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SEC Filings

10-Q
INTERPUBLIC GROUP OF COMPANIES, INC. filed this Form 10-Q on 04/21/2017
Entire Document
 

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)
(Amounts in Millions, Except Per Share Amounts)
(Unaudited)


Net Interest Expense
For the three months ended March 31, 2017, net interest expense decreased by $1.1 as compared to the respective prior-year period, primarily due to lower non-cash interest expense from revaluations of mandatorily redeemable noncontrolling interests.
Other Income (Expense), Net
Results of operations for the three months ended March 31, 2017 and 2016 include certain items that are not directly associated with our revenue-producing operations.
 
Three months ended
March 31,
 
2017
 
2016
Gains (losses) on sales of businesses and investments
$
1.0

 
$
(16.3
)
Other expense, net
(0.2
)
 
(2.9
)
Total other income (expense), net
$
0.8

 
$
(19.2
)
Gains (Losses) on Sales of Businesses and Investments – During the three months ended March 31, 2016, the amounts recognized were related to sales of businesses and the classification of certain assets and liabilities, consisting primarily of accounts receivable and accounts payable, respectively, as held for sale within our Integrated Agency Networks ("IAN") operating segment.

INCOME TAXES
 
Three months ended
March 31,
 
2017
 
2016
Income (loss) before income taxes
$
14.8

 
$
(13.0
)
Benefit of income taxes
$
(2.1
)
 
$
(15.6
)
Our tax rates are affected by many factors, including our worldwide earnings from various countries, changes in legislation and tax characteristics of our income. For the three months ended March 31, 2017, our seasonally smallest quarter, our income tax benefit was driven by excess tax benefits on employee share-based payments, the majority of which is typically recognized in the first quarter due to the timing of the vesting of awards, partially offset by losses in certain foreign jurisdictions where we receive no tax benefit due to 100% valuation allowances.
For the three months ended March 31, 2016, our income tax benefit was positively impacted by the reversal of valuation allowances of $12.2 as a consequence of the classification of certain assets as held for sale in Continental Europe, excess tax benefits on employee share-based payments and the recognition of previously unrecognized tax benefits as a result of a lapse in statute of limitations. Our income tax benefit was negatively impacted primarily by losses in certain foreign jurisdictions where we receive no tax benefit due to 100% valuation allowances and by losses on sales of businesses, and the classification of certain assets as held for sale, for which we did not receive a full tax benefit.

EARNINGS PER SHARE
Basic and diluted earnings per share available to IPG common stockholders for the three months ended March 31, 2017 were $0.05 compared to $0.01 for the three months ended March 31, 2016.
For the three months ended March 31, 2016, net income available to IPG common stockholders included losses of $15.9, net of tax, on sales of businesses in our international markets and a benefit of $12.2 related to the reversals of valuation allowances as a consequence of the sales of businesses, resulting in impacts of ($0.04) and $0.03, respectively, to basic and diluted earnings per share.


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