Omnicom Group Inc. · NYSE:OMC
Omnicom — Q2 2022 Earnings Presentation
24 slides from Omnicom's earnings presentation, Jul 19, 2022
Slide 1: 2022 Second Quarter
2022 Second Quarter July 19, 2022
Slide 2: Second Quarter Highlights
Second Quarter Highlights Organic strength continues Profits increasing – 11.3% organic revenue growth – Net income per diluted share of $1.68, +5.0% from 2021 or +15.1% (non-GAAP adjusted(a)) – Strong across all disciplines & geographies – Precision Marketing (+21.0% organic) is now – Operating pro
Slide 3: Income Statement Summary
Income Statement Summary Second Quarter Year to Date 2022 2021 2022 2021 Revenue $ 3,567.2 $ 3,571.6 $ 6,977.5 $ 6,998.6 Operating Expenses (a)(c) 3,025.6 3,003.2 6,082.9 5,964.8 Operating Profit 541.6 568.4 894.6 1,033.8 Net Interest Expense(b) 40.1 73.5 82.9 121.0 Income Tax Expense(c) 133.1 123.2
Slide 4: Income Statement Summary - Adjusted
Income Statement Summary - Adjusted Second Quarter Year to Date Non-GAAP Non-GAAP Non-GAAP Reported Reported Non-GAAP Reported Non-GAAP Reported Non-GAAP Adjusted Adjusted Adjusted 2022 2021 Adjustments 2022 Adjustments 2021 Adjustments 2021 2022 2021 Revenue $ 3,567.2 $ 3,571.6 $ — $ 3,571.6 $ 6,97
Slide 5: Revenue Change
Revenue Change Second Quarter Year to Date $ %∆ $ %∆ Prior Period Revenue $ 3,571.6 $ 6,998.6 Foreign exchange rate impact (a) (168.4) (4.7)% (253.5) (3.6)% Acquisition revenue, net of disposition revenue (b) (239.8) (6.7)% (579.4) (8.3)% Organic growth (c) 403.8 11.3 % 811.8 11.6 % Current Period R
Slide 6: Revenue by Discipline
Revenue by Discipline Second Quarter Year to Date % % Organic % % Organic Revenue % of Rev Growth(b) Growth (a) Revenue % of Rev Growth(b) Growth (a) Advertising & Media $ 1,831.0 51.3 % (9.1)% 8.2 % Advertising & Media $ 3,600.4 51.6 % (10.4)% 8.6 % Precision Marketing 362.0 10.2 % 23.3 % 21.0 % Pr
Slide 7: Revenue by Region
Revenue by Region Second Quarter Year to Date % % Organic % % Organic Revenue % of Rev Growth(b) Growth (a) Revenue % of Rev Growth(b) Growth (a) United States $ 1,842.8 51.7 % 0.1 % 10.7 % United States $ 3,567.4 51.1 % (3.8)% 10.7 % Other North America 126.7 3.6 % 8.6 % 12.5 % Other North America
Slide 8: Revenue by Industry Sector
Revenue by Industry Sector Year to Date June 30, 2022 2021 Pharmaceuticals and Healthcare 16 % 16 % Food and Beverage 14 % 14 % Technology 12 % 9% Auto 10 % 10 % Consumer Products 8% 8% Financial Services 7% 7% Travel and Entertainment 6% 9% Retail 6% 7% Telecommunications 5% 5% Government 3% 3% Ser
Slide 9: Operating Expense Detail
Operating Expense Detail Second Quarter Year to Date 2022 % of Rev 2021(c) % of Rev 2022(b) % of Rev 2021 % of Rev Revenue(a) $ 3,567.2 $ 3,571.6 $ 6,977.5 $ 6,998.6 Operating expenses: Salary and related service costs(a) 1,800.8 50.5 % 1,721.7 48.2 % (a) 3,595.4 51.5 % 3,370.9 48.2 % Third-party se
Slide 10: Adjusted Non-GAAP Operating Profit & Adjusted EBITA
Adjusted Non-GAAP Operating Profit & Adjusted EBITA Second Quarter Year to Date Reported Reported Adjusted Reported Adjusted Reported Adjusted 2022 2021 Adjustments 2021 2022 Adjustments 2022 2021 Adjustments 2021 Revenue $ 3,567.2 $ 3,571.6 $ — $ 3,571.6 $ 6,977.5 $ — $ 6,977.5 $ 6,998.6 $ — $ 6,99
Slide 11: Cash Flow Performance
Cash Flow Performance Six Months Ended June 30 2022 2021 Free Cash Flow (a) $ 767.7 $ 795.5 Primary Uses of Cash: Dividends paid to Common Shareholders 293.6 292.4 Dividends paid to Noncontrolling Interest Shareholders 37.7 38.6 Capital Expenditures 42.5 22.9 Acquisition payments, including payment
Slide 12: Credit & Liquidity
Credit & Liquidity $ Millions Twelve Months Ended June 30 2022 2021 EBITDA (a) $ 2,274.9 $ 2,365.2 Total Debt / EBITDA 2.4 x 2.2 x Net Debt (b) / EBITDA 1.0 x 0.4 x Debt Bank Loans (Due Less Than 1 Year) $ 12.3 $ 9.3 USD-denominated Senior Notes 4,150.0 4,150.0 EUR-denominated Senior Notes 1,041.6 1
Slide 13: Historical Returns
Historical Returns Return on Invested Capital (ROIC)(a) Return on Equity(b) Twelve months ended June 30, 2022 24.4 % Twelve months ended June 30, 2022 41.9 % Twelve months ended June 30, 2021 25.9 % Twelve months ended June 30, 2021 46.8 % (a) Return on Invested Capital is After Tax Reported Operati
Slide 14: Appendix
Appendix 14
Slide 15: Free Cash Flow
Free Cash Flow Six Months Ended June 30 2022 2021 Net Income $ 564.6 $ 677.5 Depreciation and Amortization of Intangible Assets 110.9 106.8 Share-Based Compensation 40.1 39.1 Non-cash charge related to the effects of the war in Ukraine 65.8 — Other Items to Reconcile to Net Cash Used in Operating Ac
Slide 16: Operating Expense Detail - Constant $
Operating Expense Detail - Constant $ Second Quarter Year to Date 2022 2022 C$(c) 2021 2022 2022 C$(c) 2021 Operating expenses: Salary and related service costs $ 1,800.8 $ 1,885.6 $ 1,721.7 $ 3,595.4 $ 3,725.1 $ 3,370.9 Third-party service costs (a) 765.2 803.0 881.4 1,462.4 1,517.9 1,777.2 Occupan
Slide 17: Non-GAAP Reconciliations
Non-GAAP Reconciliations Six Months Ended June 30 2022 2021 Net Cash Used in Operating Activities $ (739.9) $ (295.7) Operating Activities items excluded from Free Cash Flow: Changes in Operating Capital (1,507.6) (1,091.2) Free Cash Flow $ 767.7 $ 795.5 Net Decrease in Cash and Cash Equivalents $ (
Slide 18: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended Six Months Ended Twelve Months Ended June 30 June 30 June 30 2022 2021 2022 2021 2022 2021 Net Income - Omnicom Group Inc. $ 348.4 $ 348.2 $ 522.2 $ 636.0 $ 1,294.0 $ 1,347.4 Net Income Attributed to Noncontrolling Interests 21.6 23.4 42.4 41.5 100.7 93.5
Slide 19: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended Six Months Ended June 30, 2022 June 30, 2022 Non-GAAP Adjusted Non-GAAP Adjusted Operating Operating EBITA EBITA Profit Profit Net Income - Omnicom Group Inc. $ 348.4 $ 348.4 $ 522.2 $ 522.2 Net Income Attributed To Noncontrolling Interests 21.6 21.6 42.4
Slide 20: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended Six Months Ended June 30, 2021 June 30, 2021 Non-GAAP Adjusted Non-GAAP Adjusted Operating Operating EBITA EBITA Profit Profit Net Income - Omnicom Group Inc. $ 348.2 $ 348.2 $ 636.0 $ 636.0 Net Income Attributed To Noncontrolling Interests 23.4 23.4 41.5
Slide 21: Non-GAAP Reconciliations
Non-GAAP Reconciliations Second Quarter Year to Date 2022 2021 2022 2021 Net Income - Omnicom Group Inc. - Reported $ 348.4 $ 348.2 $ 522.2 $ 636.0 Gain on disposition of subsidiary (50.5) (50.5) Early extinguishment of debt 26.6 26.6 Tax expense on early extinguishment of debt (7.1) (7.1) Charges a
Slide 22: Partnerships: Retail media & e-commerce
Partnerships: Retail media & e-commerce • Jun 21 - WALMART: connecting Omni with Walmart's media business and DSP to help advertisers succeed across Walmart websites, apps and physical stores. • Jun 21 - INSTACART: connecting Omni with Instacart's data on the complete customer journey to give advert
Slide 23: Acquisition: TCA
Acquisition: TCA • May 2022 • Omnicom Media Group acquired TCA, a full- service performance marketing agency • Expertise in CTV and linear video for data- driven optimization and improved brand performance • Transforms TV from a top-of-funnel, brand- building marketing channel to an outcomes- based
Slide 24: Disclosures
Disclosures The preceding materials have been prepared for use in the July 19, 2022 conference call on Omnicom’s results of operations for the three and six months ended June 30, 2022. The call will be archived on the Internet at http:// investor.omnicomgroup.com/investor-relations/news-events-and-f