Demand for digital advertising helps Publicis raise its growth prospects for 2021

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The Publicis group logo is visible at the gathering of startups and high tech leaders, Viva Tech, in Paris, France, on May 16, 2019. REUTERS / Charles Platiau

  • Underlying Q3 sales up 11.2%
  • Beats market consensus of 7.8%
  • 2021 organic growth of between 8.5% and 9%
  • Europe returns to pre-pandemic levels, US and Asia above

Oct. 14 (Reuters) – French advertising group Publicis (PUBP.PA) raised its outlook for 2021 on Thursday, as a global shift to digital media and e-commerce helped its third-quarter organic growth exceed expectations of the market.

Demand for digital advertising has allowed Publicis, which has sought to attract new customers by promising targeted campaigns based on large data pools, to return to organic growth this year for the first time since before the coronavirus pandemic.

Publicis, home to advertising agencies such as Leo Burnett and Saatchi & Saatchi, said it also benefited from new business wins in the third quarter, including Walmart (WMT.N) and Planet Fitness (PLNT.N).

The third largest advertising group in the world behind the British WPP (WPP.L) and the American Omnicom (OMC.N) now expects organic growth of 8.5% to 9% this year, against a previous forecast of 7%.

“The continued outperformance of our data and technology capabilities has once again demonstrated our ability to capture a disproportionate share of the evolution of customer investments to digital media, commerce and DTC (direct to consumer). “CEO Arthur Sadoun said in a statement. .

Its digital business Sapient recorded 20% organic growth in the United States, which is Publicis’ largest market and the source of more than half of its revenue, with data company Epsilon 13% above the level from last year.

“The potential for Epsilon to develop outside the United States is very interesting,” Sadoun told reporters when asked about the unit’s dependence on its domestic market.

“Today we have a small base (internationally), between 5 and 8% of turnover … but this base is already growing by 40% over the first nine months.”

Underlying sales in the United States increased 10.9% in the quarter, while Asia-Pacific posted growth of 12.5%. Sales in Europe are up 10% from last year and are back to pre-pandemic levels.

At the group level, underlying sales rose 11.2% to 2.6 billion euros ($ 3 billion) in the third quarter compared to the same period last year, and topped levels of 2019 by 5%.

Analysts expected 7.8% organic growth for the quarter, according to a consensus forecast provided by the company.

($ 1 = € 0.8643)

Reporting by Milla Nissi and Valentine Baldassari in Gdansk; Editing by Alexander Smith

Our Standards: Thomson Reuters Trust Principles.


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