Omnicom Group Inc. · NYSE:OMC
Omnicom — Q3 2006 Earnings Presentation
20 slides from Omnicom's earnings presentation, Oct 24, 2006
Slide 1: Omnicom Group Third Quarter 2006 Results
Exhibit 99.2 Omnicom Group THIRD QUARTER 2006 RESULTS Investor Presentation October 24, 2006
Slide 2: Forward-Looking Statements
The following materials have been prepared for use in the October 24, 2006 conference call on Omnicom’s results of operations for the quarter ended September 30, 2006. The call will be archived on the Internet at http://www.omnicomgroup.com/financialwebcasts .. Forward-Looking Statements Certain of
Slide 3: 2006 vs. 2005 P&L Summary
2006 vs. 2005 P&L Summary Third Quarter Year to Date 2006 2005 % 2006 2005 % Revenue $ 2,774.3 $ 2,522.9 10.0% $ 8,160.7 $ 7,541.7 8.2% Operating Income 307.4 274.5 12.0% 1,009.3 913.7 10.5% % Margin 11.1% 10.9% 12.4% 12.1% Net Interest Expense 26.7 16.3 67.4 42.7 Profit Before Tax 280.7 258.2 8.7%
Slide 4: 2006 vs. 2005 Earnings Per Share
2006 vs. 2005 Earnings Per Share Third Quarter Year to Date 2006 2005 2006 2005 Earnings per Share: Basic $ 1.05 $ 0.90 $ 3.41 $ 2.97 Diluted 1.04 0.90 3.38 2.95 Growth Rate, Diluted 15.6% 14.6% Weighted Average Shares (millions): Basic 169.4 179.3 172.2 181.1 Diluted 170.9 180.6 173.8 182.5 Dividen
Slide 5: 2006 vs. 2005 P&L Summary – adjusted comparison
2006 vs. 2005 P&L Summary – adjusted comparison 3rd Quarter 2006 2005 Disposal (a) (b) (c) Reported Activity Adjusted Reported % Revenue $ 2,774.3 $ - $ 2,774.3 $ 2,522.9 10.0% Operating Income 307.4 0.5 307.9 274.5 12.2% % Margin 11.1% 11.1% 10.9% Net Interest Expense 26.7 - 26.7 16.3 Profit Before
Slide 6: Adjusted comparison 3rd Quarter footnotes
2006 vs. 2005 P&L Summary – adjusted comparison 3rd Quarter footnotes (a) During the third quarter of 2006, we disposed of a U.S. based healthcare business and several small businesses. The sale of the healthcare business resulted in a high book tax rate primarily caused by the non-deductibility of
Slide 7: Total Revenue Growth
2006 Total Revenue Growth Third Quarter Year to Date $ % $ % Prior Period Revenue $ 2,522.9 $ 7,541.7 Foreign Exchange (FX) Impact (a) 47.9 1.9% (13.4) -0.2% Acquisition Revenue (b) (4.4) -0.1% 29.2 0.4% Organic Revenue (c) 207.9 8.2% 603.2 8.0% Current Period Revenue $ 2,774.3 10.0% $ 8,160.7 8.2%
Slide 8: Revenue By Discipline
2006 Revenue By Discipline Third Quarter Year to 2006 Date PR PR 10.5% 10.3% CRM CRM 36.9% Advertising 35.4% Advertising 41.4% 42.6% Specialty Specialty 11.2% 11.7% Pie Chart $ Mix % Growth(a) $ Mix % Growth(a) Advertising 1,149.9 6.5% #### Advertising 3,474.2 5.8% CRM 1,023.4 16.7% #### CRM 2,893.8
Slide 9: Revenue By Geography
2006 Revenue By Geography Third Quarter Year to Date 2006 Euro Euro Markets Markets United 19.6% United States States 19.6% 55.5% UK 55.3% UK 11.1% 10.8% Other Other 13.8% 14.3% $ Mix $ Growth(a) $ Mix $ Growth(a) United States $ 1,540.5 $ 111.9 United States $ 4,508.9 $ 340.5 Organic 112.0 Organic
Slide 10: Cash Flow – GAAP Presentation (condensed)
Cash Flow – GAAP Presentation (condensed) 9 Months Ended September 30, 2006 2005 Net Income $ 586.8 $ 538.1 Stock-Based Compensation Expense 52.7 67.5 Windfall Tax Benefit on Stock Compensation - 14.5 Depreciation and Amortization 137.5 128.1 Other Non-Cash Items to Reconcile to Net Cash Provided by
Slide 11: Current Credit Picture
Current Credit Picture LTM ended September 30, 2006 2005 Operating Income (EBIT) (a) $ 1,435 $ 1,309 Net Interest Expense (a) $ 84.0 $ 52.7 EBIT / Net Interest 17.1 x 24.8 x Net Debt / EBIT 1.5 x 1.7 x Debt: Bank Loans (Due Less Than 1 Year) $ 12 $ 54 CP Issued Under $2.5B - 5 Year Revolver Due 6/23
Slide 12: Current Liquidity Picture
Current Liquidity Picture Total Amount As of September 30, 2006 Of Facility Outstanding Available Committed Facilities 5 Year Revolver (a) $ 2,500 $ - $ 2,500 Other Committed Credit Facilities 12 12 - Total Committed Facilities 2,512 12 2,500 Uncommitted Facilities(b) 345 - - (b) Total Credit Facili
Slide 13: Acquisitions Summary
Acquisitions Summary OmnicomGroup
Slide 14: Acquisition Related Expenditures
Acquisition Related Expenditures 9 Months YTD 2006 New Subsidiary Acquisitions (a) $ 61 Affiliates to Subsidiaries (b) - Affiliates (c) 13 Existing Subsidiaries (d) 23 Earn-outs (e) 125 Total Acquisition Expenditures $ 222 Note: See appendix for subsidiary acquisition profiles. (a) Includes acquisit
Slide 15: Potential Earn-out Obligations
Potential Earn-out Obligations The following is a calculation of future earn-out obligations as of September 30, 2006, assuming that the underlying acquired agencies continue to perform at their current levels: (a) 2006 2007 2008 2009 Thereafter Total $ 13 $ 156 $ 110 $ 72 $ 92 $ 443 (a) The ultimat
Slide 16: Potential Obligations
Potential Obligations In conjunction with certain transactions, Omnicom has agreed to acquire (at the sellers’ option) additional equity interests. If these rights are exercised, there would likely be an increase in our net income as a result of our increased ownership and the reduction of minority
Slide 17: Third Quarter Acquisitions: Colangelo Synergy Marketing
Third Quarter Acquisitions Colangelo Synergy Marketing Colangelo is a sales promotion agency providing strategic planning, concept development, media planning and buying, creative development, field marketing, interactive media services, event management, packaging design and production services. Th
Slide 18: Third Quarter Acquisitions: Gotocustomer Services India
Third Quarter Acquisitions Gotocustomer Services India Gotocustomer Services India is a leading provider of integrated marketing services to multinationals and local clients across India. The company currently provides services to industry leading clients in information technology, telecom products
Slide 19: Third Quarter Acquisitions: Go! Productions
Third Quarter Acquisitions Go! Productions Go! Productions develops and executes tradeshow and corporate meeting events for multinational clients. Additionally, the company provides consulting services around brand positioning, creative and strategic event planning and execution. Go! Productions is
Slide 20: Third Quarter Acquisitions: Rodgers Townsend
Third Quarter Acquisitions Rodgers Townsend Rodgers Townsend is a full-service creative communications agency providing advertising, direct marketing, media planning, interactive marketing and design services to its clients. Rodgers Townsend has been recognized internationally by One Show, National