-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ei7awQ1nnnXTSCPyX7vdn2wgST2vix0Y9Ks6HyaEdVXIzqTX3E+KYkT0yKvFSHri bgChZNarxfFemvssKuAKmg== 0000891092-03-000847.txt : 20030429 0000891092-03-000847.hdr.sgml : 20030429 20030429081600 ACCESSION NUMBER: 0000891092-03-000847 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 20030429 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030429 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OMNICOM GROUP INC CENTRAL INDEX KEY: 0000029989 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-ADVERTISING AGENCIES [7311] IRS NUMBER: 131514814 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10551 FILM NUMBER: 03667785 BUSINESS ADDRESS: STREET 1: 437 MADISON AVE CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2124153700 MAIL ADDRESS: STREET 1: 437 MADISON AVE CITY: NEW YORK STATE: NY ZIP: 10022 FORMER COMPANY: FORMER CONFORMED NAME: DOYLE DANE BERNBACH INC DATE OF NAME CHANGE: 19781226 FORMER COMPANY: FORMER CONFORMED NAME: DOYLE DANE BERNBACH INTERNATIONAL INC DATE OF NAME CHANGE: 19850604 FORMER COMPANY: FORMER CONFORMED NAME: DOYLE DANE BERNBACH GROUP INC DATE OF NAME CHANGE: 19861117 8-K 1 e14710_8k.htm FORM 8-K 8-K

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 29, 2003

OMNICOM GROUP INC.
(Exact Name of Registrant as Specified in its Charter)

New York
(State or Other Jurisdiction of Incorporation)

1-10551
(Commission File Number)
13-1514814
(I.R.S. Employer Identification No.)

437 Madison Avenue, New York, New York 10022
(Address of Principal Executive Offices) (Zip Code)

(212) 415-3600
(Registrant’s Telephone Number, Including Area Code)

       

Item 7. Financial Statements and Exhibits.

(c) Exhibits.

     99.1   Earnings release dated April 29, 2003.

     99.2   Investor presentation materials dated April 29, 2003.

Item 9. Regulation FD Disclosure.

     In accordance with the interim guidance set forth in Release Nos. 33-8216 and 34-47583 issued by the Securities and Exchange Commission on March 27, 2003, the following information (including the exhibits hereto) which is intended to be furnished under “Item 12. Results of Operations and Financial Condition,” is being furnished under “Item 9. Regulation FD Disclosure.” Such information (including the exhibits hereto) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

     On April 29, 2003, Omnicom issued an earnings release reporting its financial results for the fiscal quarter ended March 31, 2003. A copy of this earnings release is attached as Exhibit 99.1 hereto. Following the issuance of this earnings release, Omnicom hosted an earnings call in which its financial results for the fiscal quarter ended March 31, 2003 were discussed. The investor presentation materials used for the call are attached as Exhibit 99.2 hereto.

     On April 29, 2003, Omnicom posted the materials attached as Exhibits 99.1 and 99.2 on its web site (www.omnicomgroup.com).

     As discussed on page 1 of Exhibit 99.2, the investor presentation contains forward-looking statements within the meaning of the federal securities laws. These statements are present expectations, and are subject to the limitations listed therein and in Omnicom’s other SEC reports, including that actual events or results may differ materially from those in the forward-looking statements.

     The filing of this Report and the furnishing of this information pursuant to Items 9 and 12 (including the investor presentation) do not mean that such information is material or that disclosure of such information is required.

 
   

 


 

SIGNATURES

     Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

  OMNICOM GROUP INC.
     
  By:  /s/ Philip J. Angelastro
Philip J. Angelastro
Senior Vice President Finance and Controller

Date: April 29, 2003

 
   

 


  EX-99.1 3 e14710ex99_1.htm PRESS RELEASE 99.1

Exhibit 99.1

Contact: Randall Weisenburger
212-415-3393

FOR IMMEDIATE RELEASE

NEW YORK, APRIL 29, 2003 - Omnicom Group Inc. (NYSE-OMC) today announced that net income for the first quarter of 2003 increased marginally to $128.6 million compared with the first quarter of 2002 and diluted earnings per share for the first quarter of 2003 increased to $0.69 per share from $0.68 per share in the first quarter of 2002.

Worldwide revenue increased 12% to $1,937.2 million from $1,732.4 million in the first quarter of 2002. Domestic revenue for the first quarter of 2003 increased 8% to $1,099.6 million compared to $1,022.1 million in 2002. International revenue increased 18% to $837.6 million compared to $710.3 million last year.

Omnicom Group Inc. (NYSE-OMC) (www.omnicomgroup.com), is a leading global marketing and corporate communications company. Omnicom’s branded networks and numerous specialty firms provide advertising, strategic media planning and buying, direct and promotional marketing, public relations and other specialty communications services to over 5,000 clients in more than 100 countries.

For a live webcast and/or a replay of our first quarter earnings conference call, go to www.omnicomgroup.com/InvestorRelations.

 
   

 


 

Omnicom Group Inc.

(Unaudited)
(In Thousands of Dollars, Except Per Share Data)

Three Months Ended March 31
  2003
  2002
 
           
Revenue $ 1,937,245 $ 1,732,426
           
Operating and net interest expense 1,722,159 1,514,890
           
Income before income taxes 215,086 217,536
           
Income taxes 75,211 79,858
           
Income after income taxes 139,875 137,678
           
Equity in affiliates / Minority interests (11,291 ) (9,112 )
   
 
 
Net income $    128,584 $    128,566
   
 
 
Earnings per share
           
         Basic $          0.69 $          0.69
         Diluted $          0.69 $          0.68
   
Weighted average shares (in thousands)
           
         Basic 186,556 186,671
         Diluted (a) 187,329 189,490
           
Dividend declared per share $          0.20 $          0.20

(a) Diluted earnings per share for 2003 and 2002 was calculated using an assumed increase in net income of $240,000 and $271,000 respectively, related to the after-tax compensation expense from dividends on restricted shares.

 
   

 


  EX-99.2 4 e14710ex99_2.htm ex99.1
Exhibit 99.2


OmnicomGroup

FIRST QUARTER 2003 RESULTS
Investor Presentation

April 29, 2003

 


 

The following materials have been prepared for use in the April 29, 2003 conference call on Omnicom’s results of operations for the quarter ended March 31, 2003. The call will be archived on the Internet at http://www.omnicomgroup.com/financialwebcasts.

Forward-Looking Statements
Certain of the statements in this document constitute forward-looking statements. These statements relate to future events or future financial performance and involve known and unknown risks and other factors that may cause our actual or our industry’s results, levels of activity or achievement to be materially different from those expressed or implied by any forward-looking statements. These risks and uncertainties include, but are not limited to, our future financial condition and results of operations, changes in general economic conditions, competitive factors, changes in client communication requirements, the hiring and retention of human resources and our international operations, which are subject to the risks of currency fluctuations and exchange controls. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” or “continue” or the negative of those terms or other comparable terminology. These statements are present expectations. Actual events or results may differ materially.

Other Information

All dollar amounts are in millions except for EPS. The following financial information contained in this document has not been audited, although some of it has been derived from Omnicom’s historical financial statements, including its audited financial statements. In addition, industry, operational and other non-financial data contained in this document has been derived from sources we believe to be reliable, but we have not independently verified such information, and we do not, nor does any other person, assume responsibility for the accuracy or completeness of that information.

The inclusion of information in this presentation does not mean that such information is material or that disclosure of such information is required.

OmnicomGroup  1

2003 vs. 2002 P&L Summary
 
  First Quarter
  2003
2002
% Change
Revenue $1,937.2    $1,732.4    11.8 %
             
Operating Income 223.4   228.8   (2.4) %
% Margin 11.5%   13.2%      
             
Net Interest Expense 8.3   11.3    
 
 
     
Profit Before Tax 215.1   217.5   (1.1) %
% Margin 11.1%   12.6%    
             
Taxes 75.2   79.8    
% Tax Rate 35.0%   36.7%    
 
 
     
Profit After Tax 139.9   137.7   1.6 %
             
Equity in Affiliates/
Min. Interest
(11.3)   (9.1)    
 
 
     
Net Income $   128.6   $   128.6  
 
 
     

OmnicomGroup  2

2003 vs. 2002 Earnings Per Share
 

First Quarter


2003


 

2002


Earnings per Share:

 

Basic

$  0.69

 

$ 0.69

Diluted

0.69

 

0.68

       

Weighted Average Shares (millions):

 

Basic

186.6

 

186.7

Diluted

187.3

 

189.5

       

Dividend Declared Per Share

$0.20

 

$0.20

OmnicomGroup  3

2003 Total Revenue Growth
 
 

First Quarter 2003


 

$


%


Prior Period Revenue

$1,732.4

 

Foreign Exchange (fx) Impact(a)

107.3

6.2%

 

Acquisition Revenue(b)

52.7

3.0%

 

Organic Revenue(c)

44.8

2.6%

 
 

 

Current Period Revenue

$1,937.2

11.8%

 
 

 

(a)   To calculate the FX impact, we first convert the current period’s local currency revenue using the average exchange rates from the equivalent prior period to arrive at constant currency revenue. The FX impact equals the difference between the current period revenue in U.S. dollars and the current period revenue in constant currency.
(b)   Acquisition revenue is the aggregate of the applicable prior period revenue of the acquired businesses. Netted against this number is the revenue of any business included in the prior period reported revenue that was disposed of subsequent to the prior period.
(c)   Organic revenue is calculated by subtracting both the acquisition revenue and the FX impact from total revenue growth.

OmnicomGroup  4

2003 Revenue By Discipline
 



  Revenue By Discipline — First Quarter 2003
 

$ Mix


Growth


Advertising

859.7

 

10.5%

 

CRM

631.3

 

20.8%

 

PR

225.0

 

-1.1%

 

Specialty

221.2

  8.2%

 


Note: “Growth” is the year-over-year growth from the prior period.

OmnicomGroup 5 

2003 Revenue By Geography
 



Domestic vs. International — First Quarter 2003

$ Mix


$ Growth


United States

$1,099.6

$   77.4

Organic

 

44.0

 

Acquisition

 

33.4

 

International

$   837.6

$ 127.4

 

Organic

 

0.8

 

Acquisition

 

19.3

 

FX

 

107.3

 

 

Primary Markets — First Quarter 2003
 

$ Mix


Growth


United States

$1,099.6

 

7.6%

 

Euro Markets

388.1

 

21.3%

 

United Kingdom

210.9

 

15.3%

 

Other

238.6

 

15.0%

 

OmnicomGroup  6


Current Credit Picture
 
      Q1 End
     

2003


 

2002


 

Operating Income (EBIT) (a)

$1,099    $1,078   

Net Interest Expense (a)

$27.5   $63.8  

EBIT / Net Interest

40.0 x 16.9 x

Total Debt / EBIT

2.3 x 2.7 x
 

Debt:

       
   

Bank Loans (Due Less Than 1 Year)

$      96   $    205  
   

$835 Million Revolver Due 11/14/05

100   300  
   

CP issued under 364 Day Facility (b)

350   404  
   

5.20% Euro Notes Due 6/24/05 (c)

166   133  
   

$850 Million Convertible Notes Due 2/7/31

847   850  
   

$900 Million Convertible Notes Due 7/31/32

900   900  
   

Loan Notes and Sundry (various through 2012)

23   100  
 
 
 

Total Debt

$2,482   $2,892  
 
 
 
  Cash and Short Term Investments 381   550  
 
 
 

Net Debt

$2,101
  $2,342
 
         


(a) “Operating Income (EBIT)” and “Net Interest Expense” calculations shown are latest twelve month figures for the quarter ended as specified. Although our bank agreements reference EBITDA, we have used EBIT for this presentation because EBITDA is a non-GAAP measure. Latest twelve month figures for 2002 are adjusted to assume that the cessation of goodwill amortization occured as of the beginning of the period.
(b) The underlying $1.025 billion 364 Day Credit facility expires 11/14/03 plus one-year term out at Omnicom’s option.
(c) The change in the outstanding balance is the result of changes in the Euro to US dollar currency exchange rate.

OmnicomGroup  7

Current Liquidity Picture
 
  Omnicom has ample liquidity to meet all foreseeable business and capital requirements.

       

As of March 31, 2003


     

Total Amount
of Facility


Outstanding


Available


Committed Facilities

 
 

364 Day Revolving Credit Facility

$1,025

$ 350

$   675

 
 

3 Year Revolving Credit Facility

835

100

735

 
 

Other Committed Credit Facilities

33

33

 

Total Committed Facilities

1,893

483

1,410

 

Uncommitted Facilities(a)

411

63

0

(a)

Total Credit Facilities

$2,304

$ 546

$1,410

 
   

Cash

355

 
    Short Term Investments

26

 
   

Total Liquidity Available

$1,791

 

(a)   Uncommitted facilities in the U.S., U.K. and Canada. These amounts are excluded for purposes of this analysis.

OmnicomGroup  8

Traditional Return on Equity(a)
 


Note:   Prior year amounts not adjusted here to reflect acquisitions accounted for as poolings of interest. 1994 excludes a $28.0 million after-tax charge for the cumulative effect of an accounting change related to postemployment benefits. 2000 excludes a $63.8 million after-tax gain from the sale of Razorfish shares.
(a)   “Traditional Return on Equity” is Net Income for the given period divided by the shareholders’ equity at the end of the prior period.
(b)   LTM result is calculated as the Net Income for the previous twelve months ended 3/31/03 divided by the shareholders’ equity on 3/31/02.

OmnicomGroup  9

Return on Net Incremental Equity
 
 

1991


1991-LTM Q1’03
changes


LTM Q1’03
 

Net Income (SFAS 142)(a)

$ 69.5

     

$ 643.5

   
               
     Incremental Annual Net Income    

$ 574.0

       
     Incremental Equity Capital:              
          Equity Issuances(b)    

$2,623.9

      2.3x
          Less: Dividends    

(907.5

)      
          Less: Share Repurchases    

(1,461.3

)      
     Net Incremental Equity Capital:    

$ 255.1

       
               

(a) Prior period results adjusted to reflect SFAS 142 (elimination of goodwill amortization) as if it had always been in effect.
(b)   Includes issuances of equity including shares for acquisitions, employee benefit plans and in exchange for convertible securities.

OmnicomGroup  10

 


Acquisitions Summary

 


 
   

Acquisition Related Expenditures
 

First Quarter 2003


New Subsidiary Acquisitions (a)

$   1.3

 

Affiliates to Subsidiaries (b)

-

 

Affiliates (c)

1.6

 

Existing Subsidiaries (d)

13.7

 

Earn-outs (e)

4.3

 

Total Acquisition Expenditures

$ 20.9

 

Note:   See appendix for subsidiary acquisition profiles.
(a)   Includes acquisitions of a majority interest in new agencies resulting in their consolidation.
(b)   Includes acquisitions of additional equity interests in existing affiliate agencies resulting in their majority ownership and consolidation.
(c)   Includes acquisitions of less than a majority interest in agencies in which Omnicom did not have a prior equity interest and the acquisition of additional interests in existing affiliated agencies that did not result in majority ownership.
(d) Includes the acquisition of additional equity interests in already consolidated subsidiary agencies.
(e)   Includes additional consideration paid for acquisitions completed in prior periods.

OmnicomGroup Acquisitions  12

Potential Earn-out Obligations
 
   The following is an estimate of future earn-out related obligations as of March 31, 2003, assuming that the underlying acquired agencies continue to perform at their current levels:(a)

2003(b)


2004


2005


2006


Thereafter


Total


$ 231.5

$ 129.2

$  82.6

$ 28.7

$ 18.2

$490.2


(a) The ultimate payments will vary as they are dependent on future events.
(b) Estimated remaining obligations as of March 31, 2003.

OmnicomGroup Acquisitions  13

Potential Put Obligations
 
   In conjunction with certain transactions Omnicom has agreed to acquire (at the sellers’ option) additional equity interests. The following is an estimate of these potential future “put” obligations (as of March 31, 2003), assuming these underlying acquired agencies continue to perform at their current levels:

Currently
Exercisable


Not Currently
Exercisable


Total

Subsidiary Agencies

$111.6

$102.8

$214.4

Affiliated Agencies

12.9

14.9

27.8

 


        Total

$124.5

$117.7

$242.2

OmnicomGroup Acquisitions  14

 

Acquisitions Quarter-to-Date
 

The following pages are summaries of 2003
acquisitions completed during the quarter ended
March 31, 2003

 
OmnicomGroup Acquisitions  16



Creative Juice

Creative Juice is a fast-growing award-winning advertising agency based in Bangkok, Thailand. Since its inception four years ago, the agency has built a strong reputation and has secured the accounts of several high profile Thai advertisers. Creative Juice will become part of the TBWA/Thailand group.

 
OmnicomGroup Acquisitions  16



Grothgar Manchot & Partner

GM&P is a traditional media advertising agency located in Dusseldorf, Germany focused on serving the specialized needs of clients in the personal products sector. GM&P will be merged with DDB Dusseldorf where it will compliment DDB’s relationship with several of its core multinational clients by further enhancing their capabilities in the personal products category in Germany.

 
OmnicomGroup Acquisitions  17
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