Four Things to Expect From Maurice Levy's Last Earnings Call on Thursday

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Maurice Levy
Maurice Levy Credit: Fabrice Dimier/Bloomberg

After 30 years as chairman and CEO of Publicis Groupe, Maurice Lévy will announce his last set of earnings on Thursday at the French holding company's presentation of first-quarter 2017 results in Paris. Here's what to expect:

1. It's Lévy's swan song, and it may be a long one. The voluble Frenchman, who hands over to successor Arthur Sadoun at the annual general meeting in Paris on May 31, is well-known for his lengthy exchanges with analysts. Earnings calls routinely go on for a couple of hours.

2. Don't expect great numbers. With fairly weak results predicted, he may not be going out on a business high. At least the numbers won't come as a surprise: Lévy warned in February that the first quarter of this year would not offer much improvement on the fourth quarter of 2016, when revenues were down 2.5%.

"This [weakness] is incorporated into expectations already," said Brian Weiser, an analyst at Pivotal, said in an email. "I think [Lévy] will talk about new business trends, which have been pretty decent for them … and integration efforts between Sapient [the digital and tech network Publicis Groupe bought in February 2015] and different parts of the rest of the business."

3. But do expect some showmanship. Whatever the results, Lévy will no doubt deliver them with the style and panache he is known for.

"Maurice's genius is in managing stock market expectations, and telling the story in a way that has kept the share price in an amazing place," said Richard Pinder, CEO U.K. and international at CP&B – and former chief operating officer of the Publicis Worldwide networkyes.

Until June 1, Sadoun is CEO of the group's Publicis Communications division, which houses creative agency networks including Leo Burnett, Saatchi & Saatchi, and Bartle Bogle Hegarty. "The biggest test for Arthur will not be running the business – he will do what needs to be done – but managing the stock price," said Pinder. "It's an acquired art that very few new CEOs are any good at, and Arthur won't have a following wind to help him."

4. It won't be all gloom and doom. A note from Greg Paull, co-founder and principal at the ad agency consulting firm R3, is more positive about Publicis Groupe's prospects for the first quarter results tomorrow. He rates it a "hold" alongside its main competitors, Omnicom, Interpublic and WPP. "Investors have been overly negative on Publicis given the 2015-16 account losses they are still reeling from, while overlooking its media agencies' improved positioning and the long-term benefits that should follow from ownership of the legacy Sapient business," he said.

Publicis Groupe is still recovering from a difficult period in 2015 and 2016, when it lost significant media business from Procter & Gamble, Coca-Cola and Walmart. Lévy has since worked to shore up its media offering, particularly by elevating Steve King, CEO of all Publicis' media operations globally since the start of 2016, to the management board in January 2017.

Although Lévy warned in February that geopolitical uncertainty would hold back growth this year, he did suggest that the numbers would be stronger in the second half, which could help Sadoun to hit his stride.

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