Havas blames WorldCom ad freeze for revenue woes
PARIS - Havas has seen revenues drop nearly 6% to €443m (£285m) for the third quarter, a fall it blames on an advertising freeze by WorldCom, the disgraced US telecoms company.
Shares in the company, listed in Paris, fell by 4.29% this morning to trade at €4.69 after it published its results.
In a statement, the French advertising group said that organic growth had been "badly hit (around -1%) by the virtual halt in MCI WorldCom advertising expenditure during that period, after the disclosure of its accounting irregularities". However, Havas added that it should not impact on fourth-quarter revenues as WorldCom had subsequently resumed advertising.
The figure is roughly in line with expectations. Advertising operations, including Arnold Worldwide and Euro RSCG, were hardest hit by declining revenue, down 7% for the quarter ending September 30 to €174m. Geographically speaking, North America saw revenues fall by 6.9% to €202m, while Europe was down by 5.8% to €212m.
While the overall figure for non-advertising services, including media, was down by less than advertising, falling 5.3% to €269m, Havas said that its financial public relations businesses, which include the Maitland Consultancy in London and Abernathy MacGregor in New York, had seen the biggest declines in a sector breakdown.
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