-----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, S06XgjH2MGIyc13G2cFKl8EoftkJ6isOMAjCj9tYkQsqn+O9y496UPSPRE4xw4um AjvZzTOmhE73iLuaEeearQ== 0000891092-04-003506.txt : 20040728 0000891092-04-003506.hdr.sgml : 20040728 20040727073120 ACCESSION NUMBER: 0000891092-04-003506 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 9 CONFORMED PERIOD OF REPORT: 20040427 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20040727 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: 04932122 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 GROUP INC DATE OF NAME CHANGE: 19861117 FORMER COMPANY: FORMER CONFORMED NAME: DOYLE DANE BERNBACH INTERNATIONAL INC DATE OF NAME CHANGE: 19850604 FORMER COMPANY: FORMER CONFORMED NAME: DOYLE DANE BERNBACH INC DATE OF NAME CHANGE: 19781226 8-K 1 e18534_8k.htm FORM 8-K form 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): July 27, 2004

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 July 27, 2004.
  99.2 Investor presentation materials dated July 27, 2004.

Item 9. Regulation FD Disclosure.

     See “Item 12. Results of Operations and Financial Condition” below.

Item 12. Results of Operations and Financial Condition.

     On July 27, 2004, Omnicom Group Inc. (“Omnicom”) issued an earnings release reporting its financial results for the three and six months ended June 30, 2004. 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 three and six months ended June 30, 2004 were discussed. The investor presentation materials used for the call are attached as Exhibit 99.2 hereto.

     On July 27, 2004, 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 investor presentation includes information on traditional return on equity, which for the amounts shown for 2000 excludes a non-recurring gain. As a result of this exclusion, this presentation is a non-GAAP financial measure as defined under applicable SEC rules and regulations. The investor presentation includes explanations of why management believes the presentations of the non-GAAP financial measures are useful to investors, as well as a reconciliation of the non-GAAP financial measures to the closest GAAP financial measures.

     The foregoing information (including the exhibits hereto) is being furnished under “Item 9. Regulation FD Disclosure” and “Item 12. Results of Operations and Financial Condition.” 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, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

     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.

 
  2 

 


 

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: July 27, 2004

 
  3 

 


 

EXHIBIT INDEX

   Exhibit
Number

Description of Documents
  99.1 Earnings Release dated July 27, 2004.
     
  99.2 Investor presentation materials dated July 27, 2004.

   

 


  EX-99.1 2 e18534ex99_1.htm PRESS RELEASE

Exhibit 99.1

Contact:     Randall Weisenburger
212-415-3393

FOR IMMEDIATE RELEASE

NEW YORK, July 27, 2004 - Omnicom Group Inc. (NYSE-OMC) today announced that net income for the second quarter of 2004 increased 15% to $206.1 million from $180.0 million in the second quarter of 2003. Diluted earnings per share in the second quarter of 2004 increased 15% to $1.10 per share from $0.96 per share in the second quarter of 2003.

Worldwide revenue increased 12% to $2,407.8 million from $2,149.5 million in the second quarter of 2003. Domestic revenue for the second quarter of 2004 increased 11% to $1,312.2 million compared to $1,182.2 million in 2003. International revenue increased 13% to $1,095.6 million compared to $967.3 million last year.

Net income for the six months ended June 30, 2004 increased 16% to $341.7 million from $295.6 million in 2003. Diluted earnings per share increased 15% to $1.81 per share in 2004 from $1.58 per share in 2003.

Worldwide revenue for the six months ended June 30, 2004 increased 14% to $4,639.2 million from $4,086.8 million in 2003. Domestic revenue for the six months ended June 30, 2004 increased 11% to $2,533.4 million compared to $2,281.8 million in 2003. International revenue for the six months ended June 30, 2004 increased 17% to $2,105.8 million compared to $1,805.0 million in 2003.

In accordance with SFAS No. 123, “Accounting for Stock Based Compensation”, as amended by SFAS 148, “Accounting for Stock-Based Compensation - Transition and Disclosure, an amendment for FASB Statement No. 123”, we elected, effective January 1, 2004, to account for stock-based employee compensation using the fair value method. As a result, the fair value of stock-based employee compensation, including unvested employee stock options issued and outstanding, were recorded as an expense utilizing the retroactive restatement method as set forth in SFAS 148. Accordingly, our results for the quarter and six months ended June 30, 2003 have been restated as if we used the fair value method to account for stock-based compensation.


Omnicom Group Inc.

Omnicom Group Inc. (NYSE-OMC) (www.omnicomgroup.com) is a leading global advertising, 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 Millions of Dollars, Except Per Share Data)

Three Months Ended June 30 2004 2003 (a)
           
Revenue   $    2,407.8   $    2,149.5  
           
Operating expenses   2,064.1   1,830.2  


Operating income   343.7   319.3  
           
Net interest expense   7.3   12.9  


Income before income taxes   336.4   306.4  
           
Income taxes   113.1   104.0  


Income after income taxes   223.3   202.4  
           
Equity in affiliates   4.9   1.9  
Minority interests   (22.1 ) (24.3 )


Net income   $        206.1   $        180.0  


Earnings per share  
         Basic   $          1.10   $          0.96  
         Diluted   $          1.10   $          0.96  
   
Weighted average shares (in millions)  
         Basic   186.8   187.2  
         Diluted (b)   188.2   187.2  
           
Dividend declared per share   $        0.225   $        0.200  


(a) In accordance with the adoption of SFAS No. 123, as amended by SFAS 148, on January 1, 2004 we restated our quarterly financial information for the quarter ended June 30, 2003 as if we had used the fair value method to account for employee stock compensation beginning January 1, 2003.
(b) Diluted earnings per share for 2004 and 2003 was calculated using an assumed increase in net income of $224.4 thousand and $302.0 thousand, respectively, related to the after-tax compensation expense from dividends on restricted shares.

Omnicom Group Inc.

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

Six Months Ended June 30 2004 2003(a)
           
Revenue   $    4,639.2   $    4,086.8  
           
Operating expenses   4,066.1   3,565.2  


Operating income   573.1   521.6  
           
Net interest expense   17.7   21.2  


Income before income taxes   555.4   500.4  
           
Income taxes   186.7   171.1  


Income after income taxes   368.7   329.3  
           
Equity in affiliates   7.3   4.4  
Minority interests   (34.3 ) (38.1 )


Net income   $        341.7   $        295.6  


Earnings per share  
         Basic   $          1.82   $          1.58  
         Diluted   $          1.81   $          1.58  
   
Weighted average shares (in millions)  
         Basic   187.3   186.9  
         Diluted (b)   188.8   186.9  
           
Dividend declared per share   $        0.450   $        0.400  


(a)In accordance with the adoption of SFAS No. 123, as amended by SFAS 148, on January 1, 2004 we restated our financial information for the six months ended June 30, 2003 as if we had used the fair value method to account for employee stock compensation beginning January 1, 2003.
(b) Diluted earnings per share for 2004 and 2003 was calculated using an assumed increase in net income of $423.9 thousand and $603.9 thousand, respectively, related to the after-tax compensation expense from dividends on restricted shares.

EX-99.2 3 e18534ex99_2.htm INVESTOR PRESENTATION EX-99.2

Exhibit 99.2


OmnicomGroup

SECOND QUARTER 2004 RESULTS
Investor Presentation

July 27, 2004

The following materials have been prepared for use in the July 27, 2004 conference call on Omnicom’s results of operations for the quarter ended June 30, 2004. 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


2004 vs. 2003 P&L Summary

    Second Quarter (a)
  Year to Date (a)
     2004
2003
 %
(Change)

    2004
2003
%
(Change)

Revenue   $2,407.8     $2,149.5   12.0%   $4,639.2   $4,086.8   13.5%
                           
Operating Income   343.7     319.3     7.6%   573.1   521.6    9.9%
% Margin   14.3%     14.9%       12.4%   12.8%    
                           
Net Interest Expense   7.3     12.9       17.7   21.2    
   
   
     
 
   
                           
Profit Before Tax   336.4     306.4     9.8%   555.4   500.4   11.0%
% Margin   14.0%     14.3%       12.0%   12.2%    
                           
Taxes   113.1     104.0       186.7   171.1    
% Tax Rate   33.6%     33.9%       33.6%   34.2%    
   
   
     
 
   
                           
Profit After Tax   223.3     202.4   10.3%   368.7   329.3   12.0%
                           
Equity in Affiliates   4.9     1.9       7.3   4.4    
Minority Interest   (22.1)     (24.3)       (34.3)   (38.1)    
   
   
     
 
   
                           
Net Income   $   206.1     $   180.0   14.5%   $  341.7   $   295.6   15.6%
   
   
     
 
   
                           

 

(a) In connection with our adoption on January 1, 2004 of SFAS 123 – “Accounting for Stock-Based Compensation” as amended by SFAS 148, “Accounting for Stock-Based Compensation – Transition and Disclosure, an amendment for FASB Statement No. 123”, utilizing the retroactive restatement method, stock-based compensation costs have been expensed in the current period and the results for the quarter ended June 30, 2003 and Year to Date 2003 have been restated as if we had used the fair value method to account for employee stock-based compensation beginning January 1, 2003.

 
OmnicomGroup 2


2004 vs. 2003 Earnings Per Share
  Second Quarter (a)
  Year to Date (a)
2004
    2003
   2004
    2003
Earnings per Share:              
Basic $  1.10 $  0.96 $ 1.82 $  1.58
Diluted 1.10 0.96 1.81 1.58
 
 
Weighted Average Shares (millions):
Basic 186.8 187.2 187.3 186.9
Diluted 188.2 187.2 188.8 186.9
 
Dividend Declared Per Share $0.225 $0.200 $0.450 $0.400



(a) In connection with our adoption on January 1, 2004 of SFAS 123 – “Accounting for Stock-Based Compensation” as amended by SFAS 148, “Accounting for Stock-Based Compensation – Transition and Disclosure, an amendment for FASB Statement No. 123”, utilizing the retroactive restatement method, stock-based compensation costs have been expensed in the current period and the results for the quarter ended June 30, 2003 and Year to Date 2003 have been restated as if we had used the fair value method to account for employee stock-based compensation beginning January 1, 2003.

 
OmnicomGroup 3


Potential Impact of EITF 04-8

2002
2003
2004
Q2 YTD

Net Income used for GAAP diluted EPS calculation, as reported   $571.4   $632.0   $342.2  
Proforma Addbacks:                                                                             
    Interest expense on Convertible Debt – net of tax   15.3 3.6  
    Book tax cost of interest expense disallowance on
    foreign tax credits
  5.0 12.6 7.9  
 


 
Diluted Net Income, proforma   $576.4 $659.9 $353.7  
   


 
   
Weighted Average Shares, diluted, as reported   186.2 187.6 188.8  
Additional shares assumed to be outstanding under the
“if converted” method
  14.5 19.2 21.6  
   


 
Weighted Average Shares, diluted, proforma   200.7 206.8 210.4  
   


 
   
Diluted EPS – GAAP, as reported   $3.07 $3.37 $1.81  
Diluted EPS – proforma   2.87 3.19 1.68  
 


 
Percentage decrease in Diluted EPS - proforma   6.5% 5.3% 7.2%  
   
 
 
 


Proforma Diluted EPS is calculated in accordance with the tentative conclusion reached by the Emerging Issues Task Force (“EITF”) with regard to Issue 04-8 -Accounting Issues Related to Certain Features of Contingently Convertible Debt and the Effect on Diluted Earnings per Share. Consistent with the tentative conclusion, this proforma calculation applies the “if converted”method set forth in SFAS 128 to our convertible notes when calculating Diluted EPS. The tentative conclusion issued by the EITF is subject to change before it is finalized. If the tentative conclusion is approved in its current form, it would be effective beginning with our December 31, 2004 financial statements. Additionally, all prior periods would be required to be restated and presented on the same basis for comparability.

The foregoing has been provided for illustrative purposes only. We cannot predict whether the referenced interpretation will be adopted or, if so, what its final provisions may be or actions, if any, we may take in respect thereof.

 
OmnicomGroup 4

2004 Total Revenue Growth
  Second Quarter
  Year to Date
$
   %
    $
   %
Prior Period Revenue   $2,149.5 $4,086.8    
   
Foreign Exchange (FX) Impact(a)   75.3 3.5%   205.1   5.0%
   
Acquisition Revenue(b)   54.7 2.5% 106.9   2.6%
   
Organic Revenue(c)   128.3 6.0% 240.4   5.9%
   



   
Current Period Revenue   $2,407.8 12.0% $4,639.2   13.5%
   
 
 
 

(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 5


2004 Revenue By Discipline
 

$ Mix
% Growth(a)
Advertising   1,059.9   12.3 %
   
CRM   808.7   10.3 %
   
PR   263.1   10.5 %
   
Specialty   276.1   17.8 %


$ Mix
% Growth(a)
Advertising   2,037.1   13.1 %
   
CRM   1,558.8   14.3 %
   
PR   502.4   9.2 %
   
Specialty   540.9   17.2 %

(a) “Growth” is the year-over-year growth from the prior period. Certain reclassifications have been made to the June 30, 2003 presentation to conform the numbers to the June 30, 2004 balances presented.

 
OmnicomGroup 6


2004 Revenue By Geography
 

$ Mix
$ Growth
United States   $1,312.2   $130.0  
Organic       84.2  
Acquisition       45.8  
International   $1,095.6   $128.3  
Organic       44.1  
Acquisition       8.9  
FX       75.3  
           
$ Mix
% Growth
United States   $1,312.2   11.0 %
Euro Currency Markets   503.8   12.7 %
United Kingdom   261.4   12.6 %
Other   330.4   13.3 %
           
$ Mix
$ Growth
United States   $2,533.4   $251.6  
Organic       162.2  
Acquisition       89.4  
International   $2,105.8   $300.8  
Organic       78.2  
Acquisition       17.5  
FX       205.1  
           
$ Mix
% Growth
United States   $2,533.4   11.0 %
Euro Currency Markets   959.6   15.0 %
United Kingdom   512.4   15.5 %
Other   633.8   20.2 %
           


 
OmnicomGroup 7


Current Credit Picture

  Second Quarter
2004
2003

Operating Income (EBIT) (a)   $1,143   $1,015  
Net Interest Expense (a)   $  39.3   $  34.4  
EBIT / Net Interest   29.1 x 29.5 x
Net Debt / EBIT   1.7 x 2.0 x

Debt:  
Bank Loans (Due Less Than 1 Year)   $     41   $     65  
$1.5 Billion Revolver Due 5/21/09      
CP issued under 364 Day Facility (b)      
5.20% Euro Notes Due 6/24/05 (c)   186   175  
$850 Million Convertible Notes Due 2/7/31   847   847  
$900 Million Convertible Notes Due 7/31/32   892   900  
$600 Million Convertible Notes Due 6/15/33   600   600  
Loan Notes and Sundry (various through 2012)   25   22  
   
 
 
Total Debt   $2,591   $2,609  
           
Cash and Short Term Investments   678   544  
   
 
 
Net Debt   $1,913   $2,065  
   
 
 

           
(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 2003 are restated to reflect the adoption of SFAS 123 – “Accounting for Stock-Based Compensation”.
(b) The underlying $500 million 364 Day Credit facility expires 5/21/05 plus one-year term out at Omnicom’s option.
(c) The change in the outstanding balance results from changes in the Euro to U.S. dollar currency exchange rate. The Euro balance outstanding as of June 30, 2004 and 2003 was €152.4.

 
OmnicomGroup 8


Current Liquidity Picture


  As of June 30, 2004
Total Amount
of Facility

Outstanding
Available
Committed Facilities        
               
   364 Day Revolving Credit Facility (a)   $   500   $  —   $    500  
               
   5 Year Revolving Credit Facility   1,500     1,500  
               
   Other Committed Credit Facilities   39   39    
   
 
 
 
Total Committed Facilities   2,039   39   2,000  
               
Uncommitted Facilities (b)   398   2    
   
 
 
 
Total Credit Facilities   $2,437   $  41   2,000  
               
      Cash & Short Term Investments       678  
           
 
      Total Liquidity Available       $2,678  
           
 


(a) The underlying $500 million 364 Day Credit facility expires 5/21/05 plus one-year term out at Omnicom’s option.
(b) Uncommitted facilities in the U.S., U.K. and Canada. These amounts are excluded for purposes of this analysis.

 
OmnicomGroup 9


Traditional Return on Equity(a)
 

(a) “Traditional Return on Equity” is Net Income for the given period divided by the shareholders’ equity at the end of the prior period. 2000 excludes a $63.8 million non-recurring after-tax gain from the sale of Razorfish shares. As a result of this exclusion, this presentation is a non-GAAP financial measure. We believe that by excluding this item, this schedule presents the calculation of traditional return on equity using amounts that are more comparable year to year and thus more meaningful for purposes of this analysis. If the Razorfish gain were included, the 2000 “Traditional Return on Equity” would have been 32.1% and the 10 year average would have been 29.1%.

(b) In connection with our adoption on January 1, 2004 of SFAS 123 – “Accounting for Stock-Based Compensation” as amended by SFAS 148 , “Accounting for Stock-Based Compensation – Transition and Disclosure, an amendment for FASB Statement No. 123”, utilizing the retroactive restatement method, stock-based compensation costs have been expensed in the current period and the results for the years ended December 31, 2002 and 2003 and the LTM period have been restated as if we had used the fair value method to account for employee stock-based compensation beginning January 1, 2003.

 
OmnicomGroup 10



Acquisitions Summary



Acquisition Related Expenditures


6 Months YTD 2004
New Subsidiary Acquisitions (a)   $  4  
 
Affiliates to Subsidiaries (b)    
 
Affiliates (c)   1  
 
Existing Subsidiaries (d)   60  
 
Earn-outs (e)   121  

 
Total Acquisition Expenditures   $186  
   
 

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 12


Potential Earn-out Obligations

      The following is an estimate of future earn-out related obligations as of June 30, 2004, assuming that the underlying acquired agencies continue to perform at their current levels: (a)


2004(b)
   2005
   2006
   2007
   Thereafter
   Total
 
$72   $157   $55   $53   $28   $365  



(a) The ultimate payments will vary as they are dependent on future events and changes in FX rates.
(b) Estimated remaining obligation as of June 30, 2004.
     

 
OmnicomGroup 13


Potential 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 obligations (as of June 30, 2004), assuming these underlying acquired agencies continue to perform at their current levels:(a)



Currently
Exercisable

Not Currently
Exercisable

Total
Subsidiary Agencies   $127   $93   $220  
Affiliated Agencies   24   9   33  
   
 
 
 
Total   $151   $102   $253  
   
 
 
 



(a) The ultimate payments will vary as they are dependent on future events and changes in FX rates.

 
OmnicomGroup 14



Second Quarter Acquisition
 

    

Exile on 7eventh LLC

     
    

Formed in 1996, Exile on 7eventh LLC is an interactive marketing communications services company. The Company combines online media planning and buying with creative online ad campaigns and campaign data analysis.

Exile on 7eventh is located in San Francisco and will be integrated into AGENCY.COM’s San Francisco office.

 
OmnicomGroup 15
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