Slide 1: Third Quarter 2019 Results
Third Quarter 2019 Results October 15, 2019 Investor Presentation
Slide 2: 2019 vs. 2018 P&L Summary
2019 vs. 2018 P&L Summary Third Quarter Third Quarter 2019 2018 (b) (c) Revenue $ 3,623.8 $ 3,714.3 Operating Expenses (a) 3,150.5 3,212.0 Operating Profit 473.3 502.3 Net Interest Expense 49.3 56.7 Income Tax Expense 112.3 115.3 Tax Rate % 26.5% 25.9% Income From Equity Method Investments 0.5 1.0 N
Slide 3: 2019 vs. 2018 Earnings per Share – Diluted
2019 vs. 2018 Earnings per Share – Diluted Third Quarter Third Quarter 2019 2018 (a) Net Income - Omnicom Group Inc. $ 290.2 $ 298.9 Diluted Shares (millions) 219.4 225.9 Earnings per Share - Diluted $ 1.32 $ 1.32 Dividends Declared Per Common Share $ 0.65 $ 0.60 (a) During the three months ended Se
Slide 4: 2019 vs. 2018 P&L Summary (Nine Months)
2019 vs. 2018 P&L Summary Year to Date Year to Date 2019 2018 (b) (c) Revenue $ 10,812.5 $ 11,203.5 Operating Expenses (a) 9,336.6 9,697.2 Operating Profit 1,475.9 1,506.3 Net Interest Expense 145.5 156.1 Income Tax Expense 345.5 343.0 Tax Rate % 26.0% 25.4% Income From Equity Method Investments 1.2
Slide 5: 2019 vs. 2018 Earnings per Share – Diluted (Nine Months)
2019 vs. 2018 Earnings per Share – Diluted Year to Date Year to Date 2019 2018 (a) Net Income - Omnicom Group Inc. $ 924.1 $ 927.2 Diluted Shares (millions) 221.5 228.5 Earnings per Share - Diluted $ 4.17 $ 4.06 Dividends Declared Per Common Share $ 1.95 $ 1.80 (a) During the third quarter of 2018,
Slide 6: 2019 vs. 2018 Non-GAAP Financial Measures
2019 vs. 2018 Non-GAAP Financial Measures - Excluding Impact of Third Quarter 2018 Dispositions, Repositioning Actions and the 2017 Tax Act Third Quarter Non-GAAP 2018 2019 2018 (a) (b) Adjusted (a) (b) Operating Profit $ 473.3 $ 502.3 $ 473.3 Net Interest Expense 49.3 56.7 56.7 Income Tax Expense 1
Slide 7: 2019 vs. 2018 Non-GAAP Financial Measures
2019 vs. 2018 Non-GAAP Financial Measures - Excluding Impact of Third Quarter 2018 Dispositions, Repositioning Actions and the 2017 Tax Act Third Quarter Non-GAAP 2018 2019 2018 (a) Adjusted (a) Net Income - Omnicom Group Inc. $ 290.2 $ 298.9 $ 280.7 Diluted Shares (millions) 219.4 225.9 225.9 Earni
Slide 8: 2019 vs. 2018 Non-GAAP Financial Measures
2019 vs. 2018 Non-GAAP Financial Measures - Excluding Impact of Third Quarter 2018 Dispositions, Repositioning Actions and the 2017 Tax Act Year to Date Non-GAAP 2018 2019 2018 (a) (b) Adjusted (a) (b) Operating Profit $ 1,475.9 $ 1,506.3 $ 1,477.3 Net Interest Expense 145.5 156.1 156.1 Income Tax E
Slide 9: 2019 vs. 2018 Non-GAAP Financial Measures
2019 vs. 2018 Non-GAAP Financial Measures - Excluding Impact of Third Quarter 2018 Dispositions, Repositioning Actions and the 2017 Tax Act Year to Date Non-GAAP 2018 2019 2018 (a) Adjusted (a) Net Income - Omnicom Group Inc. $ 924.1 $ 927.2 $ 909.0 Diluted Shares (millions) 221.5 228.5 228.5 Earnin
Slide 10: Total Revenue Change
2019 Total Revenue Change Third Quarter Year to Date $ %∆ $ %∆ Prior Period Revenue $ 3,714.3 $ 11,203.5 Foreign exchange rate impact (a) (56.6) -1.5% (278.9) -2.5% Acquisition revenue, net of disposition (116.8) -3.1% (394.6) -3.5% revenue (b) Organic growth (c) 82.9 2.2% 282.5 2.5% Current Period
Slide 11: Revenue by Discipline
2019 Revenue by Discipline Healthcare Healthcare Third Quarter 7.9% Year to Date 7.7% CRM PR CRM PR Execution 9.3% Execution 9.5% & Support & Support 9.3% 9.3% CRM CRM Consumer Consumer Experience Experience Advertising Advertising 17.6% 17.6% 55.9% 55.9% % Organic % Organic $ Mix % Growth Growth (a
Slide 12: Revenue by Region
2019 Revenue by Region Third Quarter Year to Date Latin Middle East Latin Middle East America & Africa America & Africa 2.8% 1.6% 2.6% 1.8% Asia Asia Pacific Pacific 11.6% 11.0% Euro Euro Markets & Markets & Other Other Europe Europe 16.6% United 17.4% United States States 55.0% 54.5% UK UK 9.6% 9.7
Slide 13: Revenue by Region
2019 Revenue by Region Third Quarter Year to Date % Organic % Organic $ Mix % Growth Growth (a) $ Mix % Growth Growth (a) United States $ 1,993.5 0.0% 2.7% United States $ 5,882.9 0.3% 2.6% Other North Other North 321.2 2.3% 6.9% 103.0 0.2% 2.7% America America UK 346.1 -3.1% 3.0% UK 1,045.9 -3.0% 3
Slide 14: Revenue by Industry
Revenue by Industry Year to Date – 2019 Year to Date – 2018 Auto Auto T&E T&E 11% 10% 7% 7% Telcom Telcom 5% 5% Consumer Consumer Products Products 9% Tech 9% 7% Tech 9% Financial Financial Services Retail Services 8% 5% 8% Retail 5% Food & Pharma & Food & Beverage Health Beverage Pharma & 13% 13% 1
Slide 15: Cash Flow Performance
Cash Flow Performance Nine Months Ended September 30 2019 2018 Net Income $ 986.1 $ 1,010.8 Depreciation and Amortization of Intangible Assets 175.3 202.7 Share-Based Compensation 53.6 53.9 Net gain from dispositions of subsidiaries — (178.4) Impact of 2017 Tax Act — 28.9 Other Items to Reconcile to
Slide 16: Cash Flow Performance
Cash Flow Performance Nine Months Ended September 30 2019 2018 Free Cash Flow (a) $ 1,208.1 $ 1,133.0 Primary Uses of Cash: Dividends paid to Common Shareholders 422.5 413.7 Dividends paid to Noncontrolling Interest Shareholders 71.6 104.7 Capital Expenditures 77.0 116.2 Acquisition of Businesses an
Slide 17: Current Credit Picture
Current Credit Picture Twelve Months Ended September 30 2019 2018 EBITDA (a) $ 2,339.7 $ 2,405.1 Gross Interest Expense on Indebtedness 242.5 235.0 EBITDA / Gross Interest Expense on Indebtedness 9.6 x 10.2 x Total Debt / EBITDA 2.2 x 2.0 x Net Debt (b) / EBITDA 1.1 x 1.1 x Debt Bank Loans (Due Less
Slide 18: Historical Returns
Historical Returns Return on Invested Capital (ROIC) (a): Twelve months ended September 30, 2019 23.0% Twelve months ended September 30, 2018 20.6% Return on Equity (b): Twelve months ended September 30, 2019 54.6% Twelve months ended September 30, 2018 48.2% (a) Return on Invested Capital is After
Slide 19: Supplemental Financial Information
Supplemental Financial Information October 15, 2019 18
Slide 20: Omnicom Debt Structure
Omnicom Debt Structure Short-term Debt $8 2031 Euro Senior Notes $548 2026 Senior 2027 Euro Notes Senior Notes $1,400 $548 2020 Senior Notes $600 2024 Senior Notes $750 2022 Senior Notes $1,250 The above chart sets forth Omnicom’s debt outstanding at September 30, 2019. The amounts reflected above f
Slide 21: Omnicom Debt Maturity Profile
Omnicom Debt Maturity Profile 2026 Senior 2022 Notes $1,400 Senior Notes $1,200 $1,000 2024 2020 Senior Notes 2027 2031 $800 Senior Euro Euro Notes Senior Senior $600 Notes Notes $400 $200 Other Borrowings $0 9 20 0 21 1 22 2 23 3 24 4 25 5 26 6 27 7 28 8 29 9 30 0 31 1 -1 -2 -2 -2 -2 -2 -2 -2 -2 -2
Slide 22: Acquisition Related Expenditures
2019 Acquisition Related Expenditures Nine Months Ended September 30 Acquisition of Businesses and Affiliates (a) $ 8.1 Acquisition of Additional Noncontrolling Interests (b) 31.1 Contingent Purchase Price Payments (c) 37.0 Total Acquisition Expenditures (d) $ 76.2 (a) Includes acquisitions of a maj
Slide 23: Condensed Cash Flow
Condensed Cash Flow Nine Months Ended September 30 2019 2018 Net Income $ 986.1 $ 1,010.8 Share-Based Compensation 53.6 53.9 Depreciation and Amortization of Intangible Assets 175.3 202.7 Other Items to Reconcile to Net Cash Used in Operating Activities, net (6.9) 15.1 Net gain from dispositions of
Slide 24: Supplemental Information
Supplemental Information Third Quarter Year to Date % of % of % of % of 2019 Rev 2018 Rev 2019 Rev 2018 Rev Revenue $ 3,623.8 $ 3,714.3 $10,812.5 $11,203.5 Operating expenses: Salary and service costs 2,704.7 74.6% 2,834.2 76.3% 7,937.5 73.4% 8,319.9 74.3% Occupancy and other costs 290.7 8.0% 376.8
Slide 25: 2018 Operating Expenses – Impact of Net Gain on Dispositions and Repositioning
2018 Operating Expenses – Impact of Net Gain on Dispositions and Repositioning Actions Increase (Decrease) Repositioning Net Gain on Total Actions Dispositions Operating expenses: Salary and service costs $ 73.7 $ — $ 73.7 Occupancy and other costs 73.5 — 73.5 Net gain on dispositions of subsidiarie
Slide 26: Net Cash Returned to Shareholders through Dividends and Share Repurchases
Net Cash Returned to Shareholders through Dividends and Share Repurchases From 2009 through September 30, 2019, Omnicom distributed 104% of Net Income to shareholders through Dividends and Share Repurchases. 104% 104% $12.0 $11.2 107% $10.3 $10.0 108% 4.4 $9.0 110% 3.9 $7.9 3.4 $8.0 $ In Billions 11
Slide 27: 2019 vs. 2018 Non-GAAP Financial Measures – EBITA
2019 vs. 2018 Non-GAAP Financial Measures – EBITA Third Quarter Year to Date 2019 2018 2019 2018 Revenue $ 3,623.8 $ 3,714.3 $ 10,812.5 $ 11,203.5 Operating expenses (a) 3,150.5 3,212.0 9,336.6 9,697.2 Operating Profit 473.3 502.3 1,475.9 1,506.3 Operating Profit Margin % 13.1% 13.5% 13.6% 13.4% Add
Slide 28: Reconciliation of Non-GAAP Financial Measures – EBITA and EBITDA
Reconciliation of Non-GAAP Financial Measures – EBITA and EBITDA Three Months Ended Nine Months Ended Twelve Months Ended September 30 September 30 September 30 2019 2018 2019 2018 2019 2018 Net Income - Omnicom Group Inc. $ 290.2 $ 298.9 $ 924.1 $ 927.2 $ 1,323.3 $ 1,181.6 Net Income Attributed to
Slide 29: 2018 Non-GAAP Financial Measures
2018 Non-GAAP Financial Measures - 2018 Excluding Net Gain on Dispositions, Repositioning Actions and Tax Reform Act Adjustments Third Quarter Year to Date Non-GAAP Non-GAAP Non-GAAP Non-GAAP 2018 Adjustments 2018 2018 Adjustments 2018 Adjusted Adjusted Operating Profit (a) $ 502.3 $ 29.0 $ 473.3 $
Slide 30: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Nine Months Ended September 30 2019 2018 Net Cash Used in Operating Activities $ (231.9) $ (238.6) Operating Activities items excluded from Free Cash Flow: Changes in Operating Capital (1,440.0) (1,371.6) Free Cash Flow $ 1,208.1 $ 1,133.0 Nine Months En
Slide 31: Reconciliation of 2018 Non-GAAP Financial Measures - Operating Profit
Reconciliation of 2018 Non-GAAP Financial Measures - Operating Profit Three Months Ended Nine Months Ended September 30 September 30 2019 2018 2019 2018 Net Income - Omnicom Group Inc. $ 290.2 $ 298.9 $ 924.1 $ 927.2 Net Income Attributed to Noncontrolling Interests 22.0 32.4 62.0 83.6 Net Income 31
Slide 32: Reconciliation of 2018 Non-GAAP Financial Measures - Net Income
Reconciliation of 2018 Non-GAAP Financial Measures - Net Income - Omnicom Group Inc. Three Months Nine Months Ended Ended September 30, September 30, 2018 2018 Net Income - Omnicom Group Inc., as reported $ 298.9 $ 927.2 Net gain from dispositions before income tax expense (178.4) (178.4) Reposition
Slide 33: Third Quarter Acquisition
Third Quarter Acquisition Smart Digital GmbH is a leading consulting and marketing technology company that uses specialized AI and data capabilities to power real-time customer experiences. Smart Digital’s service portfolio ranges from the deployment of real-time personalization and optimization, to
Slide 34: Disclosure
Disclosure The preceding materials have been prepared for use in the October 15, 2019 conference call on Omnicom’s results of operations for the three and nine months ended September 30, 2019. The call will be archived on the Internet at http://investor.omnicomgroup.com/investor-relations/news-event