HAVAS: First Half 2006 Revenue
27 July 2006 - 7:13PM
PR Newswire (US)
SURESNES, France, July 27 /PRNewswire-FirstCall/ -- - First half
2006 revenue of EUR719 million, up 2.8% on first half 2005 -
Organic growth stable over the half-year: +2.5% in Q2 after -2.4%
in Q1 Havas today announced first half 2006 revenue of EUR719
million, compared with EUR 700 million in H1 2005. At constant
exchange rates, revenue growth would have been +0.5%. The exchange
rate impact was due mainly to a rise in the US and Canadian dollars
in the first quarter of 2006 by comparison with Q1 2005; Q2 2006
showed little variation on Q2 2005. Excluding exchange rate
variations and changes in scope of consolidation, organic growth in
the first half of 2006 was +0.2%. 1. General comments After a
slight downturn in Q1, at -2.4% on like for like exchange rates and
scope of consolidation, Q2 showed an improvement with organic
growth at +2.5%. Net new business[1] was EUR 900 million for the
first half, compared to EUR 490 million in H1 2005, and does not
include the recent win of the Reckitt Benckiser account announced
on June 30th, the impact of which will be reflected in third
quarter announcement. 2. Detailed comments by region The figures
between brackets indicate revenue in millions of euros and organic
growth over the first half of the year. - France (154, +2.6%)
Business recovered in Q2 (+6.1%) after a slight downturn in Q1
(-1.4%), thanks largely to corporate communication, marketing
services and media consulting. - Great Britain (84, -1.0%)
Corporate communication made a satisfactory Q2 performance, holding
business activity in the region steady (+0.5%) after a slight drop
in Q1 (-2.6%). - Europe (excluding France and Great Britain) (151,
+8.2%) All the group's main business activities enjoyed growth. By
country, the main contributors to Q2 growth were Spain, Italy and
Germany. - North America (274, -5.3%) Healthcare communication and
media consulting both generated significant growth in Q2. Corporate
communication also sustained a good level of growth. However, one
of our leading advertising agencies and some of the marketing
services firms are still having trouble matching their 2005
business levels. - Asia-Pacific (28, -4.8%) After a dip in Q1 due
to the loss of the Intel account still included in the Q1 basis of
comparison, Q2 2006 organic growth stabilized at -0.3%. - Latin
America (28, +16.5%) The two main business activities (advertising
and media consulting) continued to enjoy strong growth. 3. New
Business and creative quality Net New Business stood at EUR900
million for the first half of 2006. Lehmann Brothers ranked Havas
number one for New Business in June 2006. The main accounts won in
Q2 2006 are as follows: - Traditional advertising: Cogedim
(France), News Magazine (Great Britain), Granini (Spain), NTV
(Germany), Bongrain et Brendon Babystore (Hungary), Inci (Turkey),
Radio Mitre (Argentina), Telmex (Mexico), Hutchison Telecom
(Australia), TVB Pay Vision (Honk Kong) - Media: Veolia
Environnement (pan-European), Point S, Gerble and Umbro (France),
La Redoute and BAW International (Portugal), Viajar.com,
Ayuntamiento de La Coruna, Fagor, Mango, Osborne, Union Crediticia
Immobiliaria, Gennoma Lab and la Caixa (Spain), Hotel.com and
Garlik (Great Britain), Celebrity Cruises (USA), webmotors (Brazil)
and the Chivas Regal, Martell, Stolichnaya, Presidente and Don
Pedro brands owned by Pernod Ricard/Casa Pedro Domecq (Mexico) -
Marketing services: Sixt (pan-European), Marriott Hotels, Bausch
& Lomb and Concern Worldwide (Great Britain),Iveco (Spain) -
Corporate communication: Caisse d'Epargne Group (France) No
significant budgets were lost. In Q1 2006, a number of Group
agencies won an array of international and regional awards. At the
53rd Cannes International Advertising Festival, the Havas Group
carried off 19 Lions including three Gold Lions: one in the film
category for "La Marche de l'Empereur" (The March of the Emperor)
made by BETC Euro RSCG for Canal+, another in the cyber category to
Euro RSCG 4D Sao Paulo for its "Oops" campaign for Reckitt
Benckiser and the third to Havas Sports in the media category for
the design and organization of a one-day event on the Champs
Elysees entitled "Embracing the Olympic Spirit" in support of the
Paris 2012 Olympic bid. Other agencies awarded included Arnold
Boston, McKinney & Silver, EHS Brann, Euro RSGG 4D Amsterdam
and Euro RSCG Amsterdam, Euro RSCG Buenos Aires, Euro RSCG Vale and
Euro RSCG 4D in France. In addition, Euro RSCG Buenos Aires, Euro
RSCG 4D Sao Paulo, Euro RSCG Vale, Carillo Pastore Euro RSCG and
Euro RSCG in Colombia received nine awards at the Festival
Iberoamericano de la Publicidad. At the International Andy Awards,
Arnold Boston, McKinney & Silver, Euro RSCG Flagship and Euro
RSCG London all took awards for creativity. In Spain, MPG won the
Grand Prix at the Festival del Sol plus a Gold Prize for its media
campaign "Revolucion Sin Limites" for Nike. Euro RSCG 4D in Spain
won awards for its promotional marketing campaigns for Vodafone and
Spanair. For the very first time, a French interactive production
company (Streampower / MPG) received the prestigious Emmy award for
"Best interactive TV program of the year" for its co-production of
"CULT" alongside PPROD for TV channel France 5. BETC Euro RSCG once
again distinguished itself in recent months with the "Marche de
l'Empereur" campaign for Canal +. In France, the agency took the
top prize for an advertising campaign awarded by the Grand Prix des
Medias organized by CB News magazine, and the Strategies magazine
Grand Prix for advertising. In the USA, BETC Euro RSCG was honored
by the Clio Awards, the New York Art Directors Club and the AICP.
The "Fair Enough" campaign created for American Legacy by Arnold
Boston took a number of US awards at events including the
International Andy Awards, The One Show, the Clio Awards, the New
York Art Directors Club, the AICP and the Kelly Awards. The Delaney
Report Quarterly Awards also named Euro RSCG New York the best US
advertising agency in Q2 2006, while MPG in Spain was voted Media
Agency of the Year by Spanish advertising magazine Anuncios. The
Group's interim results will be published in mid-September.
APPENDIX 1 : REVENUE AND ORGANIC GROWTH 1st Quarter 2nd Quarter 1st
Half Revenue Organic Revenue Organic Revenue Organic growth growth
growth In Euro million France 70 -1.4% 84 +6.1% 154 +2.6% United
Kingdom 40 -2.6% 44 +0.5% 84 -1.0% Europe (excl. France and UK) 65
+5.8% 86 +10.0% 151 +8.2% North America 138 -6.7% 136 -3.9% 274
-5.3% Latin America 13 +19.1% 15 +14.5% 28 +16.5% Asia-Pacific 13
-9.5% 15 -0.3% 28 -4.8% TOTAL 339 -2.4% 380 +2.5% 719 +0.2%
APPENDIX 2 : ORGANIC GROWTH CALCULATION 1. Revenue H1 2005 700 2.
Foreign Exchange Impact +16 3. H1 2005 at H1 2006 FX 716 4. Changes
in scope of consolidation: acquisitions, disposals closures and
others 2 5. H1 2005 at H1 2006 FX and scope 718 6. Revenue H1 2006
719 7. Organic change +0,2% About Havas Havas (Euronext Paris:
HAV.PA; Nasdaq: HAVS) is a global advertising and communications
services group. Headquartered in Paris, Havas has three principal
operating divisions: Euro RSCG Worldwide which is headquartered in
New York, Arnold Worldwide Partners in Boston, and Media Planning
Group in Barcelona. A multicultural and decentralized Group, Havas
is present in 77 countries through its networks of agencies located
in 44 countries and contractual affiliations with agencies in 33
additional countries. The Group offers a broad range of
communications services, including traditional advertising, direct
marketing, media planning and buying, corporate communications,
sales promotion, design, human resources, sports marketing,
multimedia interactive communications and public relations. Havas
employs approximately 14,400 people. Further information about
Havas is available on the company's website: http://www.havas.com/
Forward-Looking Information This document contains certain
"forward-looking statements" within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements relate to expectations, beliefs, projections, future
plans and strategies, anticipated events or trends and similar
expressions, concerning matters that are not historical facts.
These forward-looking statements reflect Havas' current views about
future events and are subject to risks, uncertainties, assumptions
and changes in circumstances that may cause Havas' actual results
to differ significantly from those expressed in any forward-looking
statement. Certain factors that could cause actual results to
differ materially from expected results include changes in global
economic, business, competitive market and regulatory factors. For
more information regarding risk factors relevant to Havas, please
see Havas' filings with the U.S. Securities and Exchange
Commission. Havas does not intend, and disclaims any duty or
obligation, to update or revise any forward-looking statements
contained in this document to reflect new information, future
events or otherwise. (a) Net New Business : Net new business
represents the estimated annual advertising budgets for new
business wins (which includes new clients, clients retained after a
competitive review, and new product or brand expansions for
existing clients) less the estimated annual advertising budgets for
lost accounts. Havas' management uses net new business as a
measurement of the effectiveness of its client development and
retention efforts. Net new business is not an accurate predictor of
future revenues, since what constitutes new business or lost
business is subject to differing judgments, the amounts associated
with individual business wins and losses depend on estimated client
budgets, clients may not spend as much as they budget, the timing
of budgeted expenditures is uncertain, and the amount of budgeted
expenditures that translate into revenues depends on the nature of
the expenditures and the applicable fee structures. In addition,
Havas' guidelines for determining the amount of new business wins
and lost business may differ from those employed by other
companies. Contacts : Communications: Solenne Anthonioz Tel:
+33-(0)1-58-47-90-27 Investor Relations: Herve Philippe Chief
Financial Officer Tel: +33-(0)1-58-47-91-23 [1] Net business wins,
expressed in estimated annual billings. Full definition on page 6
of this release. DATASOURCE: Havas CONTACT: Contacts :
Communications: Solenne Anthonioz, Tel: +33-(0)1-58-47-90-27, ;
Investor Relations: Herve Philippe, Chief Financial Officer, Tel:
+33-(0)1-58-47-91-23,
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