HAVAS: Organic Growth: + 7.4% for Q1 2008
Revenue: EUR 345 Million
Net New Business(1): EUR 510 Million
SURESNES, France, April 22 /PRNewswire-FirstCall/ -- "Havas reported organic growth for first quarter 2008 in line with expectations. This confirms the positive trend observed throughout 2007, underscores the validity of our business model based on integration with digital at the core and reflects our stronger position in key markets," Fernando Rodes Vila, Chief Executive Officer of the Havas Group. 1. General comments Havas reported organic growth of +7.4% at constant exchange rates and consolidation scope. Q1 2008 revenue was EUR345 million, an increase of +2.5% over 2007, despite the appreciation of the Euro against the US dollar and GB pound, which had a negative impact on the Group of EUR20 million over the first three months of the year. Net new business for the first quarter was EUR 510 million, 33% higher than the quarterly average in 2007. Finally, all the Group's key performance indicators are in line with expectations. One of the highlights of the first quarter has been the expansion of the Group's presence in the UK and in the US thanks to: - the acquisition of BLM, the leading independent media agency, which has combined with Arena Media Communications (part of Havas Media) in a deal which doubles Havas' media presence in the UK. In addition, BLM Quantum in combination with Media Contacts becomes the second largest digital media group in this key market. - the acquisition of CAKE, the leading independent branded entertainment agency in the UK, which will join Havas Entertainment (part of Havas Media); its results will be consolidated with effect from April 1, 2008. - the acquisition of KADIUM, a strong digital agency in California, that we have merged with our advertising agency Euro RSCG San Francisco in keeping with our strategy of integrating digital vs leaving in a silo. 2. Detailed calculation of organic growth by region EUROPE Growth was sustained across Europe as a whole, with Spain, Portugal, Italy and Germany achieving double-digit growth; all the other major countries reported continued growth. NORTH AMERICA North America saw a significant increase in growth across all our businesses. REST OF WORLD Asia Pacific maintained its trend of double-digit growth. In Latin America, growth in advertising and media expertise remained satisfactory in most countries with the exception of Puerto Rico and Colombia. 3. Net New Business(1) in Q1 2008 Net New Business was EUR 510 million in the first quarter of 2008. 4. Creativity The BIG WON Report (Worldwide Rankings) ranked BETC Euro RSCG the world's 5th most awarded agency in TV and Euro RSCG 4D Amsterdam the world's 8th most awarded agency for digital, as well as 10th best digital campaign worldwide for Volvo 'The Hunt' (plus a 16th place for Volvo 'A Product of Free Will'). Arnold Boston's "Singing Cowboy" campaign for American Legacy was voted most awarded campaign worldwide in TV and 2nd most awarded campaign (all categories). Arnold featured in the Top 20 (no. 18) of the world's most awarded agencies. Campaign Brief (Asia Pacific) put The Furnace Sydney (Australia) in its Top 3 Hottest Agencies (under Aus$ 100 million). Euro RSCG Shanghai was ranked 8th and Euro RSCG Flagship (Thailand) 7th. At the first Asia Pacific Effies, The Furnace took Silver for its Skins (sportswear) campaign. At the Asia Pacific Advertising Festival (ADFEST), Euro RSCG Flagship won 2 Silver awards (Nanyang Sandals), while Euro RSCG India took 1 Bronze for Reckitt Benckiser and Euro RSCG Kuala Lumpur 1 Bronze for Penline Art Supplies. The latest RECMA Compitches Report (Media Agency competitiveness) ranked MPG UK 3rd in Europe and 5th in the overall table. MPG USA came in at 7th in the US ranking. Euro RSCG Prague, was named Agency of the Year in the Czech Republic for the second year running. BETC Euro RSCG was named Agency of the Year in France. Top Com Corporate Business (France) awarded Euro RSCG C&O its Grand Prix in the Strategy Communication/B2B category for EDF 'L'avenir est un choix de tous les jours'. Mobius Festival: A Best of Show TV award went to the INPES Free Hugs campaign by BETC Euro RSCG and a Winner each for PSA, TV Canal+ ('Brokeback Mountain' campaign) and Canal Sat ('The Experts' campaign). Best of Show Cinema In Flight went to the American Legacy Singing Cowboy campaign by Arnold Boston, plus 1 Winner in the Outdoor category for Dulcolax by Euro RSCG Dusseldorf. 5. Calendar The combined shareholders' meeting will be held on May 29, 2008 at 8.00 a.m. at the Havas head offices in Suresnes. Revenue for the first half-year of 2008 will be published at the end of July. About Havas Havas (Euronext Paris: HAV.PA) is a global advertising and communications services group. Headquartered in Paris, Havas operates through its two worldwide networks, Euro RSCG Worldwide and Havas Media, which are headquartered in New York and Barcelona respectively, and through a number of independent agencies renowned for their creativity, such as Arnold Worldwide Partners. A multicultural and decentralized Group, Havas is present in more than 75 countries through its networks of agencies and contractual affiliations. The Group offers a broad range of communications services, including traditional advertising, direct marketing, media planning and buying, corporate communications, sales promotion, design, human resources, sports marketing, multimedia interactive communications and public relations. Havas employs approximately 14,400 people. Further information about Havas is available on the company's website: http://www.havas.com Forward-Looking Information This document contains certain forward-looking statements which speak only as of the date on which they are made. Forward-looking statements relate to projections, anticipated events or trends, future plans and strategies, and reflect Havas' current views about future events. They are therefore subject to inherent risks and uncertainties that may cause Havas' actual results to differ materially from those expressed in any forward-looking statement. Factors that could cause actual results to differ materially from expected results include changes in the global economic environment or in the business environment, and in factors such as competition and market regulation. For more information regarding risk factors relevant to Havas, please see Havas' filings with the Autorite des Marches Financiers (documents in French) and, up to October 2006, with the U.S. Securities and Exchange Commission (documents in English only). Havas does not intend, and disclaims any duty or obligation, to update or revise any forward-looking statements contained in this document to reflect new information, future events or otherwise. (1) Net New Business : Net new business represents the estimated annual advertising budgets for new business wins (which includes new clients, clients retained after a competitive review, and new product or brand expansions for existing clients) less the estimated annual advertising budgets for lost accounts. Havas' management uses net new business as a measurement of the effectiveness of its client development and retention efforts. Net new business is not an accurate predictor of future revenues, since what constitutes new business or lost business is subject to differing judgments, the amounts associated with individual business wins and losses depend on estimated client budgets, clients may not spend as much as they budget, the timing of budgeted expenditures is uncertain, and the amount of budgeted expenditures that translate into revenues depends on the nature of the expenditures and the applicable fee structures. In addition, Havas' guidelines for determining the amount of new business wins and lost business may differ from those employed by other companies. (1) Net account wins, expressed in estimated annual billings. Full definition given on page 6 of this press release.
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