Publicis results boosted by ‘resilient’ U.S., despite overall decline in 2020

A ‘resilient’ performance at Publicis Groupe’s U.S. arm helped boost its results for the final quarter of 2020, despite its overall growth for the full year having been impacted by the pandemic. In its full-year results, the holding company is reporting broadly flat net revenue, down 0.9% for 2020 at 9.71 billion euros ($11.68 billion) and organic growth down 6.3%. However, there is a marked contrast between its performance in the U.S., where organic growth showed a slight uptick in the final quarter, compared with Europe, where it continued to fall. U.S. organic growth increased by 0.5%, boosted by 5.5% growth at data company Epsilon. Publicis also said its digital media activities, health agencies and Publicis Sapient contributed to a ‘resilient’ U.S. performance overall in 2020, with organic growth down by 2% for the full year. In contrast, net revenue fell by 12.7% in Europe. Organic growth was down by 19.7% in France, which was particularly impacted by outdoor advertising during curfews and lockdowns, and by 12.4% in the U.K. Asia Pacific’s organic growth was down by 6.7%, Latin America’s down by 13.9% and the Middle East and Africa’s down by 11.7%. Despite these declines, Arthur Sadoun, chairman and CEO of Publicis Groupe, described the company’s overall performance in a statement as “solid.” He said the group had seen a continued new business momentum—with wins including Kraft Heinz, Reckitt Benckiser, Pfizer, Visa, L’Oréal in China, TikTok and Sephora—and emphasized that Publicis has not received any financial help, such as furlough, from the French state. And in a boost for employee morale, Publicis also said it would repay in full the salary cuts taken by 6,000 employees earlier in the pandemic, in a decision signed off by the board yesterday morning. 'Solid' performance In an interview with Ad Age, Sadoun said the U.S., which accounts for 60% of its business, had outperformed market expectations in the fourth quarter: "Nobody was expecting that we would deliver positive growth in the U.S," he said, adding that not only were its top 200 clients in the U.S. experiencing positive growth, the "more mature" market in the U.S. was buying into the Publicis business model. However, the impact of the pandemic in Europe versus the U.S. is also a factor. In terms of the outlook for 2021, Sadoun said there was a "direct correlation" between lockdowns and growth. Given the ongoing lockdowns in Europe, for example in the U.K. and France, "we need to be very careful in what we can expect from Europe." According to Sadoun, its employee platform, Marcel, has played a key role in helping allocating resources around the world: for example, matching employees to roles in other markets where there was a need for them to help out. For example, he says: "If you had a data analyst in an agency working on a media account that had cut their fees, they could begin working on a project for Epsilon the same day."

Publicis results boosted by ‘resilient’ U.S., despite overall decline in 2020

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