Publicis Groupe announces strong action amid coronavirus crisis
French advertising firm Publicis Groupe has posted a 17 per cent growth in net revenue for the first quarter of 2020 compared to the same period last year despite challenging environment occasioned by Corona Virus crisis. The organic growth in the US creative and media business and the robust performance of Epsilon, the digital marketing business it acquired last year from Alliance Data systems bolstered the steady performance.
The group recorded flat growth in February even as the China business recorded double digit decline with the situation escalating in March as the pandemic spread beyond China borders. That dip in business was however compensated by North America returning to growth, including Publicis Sapient which is slightly positive in the US.
But as the virus devastates all facets of the global economy and businesses continue to bleed under its overwhelming consequences Publicis Groupe has announced a raft of measures to cushion its business and preserve a solid balance sheet. It has announced a 500 million euro cost-reduction plan to assist it be recovery ready. The management has opted for reduction of the fixed remuneration with dividends having been slashed by 50 per cent.
Arthur Sadoun, Chairman and CEO of Publicis Groupe: “There is no doubt that we are going through an unprecedented health crisis that will lead us to the greatest recession in living memory. It is too early to predict the full impact it will have on our clients and our business, so we will not provide any guidance. All of our countries, all of our activities will be impacted to varying degrees. So our response to this situation needs to be structured, multi-faceted and rigorously executed. Our experience in managing cost and cash in times of crisis, our country model and our strong balance sheet will help us to stand firm in this storm and prepare ourselves for recovery.”
To further protect its staff and clients, the company instituted work-at-home initiative and advanced the launch of its global AI platform Marcel, to keep the team across the world connected.
Arthur Sadoun: “We have worked around the clock to help our clients adapt to this situation. We reviewed their current and future commercial and corporate messages. We realigned their media plans to be much more dynamic, deliver short-term ROI and proposed some outcome-based products we have developed for this new market context. We are also helping them accelerate their digital capabilities to drive growth and efficiencies.”
During the review of the company’s performance, the lauded the Management Board and Supervisory Board lauded the decisions that had been put in place to insulate the company and expressed solidarity with the initiatives suggested by the management.
The Supervisory Board: “We were very impressed by the strong measures implemented by the Management Board to get through the crisis, by the exceptional mobilization of the teams around the world, the demonstration of solidarity and the spirit of collaboration at all levels, and wish to express our warmest thanks to everyone. We want to reiterate our full support to the Chairman of the Management Board and to the Group's management teams, who were able to make the right decisions very early on.”