IPG’s head has warned that Q1 results “cannot be indicative of the remainder of the year” as COVID-19 continues to cast an ominous shadow over adland.
The holding company reported a net revenue of $1.97 billion — a decrease of 1.6 percent from a year ago, with organic net revenue growth of 0.3 percent.
A seasonally smaller quarter brought in a net income of $4.7 million compared with a loss of $8 million a year ago.
On the investors’ call Wednesday morning, IPG Chairman and CEO Michael Roth underscored network talent at a time of great upheaval.
He said: “It goes without saying that uncertainty and anxiety as a result of the devastating COVID-19 pandemic has generated significant challenges. Our top priority continues to be the safety and well-being of our people, as well as fully supporting our clients and communities.
“It’s too early to predict the duration and extent of macroeconomic pressure on marketers and our business, but it is heartening to see that our talented workforce has proven adept and comfortable at leveraging technology and collaborating virtually to continue to work effectively.
“Unfortunately our solid results in the first quarter cannot be indicative of the remainder of the year. Our performance, however, is an indication of the competitiveness and the strength of our offerings and our people.”
Roth said that more than 95 percent of IPG’s staff are working from home, and this has not impeded the network’s ability to serve clients, generate great ideas and move the business forward.
He highlighted the confidence in leadership teams which have demonstrated that the network has the financial and management talent, tools, and business model, to successfully navigate through difficult times.
Agencies across the network have been forced to implement a number of cost-cutting measures, including staff reduction, salary cuts and furloughs.
Roth added: “Our company’s balance sheet and liquidity are strong, and were further enhanced when we proactively accessed the capital markets a few weeks ago. As always, we remain committed to the high level of transparency that you have come to expect from this team, and look forward to returning to our strong trajectory of organic revenue and profit growth once the macro situation stabilizes and a recovery begins to take hold.
“We are thankful for the continued close partnership with our clients, and proud of our employees around the world and how they have come together during these exceptional times.”