(AOF) – Publicis Groupe announced the implementation of a program relating to the purchase of 2 million shares, or approximately 0.8% of its share capital as of December 31, 2023. The communications group has entrusted a mandate to an investment service provider for its implementation. This program aims to meet the obligations linked to current free share plans for the benefit of employees, without issuing new shares. This program will begin on February 9, 2024 and end no later than May 31, 2024.
At the current price, these shares represent a value of around 200 million euros which will be financed by the group’s cash.
AOF – LEARN MORE
Key points
– World number 2 in marketing, communication and digital transformation of businesses, created in 1926;
– Turnover of €12.6 billion distributed between 4 “Solutions Hub”: Publicis Communications (creative networks), Publicis Media, Publicis Sapient (digital and consulting) and Publicis Health;
– Strong position in the Americas (64% of revenues), ahead of Europe (23%) and Asia-Pacific (9%);
– Business model based on 4 strengths: dynamic, diverse and disruptive creativity under the brands Saatchi&Saatchi, Publicis, Leo Burnett…, high-performance offer in targeted media on a large scale via the brands Starcom, Zenith, Spark Foundry, data skills via Epsilon and innovative technological solutions via the Sapient platform;
– Open capital (the founding family holding 6.57% of the capital and 8.45% of the voting rights), Maurice Lévy being chairman of the 14-member supervisory board, Elisabeth Badinter vice-chairman and Arthur Sadoun chairman of the management board;
– Healthy non-debted balance sheet with €35.9 billion in equity and free self-financing of €1.7 billion.
Challenges
– Waiting for a new strategic plan after the completion of “Sprint for the future”;
– Innovation strategy focused on:
– proprietary digital channels: digital marketing, Innovation Labs, digital transformation of companies, product and service design, organization of the annual Viva Technology forum,
– Marcel artificial intelligence platform for work reorganization
– “Consume less and better” environmental strategy:
– reduction of emissions across the entire value chain: by 50% in 2030 vs. 2019 and by 90%
– net zero objective before 2040,
– open CSR Smart Data platform;
– Advances through acquisitions in the digital transformation of companies (Argentinian Practia).
Challenges
– Benefits of the partnership with Adobe in the launch of a content management platform, “PX”, reinforced by the acquisition of the North American Corra;
– Questions surrounding the impacts of artificial intelligence on the activity of advertising agencies;
– After a 7.1% increase in revenues at the end of March, 2023 objective of growth close to 5%, in turnover, an operating margin of 17.5 to 18% and a free self-financing of €1.6 billion;
– 2022 dividend of €2.9, up 21%, and share buyback.
Learn more about the Communication and Advertising sector
A global market that is doing well
According to Magna (Interpublic Group), growth in the global advertising market was limited to 1% year-on-year during the first quarter compared to a dynamic start to the year in 2022. However, for the full year, the company expects growth much superior, driven by digital. This performance is the result of China’s economic rebound since the end of the “zero Covid” policy. In the first quarter, advertising spending jumped 6% year-on-year in this country. Elsewhere, expected performances are lower for 2023: 4.2% growth in Europe (including 2.8% in France) and 2.5% in North America (4.2% if we exclude political advertisements falling without an election). The good results of the three world leaders (the French Publicis, the British WPP and the American Omnicom group) in the first quarter reflect this market development.