| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |--------------------------------------------------------------------------------|-------|-------|-------|-------------|-------------------------------------------------------------|-------------------------------------------------------------|-------|-------------|-------| | Operating expenses: | 2023 | | | 2023 C$ (e) | 2022 | 2023 | | 2023 C$ (e) | 2022 | | Salary and related service costs | | | | | $ 1,772.0 $ 1,782.2 $ 1,800.8 $ 3,550.0 $ 3, ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2023 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 1-10551 OMNICOM GROUP INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.) ...

2023 First Quarter – 5.2% organic revenue growth First Quarter Highlights – Broad-based growth across disciplines and geographies Business update – Leading Generative AI partnership with Microsoft for integration of latest OpenAI GPT models within Omni, our data and insights platform across all Omnicom disciplines – 13.5% Non-GAAP adjusted operating income margin | --- | |----------------------------------------------------------------------| | | | – $280 million net share repurchases in the first quarter o ...

Financial Data and Key Metrics Changes - For Q1 2023, organic growth was reported at 5.2%, with adjusted operating profit margin at 13.5% and non-GAAP adjusted earnings per share at $1.56, reflecting a 12.2% increase compared to Q1 2022 [5][6][25] - Reported revenues increased by 1%, while non-GAAP adjusted operating income remained flat, negatively impacted by foreign currency translations [23][25] - Non-GAAP adjusted net income rose by 9%, with diluted share count declining by 2.5%, leading to a 12.2% increase in non-GAAP diluted EPS [25][39] Business Line Data and Key Metrics Changes - Advertising and media grew organically by 5.1%, precision marketing by 7%, commerce and brand consulting by 3.3%, experiential by 8.4%, public relations by 5.8%, and healthcare by 4.8% [27][28] - Execution and support returned to growth at 3.6%, primarily driven by merchandising and support businesses [28] Market Data and Key Metrics Changes - U.S. organic growth was 5.1%, while international organic growth was 5.4%, with positive growth across the top 10 countries except for China [32] - The Asia-Pacific region faced performance challenges, impacting overall results [32] Company Strategy and Development Direction - The company continues to invest in high-growth areas such as precision marketing, healthcare, e-commerce, and media, while also focusing on acquisitions to strengthen its portfolio [12][7] - A strategic decision was made to reduce office space by exiting over 1.6 million square feet globally, aiming for lower rent and occupancy costs in the future [14][22] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the economic environment, acknowledging potential impacts from inflation, interest rates, and geopolitical tensions [18][66] - The company remains on track to meet its full-year targets of 3% to 5% organic growth and an operating margin of 15% to 15.4% [7][43] Other Important Information - The company has established a dedicated Azure environment with Microsoft for generative AI, focusing on responsible development and ethical considerations [16][75] - Free cash flow for Q1 2023 was $429 million, up 26.3% from the previous year, with capital expenditures at $23 million [38][39] Q&A Session Summary Question: Context around organic growth guidance - Management remains comfortable with the 3% to 5% organic growth guidance, noting client caution in spending [46][47] Question: Impact of net new business wins - The L'Oréal win is expected to ramp up in Q2, with revenues starting from April 1 [55][56] Question: Competition for talent with new office policies - Management believes the return to office policy will be beneficial, with satellite offices to ease commuting challenges [57][60] Question: Mitigating macroeconomic headwinds - Management maintains a cautiously optimistic outlook, with plans to adjust operations as needed [64][66] Question: Pricing power in a higher interest rate environment - Pricing increases are being pursued, but competitive pressures exist [91]

Part I [Business](index=4&type=section&id=Item%201.%20Business) Omnicom Group Inc. is a global strategic holding company providing diverse advertising, marketing, and corporate communications services - Omnicom operates as a strategic holding company with global networks including BBDO, DDB, TBWA, and Omnicom Media Group, providing advertising, marketing, and corporate communications services[15](index=15&type=chunk) - The company's business model is client-centric, using a matrix organization structure and proprietary data and analytics platforms like Annalect and Omni to serve clients across various disciplines and geographies[18](index=18&type=chunk) - In 2022, the largest client represented **2.7% of revenue**, while the **100 largest clients accounted for approximately 53% of revenue**[23](index=23&type=chunk) - As of December 31, 2022, the company employed approximately **74,200 people worldwide**, with the largest base in the United States (**25,600 employees**)[27](index=27&type=chunk) [Risk Factors](index=7&type=section&id=Item%201A.%20Risk%20Factors) Omnicom's business is subject to various economic, operational, international, acquisition, and regulatory risks [Economic Risks](index=7&type=section&id=Economic%20Risks) Adverse economic conditions, including inflation and rising interest rates, may reduce client spending and increase media purchase risks - Adverse economic conditions, such as high inflation and rising interest rates, pose a risk of clients reducing or canceling spending, which would negatively impact revenue[31](index=31&type=chunk) - The war in Ukraine necessitated the disposal of all businesses in Russia and the suspension of operations in Ukraine during the first quarter of 2022[36](index=36&type=chunk) [Business and Operational Risks](index=8&type=section&id=Business%20and%20Operational%20Risks) Intense competition, reliance on key clients, and cybersecurity threats pose significant business and operational risks - The company's **100 largest clients represented approximately 53% of revenue in 2022**, and the loss of several of these clients could have a material adverse effect[42](index=42&type=chunk) - Omnicom relies heavily on IT systems and infrastructure, making it susceptible to cybersecurity threats like hacking and ransomware, with risks potentially increased by hybrid work arrangements[43](index=43&type=chunk)[45](index=45&type=chunk) [Risks Related to International Operations](index=9&type=section&id=Risks%20Related%20to%20International%20Operations) International operations, accounting for 48% of 2022 revenue, expose the company to currency fluctuations and geopolitical risks - In 2022, international operations accounted for approximately **48% of revenue**, exposing the company to risks from currency exchange rate fluctuations[47](index=47&type=chunk) [Risks Related to Acquisitions](index=9&type=section&id=Risks%20Related%20to%20Acquisitions) Acquisitions carry risks of unsuccessful evaluation and potential goodwill impairment charges, impacting financial results - A significant amount of goodwill is recorded on the balance sheet from acquisitions. This asset is tested for impairment annually, and a future non-cash impairment charge could have a material adverse effect on financial results[50](index=50&type=chunk) [Regulatory Risks](index=9&type=section&id=Regulatory%20Risks) Evolving regulations on privacy and ESG expectations pose risks to advertising services and company reputation - Laws and regulations concerning user privacy and internet tracking technologies could negatively affect the use of certain communication technologies as advertising media, potentially reducing demand for the company's services[53](index=53&type=chunk) - Growing expectations related to Environmental, Social, and Governance (ESG) issues expose the company to potential liabilities, reputational harm, and other business risks[54](index=54&type=chunk) [Properties](index=10&type=section&id=Item%202.%20Properties) Omnicom primarily operates from leased office spaces globally, with principal corporate offices in New York, Stamford, and West Palm Beach - Substantially all of the company's office space is leased under operating leases with varying expiration dates[56](index=56&type=chunk) [Legal Proceedings](index=10&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in various legal proceedings, none of which are expected to materially affect its financial position or operations - The company does not expect that its ongoing legal proceedings will have a material adverse effect on its results of operations or financial position[57](index=57&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=10&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Omnicom's common stock trades on the NYSE; the company repurchased approximately 1.44 million shares in Q4 2022 Issuer Purchases of Equity Securities - Q4 2022 | Period | Total Number of Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | October 1 - October 31, 2022 | 231,261 | $63.96 | | November 1 - November 30, 2022 | — | $0 | | December 1 - December 31, 2022 | 1,205,736 | $78.35 | | **Total Q4 2022** | **1,436,997** | **$76.04** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=11&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes Omnicom's financial condition and operating results for 2020-2022, covering performance, liquidity, and accounting estimates [Executive Summary](index=11&type=section&id=Executive%20Summary) The company faces ongoing global economic challenges, including a significant Q1 2022 charge from the war in Ukraine - In Q1 2022, the company recorded pretax charges of **$113.4 million** due to the war in Ukraine, primarily from the disposal of its businesses in Russia and the suspension of operations in Ukraine[63](index=63&type=chunk) - The negative impact of the COVID-19 pandemic on client spending persisted from March 2020 through the first quarter of 2021, with most markets beginning to improve in April 2021[64](index=64&type=chunk) [Results of Operations - 2022 Compared to 2021](index=19&type=section&id=Results%20of%20Operations%20-%202022%20Compared%20to%202021) In 2022, revenue was flat at **$14.29 billion**, with operating profit down **5.2%** due to a Ukraine-related charge Consolidated Results of Operations (2022 vs 2021) | Metric | 2022 | 2021 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $14,289.1M | $14,289.4M | ($0.3M) | 0.0% | | **Operating Profit** | $2,083.3M | $2,197.9M | ($114.6M) | (5.2)% | | **Operating Margin** | 14.6% | 15.4% | (0.8 p.p.) | - | | **Net Income - Omnicom** | $1,316.5M | $1,407.8M | ($91.3M) | (6.5)% | | **Diluted EPS** | $6.36 | $6.53 | ($0.17) | (2.6)% | Revenue Change Components (2022) | Component | Amount (in millions) | % of 2021 Revenue | | :--- | :--- | :--- | | **Organic Growth** | $1,346.3 | 9.4% | | **Foreign Exchange Impact** | ($681.0) | (4.8)% | | **Acquisition/Disposition, net** | ($665.6) | (4.7)% | | **Total Revenue Change** | ($0.3) | 0.0% | - The effective tax rate increased to **28.1% in 2022** from **24.6% in 2021**, primarily due to the non-deductibility of the charges related to the war in Ukraine[79](index=79&type=chunk)[120](index=120&type=chunk) [Results of Operations - 2021 Compared to 2020](index=24&type=section&id=Results%20of%20Operations%20-%202021%20Compared%20to%202020) In 2021, revenue grew **8.5%** to **$14.29 billion** with operating profit up **37.5%**, driven by strong organic growth and cost reductions Consolidated Results of Operations (2021 vs 2020) | Metric | 2021 | 2020 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $14,289.4M | $13,171.1M | $1,118.3M | 8.5% | | **Operating Profit** | $2,197.9M | $1,598.8M | $599.1M | 37.5% | | **Operating Margin** | 15.4% | 12.1% | 3.3 p.p. | - | | **Net Income - Omnicom** | $1,407.8M | $945.4M | $462.4M | 48.9% | | **Diluted EPS** | $6.53 | $4.37 | $2.16 | 49.4% | - Revenue growth in 2021 was driven by a **10.2% increase in organic growth**, a **2.2% positive impact from foreign exchange rates**, partially offset by a **3.9% reduction from net dispositions**[127](index=127&type=chunk) [Critical Accounting Estimates](index=13&type=section&id=Critical%20Accounting%20Estimates) Key accounting estimates include goodwill impairment testing and revenue recognition, requiring judgment on fair value and principal/agent roles - Goodwill impairment testing is a critical accounting estimate, performed annually at the end of Q2. The 2022 test concluded that goodwill was not impaired[86](index=86&type=chunk)[94](index=94&type=chunk) Goodwill Impairment Test Assumptions | Assumption | 2022 | 2021 | | :--- | :--- | :--- | | **Long-Term Growth Rate** | 3.5% | 3.5% | | **WACC** | 11.1% - 12.0% | 9.8% - 10.4% | - Revenue recognition requires significant judgment, particularly in determining whether the company acts as a principal (gross revenue) or an agent (net revenue) for third-party costs incurred on behalf of clients[101](index=101&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) Omnicom's liquidity relies on operations, cash, and a **$2.5 billion** credit facility; net debt increased to **$1.25 billion** in 2022 - Cash flow from operations decreased by **$1.0 billion** year-over-year to **$926.5 million in 2022**, primarily due to a decrease in cash from operating capital[143](index=143&type=chunk) Net Debt (in millions) | (in millions) | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | **Total Debt** | $5,594.1 | $5,695.3 | | **Less: Cash & Investments** | $4,342.5 | $5,316.8 | | **Net Debt** | $1,251.6 | $378.5 | - The company has a **$2.5 billion** multi-currency revolving credit facility expiring in February 2025 and was in compliance with its **3.5x Leverage Ratio covenant** at year-end 2022 (actual ratio was **2.4x**)[141](index=141&type=chunk)[156](index=156&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Omnicom manages foreign currency and interest rate risks, with international operations comprising **48% of 2022 revenue** - The company's main market risks are foreign currency exchange risk, as international operations were **48% of 2022 revenue**, and interest rate risk[162](index=162&type=chunk)[164](index=164&type=chunk) - To manage foreign exchange risk, the company uses forward foreign exchange contracts and, in 2022, entered into cross-currency swaps to hedge the net investment in its Japanese subsidiaries[165](index=165&type=chunk)[167](index=167&type=chunk) - As of December 31, 2022, the company's long-term debt portfolio consisted entirely of fixed-rate debt, mitigating exposure to rising interest rates[168](index=168&type=chunk) [Financial Statements and Supplementary Data](index=35&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section includes Omnicom's consolidated financial statements for 2020-2022, notes, and auditor reports - This item refers to the full consolidated financial statements and supplementary data, which are included from page F-1 to S-1 of the report[173](index=173&type=chunk)[186](index=186&type=chunk) [Controls and Procedures](index=35&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management and independent auditors concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2022 - Management concluded that disclosure controls and procedures were effective as of December 31, 2022[174](index=174&type=chunk) - Management concluded that internal control over financial reporting was effective as of December 31, 2022, a conclusion supported by an attestation report from the independent auditor, KPMG LLP[175](index=175&type=chunk)[176](index=176&type=chunk) Part III [Directors, Executive Compensation, and Corporate Governance](index=35&type=section&id=Items%2010-14) Information for Items 10-14, including directors, executive compensation, and security ownership, is incorporated by reference from the 2023 Proxy Statement - Information regarding directors, executive officers, corporate governance, executive compensation, security ownership, and principal accountant fees is incorporated by reference from the 2023 Proxy Statement[180](index=180&type=chunk)[181](index=181&type=chunk)[182](index=182&type=chunk) Part IV [Exhibit and Financial Statement Schedules](index=36&type=section&id=Item%2015.%20Exhibit%20and%20Financial%20Statement%20Schedules) This section lists all financial statements, schedules, and exhibits filed as part of the Annual Report on Form 10-K - This item provides a comprehensive list of all financial statements, schedules, and exhibits included in or incorporated by reference into the Form 10-K filing[186](index=186&type=chunk)

Omnicom Group Inc. (NYSE:OMC) Q4 2022 Earnings Conference Call February 7, 2023 4:30 PM ET Company Participants Gregory Lundberg - Senior Vice President, Investor Relations John Wren - Chairman & Chief Executive Officer Phil Angelastro - EVP & Chief Financial Officer Conference Call Participants Steven Cahall - Wells Fargo David Karnovsky - JPMorgan Ben Swinburne - Morgan Stanley Michael Nathanson - MoffettNathanson LLC Tim Nollen - Macquarie Research Jason Bazinet - Citigroup Craig Huber - Huber Researc ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 _________________________ Commission File Number: 1-10551 OMNICOM GROUP INC. (Exact name of registrant as specified in its charter) New York 13-1514814 (State or other jurisdiction of incorporation o ...

Omnicom Group Inc. (NYSE:OMC) Q3 2022 Earnings Conference Call October 18, 2022 4:30 PM ET Company Participants Gregory Lundberg - Senior Vice President, Investor Relations John Wren - Chairman & Chief Executive Officer Phil Angelastro - Chief Financial Officer Conference Call Participants Steven Cahall - Wells Fargo Jason Bazinet - Citigroup Inc. David Karnovsky - JPMorgan Michael Nathanson - MoffettNathanson LLC Ben Swinburne - Morgan Stanley Craig Huber - Huber Research Partners Operator Good afternoon ...

2022 Second Quarter July 19, 2022 Second Quarter Highlights Organic strength continues – 11.3% organic revenue growth – Strong across all disciplines & geographies – Precision Marketing (+21.0% organic) is now our third largest discipline, up from sixth in Q2 2019 Strategic update – Significant partnerships in retail media and ecommerce announced during the quarter with Walmart, Instacart, Amazon and Kroger – Continuing investment - across media and content - in digital transformation, MarTech, e-commerce a ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 _________________________ Commission File Number: 1-10551 OMNICOM GROUP INC. (Exact name of registrant as specified in its charter) New York 13-1514814 (State or other jurisdiction of incorporation or org ...