Slide 1: Second Quarter 2015 Results
Second Quarter 2015 Results July 21, 2015 Investor Presentation
Slide 2: 2015 vs. 2014 P&L Summary – Second Quarter
2015 vs. 2014 P&L Summary – Second Quarter Second Quarter 2015 Reported 2014 Reported Revenue $ 3,805.3 $ 3,870.9 EBITA (a) 565.7 574.2 Margin % 14.9% 14.8% Amortization of Intangibles 27.1 25.8 Operating Income $ 538.6 $ 548.4 Margin % 14.2% 14.2% (a) EBITA is a non-GAAP financial measure. See page
Slide 3: 2015 vs. 2014 P&L Summary – Second Quarter
2015 vs. 2014 P&L Summary – Second Quarter Second Quarter 2015 2014 2014 Exclude Reported Reported Tax Benefit (a) Operating Income $ 538.6 $ 548.4 $ 548.4 Net Interest Expense 34.6 33.7 33.7 Income Taxes 165.3 160.3 171.5 (b) Tax Rate % 32.8% 31.1% 33.3% (b) Income from Equity Method Investments 4.
Slide 4: 2015 vs. 2014 Earnings Per Share – Second Quarter
2015 vs. 2014 Earnings Per Share – Second Quarter Second Quarter 2015 2014 2014 Exclude (a) Reported Reported Tax Benefit Net Income - Omnicom Group $ 313.9 $ 325.2 $ 314.0 (b) Net Income allocated to Participating Securities (3.9) (6.3) (6.1) Net Income available for common shares $ 310.0 $ 318.9 $
Slide 5: 2015 vs. 2014 P&L Summary – Year to Date
2015 vs. 2014 P&L Summary – Year to Date Year to Date 2015 Reported 2014 Reported Revenue $ 7,274.5 $ 7,373.0 EBITA (a) 970.8 981.3 Margin % 13.3% 13.3% Amortization of Intangibles 54.5 50.2 Operating Income $ 916.3 $ 931.1 Margin % 12.6% 12.6% (a) EBITA is a non-GAAP financial measure. See page 29
Slide 6: 2015 vs. 2014 P&L Summary – Year to Date
2015 vs. 2014 P&L Summary – Year to Date Year to Date 2015 2014 2014 Exclude Reported Reported Tax Benefit (a) Operating Income $ 916.3 $ 931.1 $ 931.1 Net Interest Expense 68.8 72.7 72.7 Income Taxes 278.0 276.5 287.7 (b) Tax Rate % 32.8% 32.2% 33.5% (b) Income from Equity Method Investments 3.0 4.
Slide 7: 2015 vs. 2014 Earnings Per Share – Year to Date
2015 vs. 2014 Earnings Per Share – Year to Date Year to Date 2015 2014 2014 Exclude (a) Reported Reported Tax Benefit Net Income - Omnicom Group $ 523.0 $ 530.7 $ 519.5 (b) Net Income allocated to Participating Securities (6.7) (10.4) (10.2) Net Income available for common shares $ 516.3 $ 520.3 $ 5
Slide 8: Total Revenue Change – Second Quarter
2015 Total Revenue Change – Second Quarter $(275) $204 $3,871 $5 $3,805 (7.1)% 0.1% 5.3% (a) (c) 2Q '14 FX Impact Net Organic 2Q '15 (b) Acquisitions Revenue (a) To calculate the FX impact, we first convert the current period’s local currency revenue using the average exchange rates from the equival
Slide 9: Total Revenue Change – Year to Date
2015 Total Revenue Change – Year to Date $(500) $383 $19 $7,373 $7,275 (6.8)% 0.3% 5.2% (a) (c) YTD '14 FX Impact Net Organic YTD '15 (b) Acquisitions Revenue (a) To calculate the FX impact, we first convert the current period’s local currency revenue using the average exchange rates from the equiva
Slide 10: Revenue by Region
2015 Revenue by Region Second Quarter Year to Date Latin Africa Latin Africa America MidEast America MidEast 2.2% 1.8% 2.3% 1.7% Asia Asia Pacific Pacific 10.4% 10.3% Euro Euro Markets & Markets & Other Other Europe Europe 15.9% 16.0% North North America UK America UK 59.8% 59.9% 9.9% 9.8% July 21,
Slide 11: Revenue by Region
2015 Revenue by Region Second Quarter Year to Date % Organic % Organic (a) (a) $ Mix % Growth Growth $ Mix % Growth Growth North America $ 2,281.5 4.6% 5.9% North America $ 4,348.6 4.3% 5.4% UK 372.0 -3.0% 5.4% UK 718.6 -0.5% 7.2% Euro & Other Europe 606.8 -16.6% 3.9% Euro & Other Europe 1,161.6 -16
Slide 12: Revenue by Discipline
2015 Revenue by Discipline Second Quarter Year to Date Specialty Specialty 7.6% 7.5% PR PR 9.3% 9.4% Advertising Advertising 49.9% 50.5% CRM CRM 32.6% 33.2% % Organic % Organic $ Mix % Growth Growth (a) $ Mix % Growth Growth (a) Advertising $ 1,922.1 -1.2% 6.4% Advertising $ 3,631.3 -0.2% 7.0% CRM 1
Slide 13: Revenue by Industry
Revenue by Industry Year to Date – 2015 Year to Date – 2014 T&E Auto T&E Auto 6% 8% 6% 8% Telcom Telcom 5% 5% Consumer Consumer Products Products Tech Tech 9% 9% 9% 9% Financial Financial Services Services 7% Retail Retail 7% 7% 7% Food & Food & Beverage Pharma & Beverage Pharma & 13% Health 13% Hea
Slide 14: Cash Flow Performance
Cash Flow Performance Six Months Ended June 30 2015 2014 Net Income $ 572.5 $ 586.5 Depreciation and Amortization Expense 147.0 143.3 Share-Based Compensation Expense 49.3 43.9 Other Non-Cash Items to Reconcile to Net Cash Used in Operating (12.0) (14.3) Activities, net Free Cash Flow (a) $ 756.8 $
Slide 15: Cash Flow Performance
Cash Flow Performance Six Months Ended June 30 2015 2014 Free Cash Flow (a) $ 756.8 $ 759.4 Primary Uses of Cash: Dividends 250.5 211.8 Dividends paid to Noncontrolling Interest Shareholders 61.1 66.5 Capital Expenditures 106.7 91.5 Acquisition of Businesses and Affiliates, Acquisition of Additional
Slide 16: Current Credit Picture
Current Credit Picture Twelve Months Ended June 30 2015 2014 EBITDA (a) $ 2,227.3 $ 2,147.9 Gross Interest Expense 172.4 192.1 EBITDA / Gross Interest Expense 12.9 x 11.2 x Total Debt / EBITDA 2.1 x 1.9 x (b) Net Debt / EBITDA 1.4 x 1.2 x Debt Bank Loans (Due Less Than 1 Year) $ 14 $ 25 CP & Borrowi
Slide 17: Historical Returns
Historical Returns Return on Invested Capital (ROIC) (a) : Twelve Months Ended June 30, 2015 17.6% Twelve Months Ended June 30, 2014 16.9% Return on Equity (b): Twelve Months Ended June 30, 2015 35.9% Twelve Months Ended June 30, 2014 31.5% (a) Return on Invested Capital is After Tax Reported Operat
Slide 18: Net Cash Returned to Shareholders through Dividends and Share Repurchases
Net Cash Returned to Shareholders through Dividends and Share Repurchases From 2004 through June 30, 2015, Omnicom distributed over 100% of Net Income to shareholders through Dividends and Share Repurchases. 109% 108% $10.5 104% $10.0 107% $10.0 $8.9 103% $7.9 $ In Billions $8.0 103% $6.9 92% 8.4 10
Slide 19: Supplemental Financial Information
Supplemental Financial Information July 21, 2015 18
Slide 20: Omnicom Debt Structure
Omnicom Debt Structure Bank Loans $14 2024 Senior Notes $750 2016 Senior Notes $1,000 2019 Senior Notes 2022 Senior Notes $500 $1,250 2020 Senior Notes $1,000 The above chart sets forth Omnicom’s debt outstanding at June 30, 2015. The amounts reflected above for the 2016, 2019, 2020, 2022 and 2024 S
Slide 21: Omnicom Debt Maturity Profile
Omnicom Debt Maturity Profile 2022 Senior Notes $1,250 2016 2020 Senior Senior Notes Notes $1,000 2024 Senior Notes $750 2019 Senior Notes $500 $250 Other Borrowings $0 Other borrowings at June 30, 2015 include short-term borrowings of $14 million which are due in less than one year. For purposes of
Slide 22: Historical Return Trends
Historical Return Trends Return on Equity Average through June 30, 2015 – 25.9% Return on Invested Capital Average through June 30, 2015 - 20.4% ROE(a) 40.0% ROIC(b) 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 201
Slide 23: Acquisition Related Expenditures
2015 Acquisition Related Expenditures Year to Date (a) Acquisition of Businesses and Affiliates $ 25.0 (b) Acquisition of Additional Noncontrolling Interests 6.9 (c) Contingent Purchase Price Payments 42.3 Total Acquisition Expenditures (d) $ 74.2 (a) Includes acquisitions of a majority interest in
Slide 24: Condensed Cash Flow
Condensed Cash Flow Six Months Ended June 30 2015 2014 Net Income $ 572.5 $ 586.5 Share-Based Compensation Expense 49.3 43.9 Depreciation and Amortization 147.0 143.3 Other Non-Cash Items to Reconcile to Net Cash Used in Operating Activities, net (12.0) (14.3) Changes in Operating Capital (808.8) (9
Slide 25: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures 3 Months Ended June 30 6 Months Ended June 30 12 Months Ended June 30 2015 2014 2015 2014 2015 2014 Revenue $ 3,805.3 $ 3,870.9 $ 7,274.5 $ 7,373.0 $ 15,219.3 $ 14,921.7 Operating Expenses, excluding Depreciation and 3,194.0 3,250.1 6,211.2 6,298.6 12,992.0 12,773
Slide 26: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures Second Quarter 2014 Merger-related 2014 Exclude Tax Reported Tax Benefit Benefit EBITA $ 574.2 $ - $ 574.2 Operating Income 548.4 - 548.4 Income Tax Expense 160.3 11.2 171.5 Net Income - Omnicom Group Inc. 325.2 11.2 314.0 Net Income allocated to participating sec
Slide 27: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures Six Months Ended June 30 2015 2014 Net Free Cash Flow $ (112.7) $ (269.6) Cash Flow items excluded from Net Free Cash Flow: Changes in Operating Capital (808.8) (946.9) Proceeds from Short-term Debt, net 1.1 18.3 Other Financing Activities, net (19.9) (13.9) Effec
Slide 28: Supplemental Information
Supplemental Information Second Quarter Year to Date 2015 2014 %∆ 2015 2014 %∆ Operating expenses: Salary and service costs $ 2,789.7 $ 2,794.6 -0.2% $ 5,410.5 $ 5,417.4 -0.1% Office and general expenses: Amortization of Intangibles 27.1 25.8 54.5 50.2 Depreciation 45.6 46.6 92.5 93.1 Other office a
Slide 29: Second Quarter Acquisition
Second Quarter Acquisition Established in 2009 with a focus on search and web analytics, Semetis is a market leader in optimizing digital advertising campaigns (search, branding, RTB, mobile, social, local, remarketing), utilizing analytics, digital business intelligence and custom technology. Semet
Slide 30: Disclosure
Disclosure The preceding materials have been prepared for use in the July 21, 2015 conference call on Omnicom’s results of operations for the period ended June 30, 2015. The call will be archived on the Internet at http://www.omnicomgroup.com/financialwebcasts. Forward-Looking Statements Certain sta