Following back-to-back first-quarter earnings calls this morning by MDC Partners and The Stagwell Group, MDC became only the second publicly traded agency holding company, after Omnicom Group, not to report positive worldwide organic growth in the first quarter of 2021.

MDC reported net revenue of $270.7 million, a decline of 1.4% from a year ago, and an organic net revenue decline of 2.1%. The company also posted an organic revenue decline of 6.9%, which continues “to narrow the year-over-year revenue decline amidst the pandemic recovery,” according to a statement by MDC.

While MDC has published selected information about net revenue in the past, it expanded its net revenue information this quarter, a person close to the company told Ad Age. MDC's net revenue excludes billable expenses charged to a client.

Mark Penn, CEO of MDC Partners (and president and managing partner of Stagwell), also reiterated  his point from a few months ago that the holding company is on track to deliver 7-9% organic revenue growth for the year.

Stagwell posted net revenue of $158.1 million, an increase of 4.8%, with an organic decline of 1.3% after factoring out acquisitions. Stagwell's net revenue excludes third-party direct costs. Stagwell reported a 6.9% organic revenue decline for revenue including third-party direct costs. Stagwell attributed the decline “almost entirely” to a decline in its digital content segment that includes its global travel marketing brand, Ink, according to a statement by Stagwell.

Given Stagwell's political business and the fact that 2021 is a non-election year, Stagwell also offered financial performance adjusting for acquisitions and the election cycle, incorporating a comparison of results for its Communications, Public Affairs, and Advocacy segment in first-quarter 2021 vs. first-quarter 2019, a political off-cycle year. On that basis, Stagwell reported 5.4% net revenue growth.

The two companies, which announced they agreed on terms for a merger in December, are also nearly one step closer to the deal’s completion.

“As you have seen, we filed several amendments to our S-4 (proxy statement/prospectus) as we’ve been working through the comment period with the SEC,” Irwin Simon, lead independent director for MDC’s board of directors, said during the earnings call. "We are hopeful that we are close to the end of that process and will be able to file our [official] proxy statement/prospectus in the coming days. I know it's taken a little time to get there, but patience is often rewarded and we're confident that this will be the case.”

A proxy statement/prospectus is the filing that MDC shareholders will receive in preparation for a shareholder vote. In late April MDC filed a preliminary proxy statement/prospectus that mentioned shareholders would vote virtually on June 22, which is still the expected date; the  deal is anticipated to close on or around June 30, shortly after completing necessary transaction steps, a spokeswoman confirmed.

Penn expressed his confidence of the merger further increasing the company’s competitiveness against the larger holding companies in the industry.

“There are four big players who get $60 billion, that haven't been challenged at scale for decades,” he said. “As we build this combination and expand out into the global marketplace so that we compete on technology, creativity and have full global coverage, we'll be able to reach up and win those larger contracts away from those companies.”

MDC’s stock jumped following MDC’s earnings announcement, reaching a multi-year high of $5. Shares closed today at $4.92, up 8.9%, showing shareholder confidence in the deal being completed.