NEW YORK (AdAge.com) -- Interpublic Group of Cos.' stock plummeted today after it postponed its earnings report.
Interpublic closed at $14.99, down 23.8%, after it announced in mid-afternoon it would move the earnings report initially scheduled for Aug. 6 to Aug. 13. Interpublic today hit a low of $13.26, down 32.6% from Aug. 2's close and the lowest price for the stock since October 1995. The stock now trades at less than half its April price.
In a statement, the company said the move was meant to give the audit committee of the board of directors more time to complete its review of the results before top management certifies them. Under a new federal regulation, CEOs and chief financial officers must now sign off their companies' quarterly statements to verify the results are accurate.
Interpublic management had been on track to release its results Aug. 6, anticipating that the audit committee would sign off on results at a regular committee meeting today. But the committee then delayed its meeting till Aug. 12 to give members more time to review the financials. Interpublic now intends to release its financials Aug. 13, one day ahead of the deadline to file its 10-Q quarterly report with the Securities and Exchange Commission.
Interpublic's stock had been dropping during the day after CIBC World Markets initiated coverage of the stock with a "hold" recommendation; CIBC initiated coverage of Omnicom Group and DoubleClick with "buy" ratings.
Bracing for bad earnings report
An Advertising Age story today said investors were bracing for a bad earnings report from Interpublic; some analysts expect organic revenue to fall about 10%.
Omnicom, which reports earnings Aug. 6, saw its stock fall 7% to close at $47.21. WPP Group also fell 7% to $32.09.
Interpublic's audit committee has five members: Committee Chairman Frank J. Borelli, a former chief financial officer of Marsh & McLennan Cos.; Reginald K. Brack, former chairman-CEO of Time Inc.; Jill M. Considine, chairman-CEO of Depository Trust & Clearing Corp.; Michael I. Roth, chairman-CEO of MONY Group; and a recent addition, Richard A. Goldstein, chairman-CEO of International Flavors & Fragrances.
PricewaterhouseCoopers has been Interpublic's auditor since 1952.