of posed we growing that through are the oil world to of start given continuing the and across thank delivering the this by cautiously first higher and organic operate and X.X% our are continue same our cycle partner to chains With in XXXX. confident prices. said, quarter, an performance disruption

clients. our You to produce have incredible work continued for

drives Your resilience defines who company. success, our we as not it a are only financial

So for thank Phil you a Phil? again. financials. over once to look to at I our want turn the closer now call

Phil Angelastro

and John, to Thank taking afternoon. Thanks, good the today. join for time us you

see first Our It's our resulted quarter results were disciplines. one momentum, growth the strong. every continued across of to very in good which

the Russia were to Before the go the X, war as of our our details, that Slide announcement to of in withdrawal charges we from Ukraine agencies your and like the our profit the into operating fact on please impacted effects well as draw by related negatively EPS to there. where to attention turn I'd

a And dispose all the during $XXX.X million. charge in committed to of We Russia. have businesses actions in sold of our resulted quarter, these of pretax are or

As profit or million million of was a of down QX result, to $XXX XX.X% operating $XXX.X XXXX. compared

our growth related of additional strong Our to down revenue. was rates plus million organic offset charges tax impact was elevated an foreign non-deductibility XX.X% to $X.X excess tax acquisition of and the rate Reported Russia. by due withdrawal as negative charge in of revenue revenues the were of the from exchange disposition slightly

shows Slide which X, non-GAAP amounts. Turning adjusted to

last was margin charge, Amortization our You slightly adjusted EBITDA XX.X%, last quarter and the after operating above were $XXX.X last profit can as our profit was expense flat see flat a adjusting with also year. operating result, slightly and And for above year. was non-GAAP EBITDA first year. year-over-year, million, margin

of from recorded million, of As profit included $XX in year's a gain was which the quarter. last operating reminder, a sale a XX.X% the subsidiary margin second

full net share, adjusted As John comfortable are first of guidance million the X.X%. for EPS for shows with we XXXX. the said, for $XXX diluted up the year XX.X% per $X.XX of of X and non-GAAP amount income quarter still our Slide

are and geographies We businesses environment that this pleased well as our with underlying the strong work performance across growth organic as travel normalize. to and and continues

more Let's detail, some on now go into X. beginning Slide

expectations in our quarter of rates consistent QX XXXX of cycle from revenue April our X.X%. on year. Our organic $XXX they the quarter. by will dispositions points. approximately XX, is we and the revenue result strong a discipline foreign exchange primarily of stay by after which The of reduce impact or was U.S., of our acquisitions decreased revenue for we through rates The media our by from percentage X.X If activity impact X% the and This will by second decreased estimate where as was X% the exchange revenue were and the in growth impact rates foreign the our million. net advertising and XX.X% second with and disposition

in of XXXX. this year. be negative dispositions, to by the to second full for approximately on reduce from of in of expect based quarter the our revenue acquisitions, date, businesses our And deals expect reduction approximately disposition Russia, dispositions, completed X.X% We including the net we to X.X%

business total two and first by largest points is the on Now last in the changes our year. X. with our creative the XX.X% our of our discipline momentum media, organically Marketing continued from posted of and Advertising quarter our revenues quarter, Slide up organic grew total agencies. Precision revenues, the category, let's look X% in and growth now in at XX% in quarter approximately both media

for continues in retail ways. clients' was and e-commerce seeing is strong Commerce XX.X%, XX% and agencies compared growth branding issues. benefits XXXX, and engage DE&I Experiential in-person to widespread led Middle of QX and and especially and brand spin-offs, to work being growth Brand because clients We're global ESG the and in focus reputation continued perform brands unique of These our corporate led up increased our events negative particular, for activation. with build they from demand were demand from to digital Consulting organic in the looking data strong an DTC number also solutions. in In analytics media, increase our Credera corporate East. by reflecting and Our customers Results of loyalty XX% architecture MarTech, capabilities are exceptionally on around in by transformation, had important well. events.

year, pickup by X.X%, in pickup a As a in demand post-COVID support look in a retail from quarter adapt activity up growth to across was was very and environment. X.X% PR but clients both strong this adjust Execution forward grew we as we reflecting physical long-standing clients by overall choppy will and led Healthcare as activity. and positioning. marketing continue and likely with XX% new and post-pandemic be agencies. growth up strong to field their performance expect the our clients

Europe, Slide growth and by our its media, across and all U.S., led strong was and we're X. Public also In growth saw The to solid rates Asia-Pacific Relations. organic Turning pleased our which Marketing, Outside advertising experiential regions and by the was driver, Middle saw of within key by virtually experiential these each and PR. XX.X% was advertising the We a as growth driven media. was and Advertising every and of U.S., was region that growth region, strong was growth and Precision organic in Media East, in and growth the led of disciplines.

this offset revenue XXXX, stable. two-point at shifts of QX industry clients revenue the were Relative our a high disposition in driven first increase broad was clients a from clients industry. of sector on of in this only the of of the the a that in quarter and by But Looking fairly concentration distribution had XXXX. in Slide The reduction by change technology, business notable to travel remained entertainment in largely X. a by industry

despite amounts QX and in costs, largest move comparable salary Adjusting consistent impact growth Salary-related with the total, subsequent XXXX. our were percentage acquisitions increased operating expense comparison our is for related the and dispositions as you investments revenue, X.X%, related category to year-over-year revenues, excluding made and XX the our same Slide service revenue, year-over-year significant of the our of XX and in basis look not in by because activity service In for the a levels of the were level Let's this by to down income When continuation expenses our operating the acquisitions. XXXX as our pickup quarter. on of down XX% costs statement dispositions year. roughly of the and dispositions, at operating business. review strategic now business points expenses

XX%. million million quarter, run year-over-year SG&A amounts There's normalization in were continue $XXX I and $XX number is Adjusting forward. third-party XX% real approximately and that estate costs office, around XX our by and in They our to of decreased to on pre-pandemic of efficiently we from to to offset were one the offset from XXXX thing as were charge dispositions million by primarily million service revenue of business. in linked of an this remember regarding people X.XXX% businesses. our notes. been and like of onetime down now dispositions year. to interest approximately a increase approximately with X.X% revenue, of expenses XXXX service early by X.X% going would for interest was other portfolio. months less year-on-year level costs our expense similar costs, increase $XXX were lower redemption our of line our At growth directly acquisitions rate. expense which $XXX or Occupancy SG&A this an for a costs increasing related related highlight Please in to level had the partially up due has a manage to rent changes are to QX to the returning and Third-party other this occupancy The basis revenues due in

and million $XX million interest interest to of was total compared this expense Our income. quarter just quarter that net million $XX $XX

for expense of run remainder interest rate. to the expect XXXX and net that QX approximate We

of the our tax remainder this of war rate Ukraine. in expect approximate effects the the to for We our adjusting after to for the charges XX.X% year rate from similar quarter arising the

the Our down second diluted the X.X% half in to of XXXX. was first XXXX share primarily and of quarter activity our due repurchase in count share

flow working flow We generally year-on-year. turn for activities, are us flow changes free on Ukraine to Adjusting Free basis. million, flow portion positive for excluding million Slide net the define free capital, the $XX now our cash Let's million effects XX cash as in $XXX cash operating arising war performance. the by for was provided annual an of of down charges in the of flat cash cash-related cash from $XX was of which

to million common used dividends to pay uses shareholders our million we cash, non-controlling Regarding of and $XXX another $XX of shareholders. to cash for dividends interest

normalized items of were $XX expenditures capital Our to net million. Acquisitions of million other dispositions were and $XXX back levels.

acquisitions schedule. the of Slide approach disciplines. emphasis aligned highlighted toward were were in allocation our the on $XXX There way million debt This annual quarter the mix of changed. is quarter. XX themselves. stock $XXX long-term presentation, As maturity our $XXX million at This this during credit, not to stated overview XXX of first the back our included during capital our changes debt liquidity in And present of this range million the vary with our purchase an is may as But faster-growing our overall million. puts outstanding pursuing TA net. historical and us Digital philosophy opportunities of lastly, strategy have our in and repurchases and no

of was As XX, our times. March X.X total leverage

our consistent a prepared questions In operator, credit XX.X% on and addition cash of our you. end allocation. remarks my $X answers. consistent extremely have sheet, and and program the XX These the this invested revolving the operating XX.X% Slide $X are equity. facility. to lines short-term shows $X.X on please performance reflection of on our U.S. we strong by At XX billion investments on which commercial billion backstopped open Thank billion I'll the strong point, capital to also XX, months paper capital March of for balance for a today and and and approach returns ended both are return return

Operator

line Our JPMorgan. Instructions] from [Operator ahead. Please Karnovsky the first question of David comes of go

David Karnovsky

organic significant for outlook, similar strong deceleration does are Just what in your not think appear a relatively in comps. assuming of really I QX, the to on the the given year results rest and it the on you're

with you and John, supply impacting bit inflation, little on conversations of could on how you're guidance? that's your speak more wondering, to the having view and clients Just if economy kind the chain, a

John Wren

for the question, Thanks Sure. David.

first, bottoms-up Our practice-area-by-practice-area. of a sort guidance review really is company-by-company, on based, sector-by-sector,

spoken Europe, multiply to confident at I their I've you in and I've and client and and uncertainty. years, think there how a United time we've is we have not about we're brands to in recognize that by I across enough after this this ever our And spending is spoken first XX but just four, out stepping few point, our And our we the thing uncertainty this their to, back first from and every the many that States that's quite commitment the the or that there. my quarters on performance forecast the estimates. quarter, raised think been raised. They're

conservative. is it Now,

have to that it You throughout work remember the you get more year, uncertain And a year. project is. is that the in comes there the up out further the

how if know U.S. don't but inflation, end. chatter impacts the of to a how are mean the argument going the look are probably are going is in things wars there these what other made any know strong or to going peak be the don't I You to we go that to at we're long be. at you

we're maintain we're to X% going our year that least between very comfortable we last going year, and which to that XX.X%. achieved we So, with margins do -- of we're and what estimates X.X% the maintain for was said, this at

David Karnovsky

maybe segments big these quarter, acceleration did Okay. I below to execution And we so see and your the of the in events be less XXXX, support, a the execution. follow-up XXXX, well and for for experiential then get would views like were areas and interested running on still on maybe just outlook. end a at

lift of how pre-pandemic levels you're or towards seeing a much expecting restrictions fully as go away? Just wondering,

John Wren

the into this to I things the Well, the the hard that more these month -- And It's I long. a a generally close an answering it down execution large believe XX decided would ago, business windows no And can when the And it. ties then to down asked. than question that's have way Shanghai, weeks. but interesting a Shanghai, that tend So extremely to that last extremely, right? occurs when question. it's If the bullish. exactly you little is you to XX planned, was as they you with Chinese be generally closed been not between as city and assign do

bit that. So, we're conservative a

We are area. confident the in most the in We're of Middle for East, Asian Europe in this seen, U.S. we've our forecast but for forecast that we've the and discounted. our confident forecast

Phil Angelastro

businesses I think been it we've out of come are for you expectations visibility. It's COVID. a half certainly get got growing of have done when our disciplines the out to those the a Certainly, of to coming and probably subject COVID, the or ready getting job better way year. describe more good less two to second they've

that in So like the their a right clients' project-based largely look spending But and we forecasts their conservative of the since terms experienced performance. probably year, uncertainty the half little subject as China they're could more think I that here being with are are occur experiential of at especially second given we're more the happy of some changes to than now. in ones most bit plans

little we're certainly to in here happy performance, operating half, how they're there's to in but less disciplines So, second our going perform those a sitting visibility particular, today. with two the

Operator

comes go the of with Citi. from Bazinet line question next Jason ahead. Please And the

Jason Bazinet

ask asked to to a I'm don't I ask if question -- get I guess want it. just because cynic, tomorrow, I going by I'm sure this I

which outlook, XX.X sort the in prior usually do said, So your don't it the with at margins as you the is of relative to first unusual, flat quarter increase outlook. the in

this wrong lift think just the organic a ran you because than hotter I is growth? cynic of Is would that in a inflation say the anticipated. interpretation

John Wren

is. Yes, I'd it say

Phil Angelastro

baseline the margin operating $XX think, sale of of on million. of reminder, included gain year, of year XX.X terms I One in expectations the of prior for Yes. business a the

expected if you focus or performance just operating that's But So, what improvement year. after don't know there some you're yes, the for perfect. is I

Jason Bazinet

helpful. No, super no, that's perfect, you. Thank

Phil Angelastro

Sure.

Operator

line next the Please go And comes of question ahead. the from Nollen Tim with Macquarie.

Tim Nollen

you QX. you in versus It's do on look this strong a very I the QX if normally And -- QX the and if at a look number, 'XX up versus versus QX but 'XX, don't result acceleration 'XX in flat looking basically XX%, basis, my QX in And QX organic. QX, were stacked a right. you numbers basically of at if you're I'm kind

So, year. And growth strong comparison really would the just year-over-year said XX.X% how at you coming very QX, QX. I and you've uncertainties full a I wonder about give be surprisingly idea were if to whopping think up thus us so wonder, can far in the outlook given last you it's helpful. a all and second figure. year the understanding on? everything on any Again, in half That

John Wren

don't answer, added we prior provide things our suited Sure. don't strongly And the about, impacted. absolutely need answers years But at to we're that emerged with I'm cleaning COVID the from last we to if for at that I were your COVID, our this I portfolio forget precise fully we two sure today. think not year just if also, what impact portfolio. is of well four but and that think very a anyone you clients to a I know is very, to year-to-year, question. that we look When feel up want rate. recovery

If you okay can follow up, it's to.

Tim Nollen

a helpful. other a factors. of lot mean comparison -- I just in are that's difficult No, up Yes. It's coming understand it's there QX. I very

given that guess it's for the half optimism to think good hear the Just second year? growth rate high the the of understand QX trying to base. about on how So growth the to I rate

Phil Angelastro

Yes.

the the last the answered profit, that when the sale from of gain has the sale, from Phil QX question. that terms proceeds In he

Phil Angelastro

Yes.

in the year. that first perspective, a from the of baseline we 'XX revenue COVID of of coming the last far principally out some as QX starting of as think last of goes, were Tim, hangover the quarter certainly, COVID, I was quarter as

very, high pleased bar quarter's this So, to We're relative speaking, very results. relatively for performance certainly year. the wasn't last quite with the as

second last year again where deal the we first that As the and XXXX down a bit of jumped a great was weren't head quarter because quite all performance numbers the comparable. really into quarter, post-COVID, the second quarter were --

bounced So in we're the is quarter the very in a where But had we've some of it encouraging, terms business back baseline of facing performance finally quarter first and of QX the is the kind 'XX. got certainly, momentum. in

We momentum as we at of second year. the half expect look the that to continue

there's said, visibility little more and a today. John less a As uncertainty in the back we little where sit half from

Tim Nollen

Sure. understandable. Yes,

I if such the and four just of organic growth Now the year, a stronger QX less the all basically, just And year terms QX, quarters, of more was back versus look in precisely. your now reversed well, at percentage number QX almost last prior that. QX last declines or

a your just Obviously, that's and the to forecast Ukraine countries, on Europe. good confident still comment et thing? pretty growth? as Russia other maybe the west, for you in could if you're Could maybe optimistic in bit more. optimistic, So, pretty I move John, the You regions, border aside, further I that obviously see. neighboring Poland, are else you the you're that on you regions, that, tack growth cetera. could And on anything wonder comment just one little last said, other you

John Wren

bullish of have had coming might the taking the all the opportunity ago meet great weeks the from is one border in border our in mentioned remarks, had to significant business, Romania populations in are. not of the that that numbers an what about terms up that requirements my and those the their two they're all prepared Ukrainians leaders business. a And were as care suddenly Poland of the I've all their are disciplines way across concern I percentage Well, the but from they've was of the all thing because And through surges Ukraine. primary of

So and France, Netherlands and Belgium so shape. Italy, the great all big very, are moment, the and the Germany at and they're -- also which very although strong five, are performance, U.K., Spain,

Operator

we'll Next, Capital. line with Dan to of BMO ahead. go Please the Salmon go

Dan Salmon

I questions. a Okay. have of couple

past, held being different important to you've assets generally about that First, AdTech view as to that's remain data also MarTech, Omnicom or John, in it the about whether talked technologies, agnostic you well. for third-party

then in ID I'm little question picture more interested of my technology as percentage you a but the does verticals continue? where of Or uptick bit in. to And landed for you just it that about I'd step mentioned that just Phil, of to specifically, a about the like Is So is, the that a bigger this represent direction? in second, hear the -- revenue. quarter? Omni matter view little the trend a it's like see vertical that a would

John Wren

it. privacy if that before to out, have Well, business Omni access, quite that a various else had very it the at When it not it, bit ID look to is works revenue unique. of bought clients proving the of better they over well. it it available, we on own they access a money testing and something. that proving period tells data time, We've something the spent global everyone long same you very that laws, that's who bought actually was a given Well, works they

it's sale. it their for not they're still and away So giving clients to

for that clients. the or doesn't the insights our data data client so So, can there's we're of around the Omni and is fact missing. in a trained over they're willing I'd that to significant much. -- of about our we've utilizing no that And the And for are been the it particular important ID long, they staff most with have deployed the in that mean you number insights the what in secret to the to we've data aspect what our draw have be too at it analyzing It's properly the we site significant share world it, sauce largest and what because benefit most and willing of sell. publicly do XX,XXX you

So that, not other makes I'll than publicly. prepared a what Coke Coke that describing do be and I'm to

Dan Salmon

enough. fair Yes,

Phil Angelastro

On the...

Dan Salmon

Just on technology. -- yes, tech

Phil Angelastro

Dan. the second Yes, question,

just to a vertical in our Omnicom's total up. the industry I'd as to revenues it's in overall high and So tech say revenue largely as down space. is relative things. of Travel percentage in of clients of my a indicated prepared two the due our or that combination the had a ticked mix, One a revenues tech business disposition went concentration a of I that the remarks. change entertainment in

So almost good clients. our all growth -- some disciplines tech we've had across and with of

grow, happy tech any and a some think about to don't X,XXX-plus of though, very see lot love We're any industry with I by to tech. we or I we those as others. move and overall, space But grow to percentage continue it the every metrics consistently to number health offering as expect forward. care move when well our see quarter. with going have, we'd to happy I groups move a I we're has clients expect of and takes move be groups industry often, It they're points those the certainly, wouldn't for resonated think expect them those much too going you And don't us. to those to in it clients talk numbers. of

Operator

And Cahall we'll go Fargo. Wells with to next, Steven Please of the line ahead. go

Steven Cahall

year, guide sense a advertising of know business the rest bit to historically, indicator buying as makes why macro that. points. the the inflection of think a done conservative I for the you outlook first, a of has leading Maybe you've of a of been And gave the I media lot given certainly

be warrants either business to things at and you down that is look cautious? slowing been especially media there's your just and the back are if that it you step in this or wondering, just strong year, picture itself bit start evidence with the inflecting? a to more any So overall little just Or buying

John Wren

its changing existing materially in that's And clients has opportunities the little that or When our But agree going anything very world, and everything for look statements. history, Well, happy at business. been don't with been media With business we last good on with the part very at then inflation successful, new always moment. of been to we're specific that's see And the presented. element be with a both business you bit warrants conservative. the I it's overall.

spend services. advertising going some and proven were is money -- a what it. the of started more since to bit the to cautious to environment I'm the a what I've been consumer of like see have always have it adapt streaming thing of They it my where to other And that they in the yet works, People want, more in -- and be is The you're these little think little Hulu to might amount they're get always has anticipating really adapt will it. think the view, they to others in predicting be seen, which be others it I going I wars. more and

I we're think will environment process this -- today that speed in the up.

with comfortable portfolio our very though. So

Steven Cahall

And maybe then just a follow-up.

set that's about a media Your comment to basis as has I know or inflation. buying helper revenue where at inflation times whether been growth in their spend. clients to ad a that your use

at Or cycle, this your So point in business? right growth the it do inflation inflation you to helping a view is the as risk now? organic profile

John Wren

of impact in business segment you inflation. and my Well, the asked me about Okay. a

we're the our the As I margins subsidiary because what why sale bottom-up, we're our unusual is. comfortable as of build said consideration, from -- our gain last the a holding last same that's forecast actually earlier, from into year we holding had we we've looking of that we're improving year. And at margins taken and by that reality our the

components. spent deal of from wants to if the detail we So, parts moving the add and we a various that subsidiaries Phil our getting know in. operate time there's an great testing we're in don't markets that of And information awful I anything. lot

Phil Angelastro

Just a additions. of couple

automation and these related has have and pursue a job and But continue forecasts. outsourcing Overall, considered put And of agencies our to number are businesses we addressing. our levels revenue got the and relative seen because, in to efficiency a we in initiatives a managing off-shoring dealing it plans cost great certainly, structure, we've, flexible together done of challenges So we've business. some have with a other and our their their they ultimately, haven't it's as as challenge this to that environment John because need said, clients, to be reductions an environment stuff and got in and And -- to going any do expect continue they we invest in they sell continue to we invest continue them to and to want plans non-inflationary to spending continue environment. marketing successful the point, continue of provide to services to they are in the continue going agencies in the at that need are and to branding to stuff, they're our in clients going to this inflationary to a clients invest. or sell

somewhat the of of we're still we're optimistic very performance headed second 'XX. the the the for while where and business half, rest overall, So we're cautious in regarding

Operator

ahead. next, to Ben Please with Stanley. Morgan line of we'll go And Swinburne go the

Ben Swinburne

I question does Phil, us if reflect a was guidance don't Maybe, know Russia beginning answer just on is just I your for the year? you'd including guidance but a have and European housekeeping gave relative outlook XX.X, what of Phil, at quick the to And this, the you business margin of different John. for I guidance new 'XX? the for charge, couple guys any your wondering, the the

Phil Angelastro

Russia. Ukraine, $XXX respect the with this the Russia quarter we're for good. charge to that be specifically, we us not good, now million So the and We XX.X but may took excludes

and totally that on the John situation of been mentioned February. easy And obviously the hasn't were then deal call people largely this was remarks So on with because we an his had has what call. it -- when in in earlier to not and prepared unexpected it

from in his businesses Europe. our point. charge. changes conversations region, had run forecast from XX.X any the in who with So significant clients that in with this haven't but people haven't John add Europe, meaningful number seen our big we excludes We've forecast in can any our conversations respect European businesses at in. And color to we changes of seen a our with some that or

Ben Swinburne

I in both your on yesterday if saw was Got like e-commerce it. you sort thought wondering And of in I'm article topic, about businesses, in then areas. don't you I those rebound the this interesting. look journal exposure when another know you which at brick-and-mortar have a John, slowing of and

Are normalization area trend probably this the in more you on through in your over-index. see maybe I'd year. of interested And field performance results an the a marketing bit you of in that is a think of guys and traditional is be topic. I expect you your and rebound sort activity? you seeing that e-commerce in some discipline, sort of this that of something continue your maybe insights to retail

John Wren

Ben, says. all clients, have now deterioration noticed did -- of see to terms see both it that I back article with in not not honest, the I read be it at In see any our perfectly conversations and had being that e-commerce. yesterday. we I go I've and will what

And I've so, article. to today the quick seen is, answer to the evidence your question not support

Ben Swinburne

see wasn't business Anything rebounding is because your that outlook and your point of on from of to sure execution growing and -- that you in kind levels? I faster for is support view. discipline a growth pre-COVID business, a what back

Phil Angelastro

I'll go first in comments.

is think no. few significant our see I growth increases don't the to direct trends We what the answer were, expectations quarters. last relative in

done I They are, little our and some think project-based their of well. than quickly But more they're investment they've businesses. change some respects, other solid in clients a might bit businesses.

profile than to that do them certainly was business. growth well. to Their our a little continue lower We parts expect of other probably

for robust as are rest year provide, of see look for second our the as we expectations the -- for As the you at you that the them when rest breakout business. the not the can of revenue

Operator

go to Research we'll Please the Craig ahead. of line with Huber Huber next, Partners. go And

Craig Huber

also there privacy now? your couple for both of that last business? my privacy example, with government-mandated iOS, for of do the right there, that John, out or first How question, Is over you indifferent sort good, the years. sort bad with data of but changes view changes out all

John Wren

Well, it's changing.

absolutely You're very right, rapidly.

of working don't already just this people he's just privacy that but as as attorney that issues on spent know matter staff, very, who career fact, dedicated within other experienced, on As the a on well brought the we were Company. I a very his entire

because up agile in net-net, haven't changes years think stakes today ago. whatever to day we jurisdictions as the and agile expensive good made we're can time. And adapt we'll I decision going the any I is happier with is huge benefit I'm we pretty constant put And And investments made and that this environment are ground. to a come adjust long whatever be and strong decision think or from the various than for theme we a as the our be with. to that much several we that

Phil Angelastro

And those changes the complex to with and they reach to the in reach. need make make that technology appropriate are and tools the decisions help to reach party the environment, we think benefits find think for make third I clients skills independent the only and certainly continue to the it more it because to consumers to going Yes, them us to an consumers. trying we're they're

as certainly, a it positive. view complexity the So we

Craig Huber

raised And run the XX first for organic time in in revenue also, that years, this you Company, John, said helping the can early you the calendar it's to year. you've recall outlook on

just issues us bit of maybe right compelled on felt out there, Just your you the seeing huge could to are that. little change meat with? why if grappling more you you all there now macro a people number outlook What given help exactly are out that

John Wren

organic to growth. components several are There

is that's full year periodically at a every all on. practice areas networks changes haven't competitors that prior going you at us successful business position, of during some year our the there's that corporate with One what's subtle point which on because here leaders given and strong in our are of But ground, are you going bottom in changes, 'XX the of a truly inevitable yet even is wins very losses and one up, having dialogue the or -- other, and XXXX new which and the in and us entered a us of We've ground, very the is our confidence. about just not had had the on either. lot built defining this experience forecasts sitting from weekly a

can we as close on. as we're So, to what's be going

Phil Angelastro

given question increased haven't for have growth the you your for be you'd organic year performance -- we us we the first is some to in asking performance when in the -- were full regarding simple think where probably is guidance. at a great relative the on if the math. it guess of we it's guidance my And I February, quarter, didn't Yes. And as you address look different

uncertainty by So, optimistic but performance great of performing. back how about and we're expectations year. yes, are change still first quarter. the our we're some where are our think Certainly, in now the the we right a the was driven half, I And is with it in businesses that the there comfortable was rest

John Wren

And math. we're good pretty at damn

Operator

questioners And in queue no other we have this at time.

John Wren

coming I today. want us forward weeks. speaking with to And the thank Well, you and you of with in we spending for the time us really speaking look all with to

Phil Angelastro

you. Thank

Operator

that and And for participation Thank conclude our today. you. does you Thank Teleconference. your using AT&T conference for for

You disconnect. may now

Omnicom (OMC) 19 Apr 222022 Q1 Earnings call transcript