Interpublic back in the red despite improving revenues
NEW YORK - Interpublic, the world's third-biggest advertising group, has posted a $21.9m (£10.5m) third-quarter loss, but chief executive Michael Roth has spoken of his 'confidence in future growth prospects'.
Announcing its third-quarter results this afternoon, the company said salary expenses and higher provision for income tax had contributed to it going $21.9m into the red, compared with the $3.7m profit it recorded in the same period last year.
Revenues at the group between July and September were up 7.5% year on year to $1.56bn, which was put down to a mixture of existing clients and new wins in advertising and public relations.
Roth, the Interpublic chief executive, said today's results "showed continued improvement in revenue growth and operating performance".
He said: "We continue to see the benefits of the financial systems and disciplines being put into place across the organisation.
"The increasingly competitive client offerings at all of our companies give us confidence in our future growth prospects."
Roth said Interpublic would continue to push for double-digit profit margins, but predicted that the 2008 margin would fall slightly short of this target at around 8.5%.
The group, the parent company to Initiative, Universal McCann and McCann Erickson, has been dogged in the past by accounting issues following an aggressive expansion strategy in the 1990s.
In 2004, it posted an annual loss of $558m, but Roth said today that the group was experiencing the benefits of "strategic actions" taken last year to put it back on an even keel.
The company's share price fell 5.8% in early trading on the New York Stock Exchange to $9.74.
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