IPG
    Print Page  Close Window

SEC Filings

10-Q
INTERPUBLIC GROUP OF COMPANIES, INC. filed this Form 10-Q on 10/26/2017
Entire Document
 

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


 
 
 
Components of Change
 
 
 
Change
 
Three months ended
September 30, 2016
Foreign
Currency
 
Net
Acquisitions/
(Divestitures)
 
Organic
 
Three months ended
September 30, 2017
Organic
 
Total
Consolidated
$
1,922.2

 
$
7.7

 
$
(37.2
)
 
$
9.9

 
$
1,902.6

 
0.5
 %
 
(1.0
)%
Domestic
1,165.9

 
0.0

 
(25.0
)
 
15.1

 
1,156.0

 
1.3
 %
 
(0.8
)%
International
756.3

 
7.7

 
(12.2
)
 
(5.2
)
 
746.6

 
(0.7
)%
 
(1.3
)%
United Kingdom
174.0

 
(4.3
)
 
1.4

 
5.3

 
176.4

 
3.0
 %
 
1.4
 %
Continental Europe
147.6

 
6.4

 
(4.0
)
 
0.6

 
150.6

 
0.4
 %
 
2.0
 %
Asia Pacific
217.9

 
0.8

 
(0.2
)
 
(4.6
)
 
213.9

 
(2.1
)%
 
(1.8
)%
Latin America
103.6

 
2.4

 
(10.4
)
 
(10.3
)
 
85.3

 
(9.9
)%
 
(17.7
)%
Other
113.2

 
2.4

 
1.0

 
3.8

 
120.4

 
3.4
 %
 
6.4
 %
During the third quarter of 2017, our revenue decreased by $19.6, or 1.0%, compared to the third quarter of 2016, comprised of an organic revenue increase of $9.9, or 0.5% and a favorable foreign currency rate impact of $7.7, offset by the effect of net divestitures of $37.2. Our organic revenue increase was primarily attributable to growth within the healthcare sector, offset by decreases in the technology and telecom sector. The organic revenue increase in our domestic market was mainly driven by our media and advertising businesses, partially offset by declines within our digital specialist agencies and a decrease in pass-through revenue related to certain projects where we acted as principal that decreased in size or did not recur in our events businesses during the third quarter of 2017, the impact of which is also reflected as a comparable reduction in office and general expenses. In our international markets, the organic revenue decrease was primarily attributable to decreases at our advertising businesses in Latin America, most notably in Brazil, and the Asia Pacific region, partially offset by growth across all regions at our media businesses as well as growth at our advertising businesses in the United Kingdom.
 
 
 
Components of Change
 
 
 
Change
 
Nine months ended
September 30, 2016
Foreign
Currency
 
Net
Acquisitions/
(Divestitures)
 
Organic
 
Nine months ended
September 30, 2017
Organic
 
Total
Consolidated
$
5,582.1

 
$
(30.7
)
 
$
(73.8
)
 
$
63.8

 
$
5,541.4

 
1.1
 %
 
(0.7
)%
Domestic
3,426.2

 
0.0

 
(52.5
)
 
54.6

 
3,428.3

 
1.6
 %
 
0.1
 %
International
2,155.9

 
(30.7
)
 
(21.3
)
 
9.2

 
2,113.1

 
0.4
 %
 
(2.0
)%
United Kingdom
495.3

 
(44.5
)
 
12.5

 
8.5

 
471.8

 
1.7
 %
 
(4.7
)%
Continental Europe
468.1

 
(3.9
)
 
(13.3
)
 
6.1

 
457.0

 
1.3
 %
 
(2.4
)%
Asia Pacific
617.7

 
(0.7
)
 
2.4

 
(12.0
)
 
607.4

 
(1.9
)%
 
(1.7
)%
Latin America
255.7

 
14.3

 
(24.6
)
 
(7.9
)
 
237.5

 
(3.1
)%
 
(7.1
)%
Other
319.1

 
4.1

 
1.7

 
14.5

 
339.4

 
4.5
 %
 
6.4
 %
During the first nine months of 2017, our revenue decreased by $40.7, or 0.7%, compared to the first nine months of 2016, comprised of an organic revenue increase of $63.8, or 1.1%, offset by the effect of net divestitures of $73.8 and an adverse foreign currency rate impact of $30.7. Our organic revenue increase was primarily attributable to growth within the healthcare sector, offset by decreases in the technology and telecom sector. The organic increase in our domestic market was mainly driven by our media and advertising businesses, offset by weakness in our events and branding businesses. In our international markets, the organic revenue increase was primarily driven by growth across all regions at our media businesses and our advertising businesses in the United Kingdom, partially offset by decreases at our advertising businesses in the Asia Pacific and Latin America regions and our events businesses in the United Kingdom, primarily as a result of certain projects where we no longer act as principal.
Refer to the segment discussion later in this MD&A for information on changes in revenue by segment.

22