Slide 1: Fourth Quarter 2011 Results
Investor Presentation Fourth Quarter 2011 Results February 14, 2012 February 14, 2012 1 Disclosure The following materials have been prepared for use in the February 14, 2012 conference call on Omnicom’s results of operations for the period ended December 31, 2011. The call will be archived on the I
Slide 2: 2011 vs. 2010 P&L Summary
2011 vs. 2010 P&L Summary Fourth Quarter (a) Full Year (a) 2011 2010 % 2011 2010 % Revenue $ 3,852.9 $ 3,586.8 7.4% $ 13,872.5 $ 12,542.5 10.6% EBITA (b) 511.1 459.8 11.2% 1,762.5 1,531.0 15.1% % Margin 13.3% 12.8% 12.7% 12.2% Amortization of Intangibles 23.7 20.2 91.4 70.8 Operating Income 487.4 43
Slide 3: 2011 Total Revenue Change
2011 Total Revenue Change Fourth Quarter Full Year $ % $ % Prior Period Revenue $ 3,586.8 $ 12,542.5 Foreign Exchange (FX) Impact (a) 0.9 0.0% 323.4 2.6% Acquisition/Disposition Revenue (b) 80.0 2.2% 236.0 1.9% Organic Revenue (c) 185.2 5.2% 770.6 6.1% Current Period Revenue $ 3,852.9 7.4% $ 13,872.
Slide 4: 2011 Revenue by Discipline
2011 Revenue by Discipline Fourth Quarter Full Year Specialty Specialty 8.3% 8.6% PR PR 8.1% 8.8% Advertising Advertising 46.1% 47.5% CRM CRM 36.1% 36.5% % Organic % Organic $ Mix % Change (a) $ Mix % Change (a) Change (b) Change (b) Advertising $1,832.3 9.7% 7.3% Advertising $6,401.2 12.7% 7.7% CRM
Slide 5: 2011 Revenue By Geography
2011 Revenue By Geography Fourth Quarter Full Year U.K. Other 8.5% U.K. 22.6% Other 8.8% 21.8% Euro Euro Markets U.S. Markets U.S. 18.8% 50.1% 18.6% 50.8% $ Mix $ Change (a) $ Mix $ Change (a) United States $ 1,928.7 $ 92.3 United States $ 7,048.7 $ 365.6 Organic 96.8 Organic 387.5 Acquisition (4.5)
Slide 6: Revenue By Industry
Revenue By Industry Fourth Quarter - 2011 Fourth Quarter - 2010 T&E Auto 8% Telecom 7% 6% T&E Auto 7% Consumer Consumer Telecom 7% 7% Products 11% Products 11% Technology 10% Financial Financial Technology 10% Retail 7% Services 12% Services 9% Retail 7% Pharma. & Food & Food & Health 10% Beverage 1
Slide 7: Cash Flow Performance
Cash Flow Performance Full Year 2011 2010 Free Cash Flow: Net Income $ 1,060.4 $ 923.7 Depreciation and Amortization Expense 273.7 253.0 Share-based Compensation Expense 74.5 69.3 Gain on Remeasurement of Equity Interest in Clemenger Group (123.4) -Gain on Remeasurement of Equity Interest in affilia
Slide 8: Net Cash Returned to Shareholders through Dividends and Share Repurchases
Net Cash Returned to Shareholders through Dividends and Share Re purchases Omnicom's Revenues and Net Income doubled in the past 10 years (a). During this period, Omnicom distributed over 95% of Net Income to shareholders, through Dividends and Share Repurchases. 9.0 $8.12 8.0 $7.73 7.0 6.0 illions
Slide 9: Current Credit Picture
Current Credit Picture Long-term Credit Ratings (a): BBB+ (S&P) Baa1 (Moody’s) Outlook (a): Stable (S&P and Moody’s) Full Year 2011 2010 EBITDA (b) $ 1,944.8 $ 1,713.2 Gross Interest Expense 158.1 134.7 EBITDA / Gross Interest Expense 12.3 x 12.7 x Total Debt / EBITDA 1.6 x 1.9 x Net Debt (f) / EBIT
Slide 10: Historical Returns
Historical Returns Return on Invested Capital (ROIC) (a) % Twelve Months Ended December 31, 2011 18.8 Twelve Months Ended December 31, 2010 16.8 Return on Equity (ROE) (b) % Twelve Months Ended December 31, 2011 26.9 Twelve Months Ended December 31, 2010 21.3 (a) Return on Invested Capital is After
Slide 11: Supplemental Financial Information
Supplemental Financial Information
Slide 12: Omnicom Debt Structure
Omnicom Debt Structure Bank Loans $10 2038 Convert $407 2032 Convert 2016 Senior Notes $253 $1,000 2020 Senior Notes 2019 Senior Notes $1,000 $500 The above chart sets forth Omnicom’s debt outstanding at December 31, 2011. The amounts reflected above for the 2016, 2019 and 2020 Senior Notes represen
Slide 13: Omnicom Debt Maturity Profile
Omnicom Debt Maturity Profile $1,200 2016 2020 Senior Notes Senior Notes $1,000 $800 2019 $600 Senior Notes 2038 Convert $400 2032 Convert $200 Other Borrowings $0 Dec 11 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Dec 18 Dec 19 Dec 20 Dec 21 Our 2032 Convertible Notes are putable on July 31, 2012 and
Slide 14: 2011 vs. 2010 Earnings Per Share
2011 vs. 2010 Earnings Per Share Fourth Quarter Full Year 2011 2010 2011 2010 Net Income per Common Share - Omnicom Group: Basic $ 0.97 $ 0.84 $ 3.38 $ 2.74 Diluted 0.96 0.83 3.33 2.70 Net Income Available for Common Shares: Net Income - Omnicom Group $ 271.9 $ 246.5 $ 952.6 $ 827.7 Net Income Alloc
Slide 15: Condensed Cash Flow
Condensed Cash Flow Full Year 2011 2010 Net Income $ 1,060.4 $ 923.7 Share-Based Compensation Expense 74.5 69.3 Depreciation and Amortization 273.7 253.0 Gain on Remeasurement of Equity Interest in Clemenger Group (123.4) -Gain on Remeasurement of Equity Interest in affiliates (15.1) (26.0) Other No
Slide 16: 2011 Acquisition Related Expenditures
2011 Acquisition Related Expenditures Full Year New Subsidiary Acquisitions (a) $ 189 Affiliates to Subsidiaries (b) 139 Affiliates (c) 3 Additional Interest in Controlled Subsidiaries (d) 39 Earn -outs (e) 73 Total Acquisition Expenditures (f) $ 443 (a) Includes acquisitions of a majority interest
Slide 17: Reconciliation of Non-GAAP Measures
Reconciliation of Non -GAAP Measures Fourth Quarter Full Year 2011 2010 2011 2010 Revenue $ 3,852.9 $ 3,586.8 $ 13,872.5 $ 12,542.5 Operating Expenses, excluding Depreciation and Amortization 3,295.3 3,079.8 11,927.7 10,829.3 EBITDA 557.6 507.0 1,944.8 1,713.2 Depreciation 46.5 47.2 182.3 182.2 EBIT
Slide 18: Reconciliation of Non-GAAP Measures
Reconciliation of Non -GAAP Measures Full Year 2011 2010 Net Free Cash Flow $ (437.6) $ (587.1) Cash Flow items excluded from Net Free Cash Flow: Changes in Operating Capital 68.0 310.3 (Repayments of) / Proceeds from Short-term & Long-term Debt, net (43.1) 1,025.1 Repayment of Convertible Debt (0.1
Slide 19: 2011 Non-GAAP Measures – Impact on Operating Expenses
2011 Non -GAAP Measures – Impact of Q1 Clemenger Remeasurement Gain and Repositioning Actions on Operating Expenses Q1 Clemenger 2011 Full Year Remeasurement Q1 Repositioning 2011 Full Year As Reported Gain Actions As Adjusted Salary & Service Expenses $ 10,250.6 $ - $ (92.8) $ 10,157.8 Office and G
Slide 20: 2011 Non-GAAP Measures – Impact on Income Taxes
2011 Non -GAAP Measures – Impact of Q1 Clemenger Remeasurement Gain and Repositioning Actions on Income Taxes Income Before Income Income Taxes Taxes 2011 Full Year, As Reported $ 1,549.0 $ 505.8 Adjustments: Less: Q1 Gain on Remeasurement of Equity Interest in Clemenger Group (123.4) (2.8) Plus: Q1
Slide 21: Fourth Quarter Acquisition: Mudra Group
Fourth Quarter Acquisition Mudra Group is one of India’s leading integrated marketing communications groups. Mudra’s agencies – Mudra India, DDB Mudra, Mudra MAX & Ignite Mudra – deliver brand solutions to its clients, offering a wide range of marketing services including general and specialty adver
Slide 22: Fourth Quarter Acquisition: Turkish DDB Affiliates
Fourth Quarter Acquisition DDB Worldwide has purchased a controlling interest in its two Turkish affiliates -Medina Turgul DDB and DDB & Co. Medina Turgul DDB and DDB & Co. have operated as affiliates of the DDB network since 1995 and 2004, respectively. Both agencies offer a broad range of marketin
Slide 23: Fourth Quarter Acquisition: Marina Maher Communications
Fourth Quarter Acquisition Founded in 1983 by CEO Marina Maher, Marina Maher Communications is widely recognized for its expertise in brand building for consumer products, food & beverage companies, as well as prescription and over-the-counter pharmaceuticals on behalf of Fortune 500 companies. Mari
Slide 24: Fourth Quarter Acquisition: Grid Worldwide Branding and Design
Fourth Quarter Acquisition Established in 2006, Grid Worldwide Branding and Design is a highly regarded branding and design agency. The agency services a blue chip South African client base, and was recently awarded the 2011 Design Agency of the Year in the recent AdFocus awards. Located in Johannes
Slide 25: Fourth Quarter Acquisition: Page Three Media
Fourth Quarter Acquisition Established in 2007, Page Three Media is an independent strategic media planning agency. The agency delivers high-level strategic and innovative media solutions in a “boutique” environment. With offices in Johannesburg and Cape Town, South Africa, Page Three Media will ope