Earnings: Publicis On Way To Digital Target, Though Online Profits Lag

(PaidContent.org)  This story was written by Robert Andrews.

---

Big-four communications group Publicis says it's on track to reach its 2010 target of pulling a quarter of revenue from digital, after seeing it comprise 18.8 percent of business in the first half of the year (up from 12.7 percent last year).

But online performance is not there yet, and that may be down to roll-out costs. "(Digital) profitability is improving, but is still below the group's average ... the average (online) margin is lower despite the fact that it is constantly improving."

Publicis has been going on an acquisition binge over the last year to bolster its acquisition of Digitas, which it is making its prime online arm. But in the quarter, Publicis also created VivaKi, an umbrella for Digitas and its Starcom MediaVest, Denuo and ZenithOptimedia units that lets clients more easily sell ads in to Google (NSDQ: GOOG), Yahoo (NSDQ: YHOO), Microsoft (NSDQ: MSFT), Platform-A (NYSE: TWX) and more.

Quarterly organic revenue grew 5.5 percent to 1.16 billion ($2.5 billion) despite a "somewhat depressed world economy, and against a backdrop of financial unease". The outlook for next half: "We will see a small slowdown which may be compensated in some areas of the business," CEO Maurice Levy told FT.com.

Release | Results | Slides | Webcast


By Robert Andrews