Omnicom Group Inc. · NYSE:OMC
Omnicom — FY2005 Earnings Presentation
23 slides from Omnicom's earnings presentation, Feb 14, 2006
Slide 1: Omnicom Group Full Year 2005 Results
Exhibit 99.2 Omnicom Group FULL YEAR 2005 RESULTS Investor Presentation February 14, 2006
Slide 2: Forward-Looking Statements and Other Information
The following materials have been prepared for use in the February 14, 2006 conference call on Omnicom’s results of operations for the year ended December 31, 2005. The call will be archived on the Internet at http://www.omnicomgroup.com/financialwebcasts. Forward-Looking Statements Certain of the s
Slide 3: 2005 vs. 2004 P&L Summary
2005 vs. 2004 P&L Summary Fourth Quarter Full Year 2005 2004 % Change 2005 2004 % Change Revenue $ 2,939.4 $ 2,789.0 5.4% $ 10,481.1 $ 9,747.2 7.5% Operating Income 426.1 394.9 7.9% 1,339.8 1,215.4 10.2% % Margin 14.5% 14.2% 12.8% 12.5% Net Interest Expense 16.5 10.0 59.2 36.6 Profit Before Tax 409.
Slide 4: 2005 vs. 2004 Earnings Per Share
2005 vs. 2004 Earnings Per Share Fourth Quarter Full Year 2005 2004 2005 2004 Earnings per Share: Basic $ 1.42 $ 1.28 $ 4.38 $ 3.90 Diluted 1.41 1.28 4.36 3.88 Weighted Average Shares (millions): Basic 178.2 184.1 180.4 185.7 Diluted 179.6 185.2 181.8 186.6 Dividend Declared Per Share $0.250 $0.225
Slide 5: 2005 Total Revenue Growth
2005 Total Revenue Growth Fourth Quarter Full Year $ % $ % Prior Period Revenue $ 2,789.0 $ 9,747.2 Foreign Exchange (FX) Impact (a) (59.9) -2.1% 53.3 0.5% Acquisition Revenue (b) (2.8) -0.1% (28.8) -0.3% Organic Revenue (c) 213.1 7.6% 709.4 7.3% Current Period Revenue $ 2,939.4 5.4% $ 10,481.1 7.5%
Slide 6: 2005 Revenue By Discipline
2005 Revenue By Discipline Fourth Quarter Full 2005 Year PR PR 9.1% 10.0% CRM CRM 35.1% Advertising 34.5% Advertising 44.4% 43.8% Specialty Specialty 11.4% 11.7% Pie Chart $ Mix % Growth (a) $ Mix % Growth (a) Advertising 1,305.6 8.6% #### Advertising 4,589.0 9.1% CRM 1,032.8 3.5% #### CRM 3,613.0 6
Slide 7: 2005 Revenue By Geography
2005 Revenue By Geography Fourth Quarter Full Year 2005 Euro Euro Markets United Markets 21.3% United States States 20.6% 53.6% UK 54.8% UK 10.4% 10.5% Other Other 14.7% 14.1% $ Mix $ Growth(a) $ Mix $ Growth(a) United States $ 1,575.5 $ 133.6 United States $ 5,743.9 $ 520.5 Organic 116.7 Organic 46
Slide 8: Cash Flow – GAAP Presentation (condensed)
Cash Flow – GAAP Presentation (condensed) Full Year 2005 2004 Net Income $ 790.7 $ 723.5 Stock-Based Compensation Expense 102.8 143.4 Depreciation and Amortization 175.2 172.1 Other non-cash items to reconcile to net income 73.5 79.1 Other changes in Working Capital (151.0) 169.5 Net Cash Provided b
Slide 9: After-Tax Free Cash Flow
After-Tax Free Cash Flow(a) Full Year 2005 2004 Net Income $ 790.7 $ 723.5 Stock-Based Compensation Expense 102.8 143.4 Depreciation and Amortization 175.2 172.1 Cash-Tax Differences (b) 100.2 108.7 After-Tax Free Cash Flow $ 1,168.9 $ 1,147.7 Primary Cash Uses: Capital Expenditures 162.7 159.7 Divi
Slide 10: Current Credit Picture
Current Credit Picture Full Year 2005 2004 Operating Income (EBIT)(a) $ 1,340 $ 1,215 Net Interest Expense(a) $ 59.2 $ 36.6 EBIT / Net Interest 22.6 x 33.2 x Net Debt / EBIT 0.9 x 0.7 x Debt: Bank Loans (Due Less Than 1 Year) $ 15 $ 18 CP issued under $2.1B - 5 Year Revolver Due 5/23/10 - - 5.20% Eu
Slide 11: Current Liquidity Picture
Current Liquidity Picture Total Amount As of December 31, 2005 Of Facility Outstanding Available Committed Facilities 364 Day Revolver Due 6/29/06 (a) $ 400 $ - $ 400 CP issued - backed by 5 Year Revolver (b) 2,100 - 2,100 Other Committed Credit Facilities 12 12 - Total Committed Facilities 2,512 12
Slide 12: Return on Equity
Return on Equity(a) 3 Year Average (2003-2005) = 22.8% (a) “Return on Equity” is constant dollar based Net Income for the given period divided by the shareholders’ equity at the end of the prior period which has also been adjusted to a constant dollar basis. In connection with our adoption on Januar
Slide 13: Acquisitions Summary
Acquisitions Summary OmnicomGroup
Slide 14: Acquisition Related Expenditures
Acquisition Related Expenditures Full Year New Subsidiary Acquisitions (a) $ 78 Affiliates to Subsidiaries (b) - Affiliates (c) 1 Existing Subsidiaries (d) 43 Earn-outs (e) 205 Total Acquisition Expenditures $ 327 Note: See appendix for subsidiary acquisition profiles. (a) Includes acquisitions of a
Slide 15: Potential Earn-out Obligations
Potential Earn-out Obligations The following is a calculation of future earn-out obligations as of December 31, 2005, assuming that the underlying acquired agencies continue to perform at their current levels:(a) 2006 2007 2008 2009 Thereafter Total $ 126 $ 113 $ 89 $ 47 $ 22 $ 397 (a) The ultimate
Slide 16: Potential Obligations
Potential Obligations In conjunction with certain transactions Omnicom has agreed to acquire (at the sellers’ option) additional equity interests. The following is a calculation of these potential future obligations (as of December 31, 2005), assuming these underlying acquired agencies continue to p
Slide 17: Fourth Quarter Acquisitions: The Beanstalk Group
Fourth Quarter Acquisitions The Beanstalk Group The Beanstalk Group is the world’s leading brand licensing agency and consultancy. Beanstalk helps its clients license their famous trademarks, copyrights and images to enhance the value of their brands and to create new revenue streams. The agency is
Slide 18: Fourth Quarter Acquisitions: ipsh!
Fourth Quarter Acquisitions ipsh! ipsh! is a leader in innovating, developing and deploying effective, mobile marketing strategies for clients. Formed in 2001, the company is a full-service, mobile advertising agency. The company will become part of the Marketing Arm and is located in San Francisco,
Slide 19: Fourth Quarter Acquisitions: The Marketing Partners
Fourth Quarter Acquisitions The Marketing Partners The Marketing Partners (“TMP”) is a promotion agency founded in 1987. While its core competency is consumer promotions for packaged goods companies, TMP also offers a range of services including consumer promotion, advertising, market research, pack
Slide 20: Fourth Quarter Acquisitions: Myalo
Fourth Quarter Acquisitions Myalo Myalo is an interactive marketing agency whose clients are leaders in the tourism, telecommunications and financial services industries. The agency shares a number of clients with the TBWA group and is located Kuala Lumpur, Malaysia. The agency will become part of T
Slide 21: Fourth Quarter Acquisitions: Resolution Media
Fourth Quarter Acquisitions Resolution Media Resolution Media is a leading search engine marketing agency offering customized business solutions through search marketing strategy, optimization and integration. The agency provides centralized solutions for leveraging all aspects of a client’s search
Slide 22: Fourth Quarter Acquisitions: Shockwaved
Fourth Quarter Acquisitions Shockwaved Shockwaved is an integrated dialogue and digital marketing agency. The agency specializes in customer relationship management through the use of integrated media. The agency is located in Copenhagen, Denmark and is part of TBWA Interactive. 21
Slide 23: Fourth Quarter Acquisitions: The Works
Fourth Quarter Acquisitions The Works The Works is one of Europe’s largest sponsorship and experiential event consultancies serving an international client base which reaches across the Sport, Music, Film and Fashion industries. The Works is headquartered in London, England and is a member of the Ra