Interpublic Group, the holding company of agencies including Lowe Worldwide and McCann Erickson has reported second quarter 2006 revenue of $1.53 billion, compared to $1.61 billion in the same period a year ago (a 4.8% drop), with first half revenue of $2.86 billion, compared to $2.94 billion during the first six months of 2005.
The company also saw an organic revenue decrease of 3.1% compared to the second quarter of 2005, with approximately 2.7% of the decrease due to the timing of revenue recognition.
During Q2, operating expenses decreased to $1.46 billion in 2006 from $1.50 billion last year. For the first half, operating expenses declined to $2.94 billion this year from $2.99 billion in 2005.
Operating income in the second quarter of 2006 was $76.9 million, compared to $115.5 million in 2005. For the first half of 2006, operating loss was ($82.9) million, compared to ($53.6) million in 2005.
“We’ve been clear that the bar on organic revenue would be high due to last year’s client losses. Organic performance for the first half demonstrates that we’ve been successful in replacing these lost revenues through six months, which is a significant accomplishment that positions us well going forward.
“During the second quarter, we also saw the first indications of stepped-down professional fees, in line with our previous disclosure. A major focus for the balance of this year will be on managing costs and delivering margin improvement.”
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