Omnicom Reports Fourth Quarter and Full Year 2024 Results

Core Insights - Omnicom reported a 5.2% organic revenue growth for both the fourth quarter and full year of 2024, with strong operational execution leading to confidence for continued strength in 2025 [2][9] - The company is preparing for the proposed acquisition of Interpublic, which is expected to enhance creativity, innovation, and effectiveness through expanded products and data assets [2] Fourth Quarter 2024 Results - Revenue increased by $261.3 million, or 6.4%, to $4,322.2 million compared to Q4 2023 [4][44] - Operating income rose by $38.6 million, or 6.0%, to $685.3 million, maintaining an operating income margin of 15.9% [12][44] - Net income for Q4 2024 was $448.0 million, a 5.2% increase from $425.7 million in Q4 2023, with diluted earnings per share rising to $2.26 [15][44] - Adjusted EBITA increased by $44.4 million, or 6.6%, to $722.2 million, with a margin of 16.7% [16][44] Full Year 2024 Results - Total revenue for 2024 was $15,689.1 million, up $996.9 million, or 6.8%, from 2023 [18][44] - Operating income for the year increased by $169.9 million, or 8.1%, to $2,274.6 million, with an operating income margin of 14.5% [25][44] - Net income for 2024 was $1,480.6 million, a 6.4% increase from $1,391.4 million in 2023, with diluted earnings per share rising to $7.46 [28][44] - Adjusted EBITA for the year increased by $140.8 million, or 6.1%, to $2,434.5 million, with a margin of 15.5% [29][44] Revenue Breakdown - Organic revenue growth in Q4 2024 was driven by Media & Advertising (7.1%), Precision Marketing (9.1%), and Public Relations (10.3%), while Healthcare and Branding & Retail Commerce saw declines [5][6] - For the full year, organic growth was led by Media & Advertising (7.8%) and Experiential (15.4%), with declines in Healthcare (0.4%) and Branding & Retail Commerce (6.2%) [19][20] Expense Analysis - Operating expenses for Q4 2024 increased by $222.7 million, or 6.5%, to $3,636.9 million, including $14.6 million in acquisition transaction costs related to the proposed acquisition of Interpublic [7][21] - Salary and service costs rose by $189.8 million, or 6.4%, to $3,143.8 million, reflecting organic growth in various disciplines [8][23] - For the full year, operating expenses increased by $827.0 million, or 6.6%, to $13,414.5 million, with significant contributions from salary and service costs [21][24] Interest and Taxation - Net interest expense in Q4 2024 increased by $11.3 million to $38.1 million, primarily due to higher outstanding debt [13][26] - The effective tax rate for Q4 2024 was 26.4%, slightly down from 26.5% in Q4 2023 [14][27]