Omnicom Group Inc. (NYSE:OMC) Q1 2019 Earnings Conference Call Transcript

Apr 16, 2019 • 08:30 am ET

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Omnicom Group Inc. (NYSE:OMC) Q1 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good morning, ladies and gentlemen, and welcome to the Omnicom First Quarter 2019 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. (Operator Instructions) As a reminder, this conference call is being recorded. At this time, I'd like to introduce your host for today's conference, Senior Vice President of Investor Relations, Shub Mukherjee. Please go ahead.

Executive
Shub Mukherjee

Good morning. Thank you for taking the time to listen to our first quarter 2019 earnings call. On the call with me today is John Wren, President and Chief Executive Officer and Phil Angelastro, Chief Financial Officer. We hope everyone has had a chance to review our earnings release. We have posted to www.omnicomgroup.com, this morning's press release, along with the presentation covering the information that we will review this morning. This call is also being simulcast and will be archived on our website.

Before we start, I've been asked to remind everyone to read the forward-looking statements and other information that we have included at the end of our investor presentation and to point out that certain of the statements made today may constitute forward-looking statements and that these statements are our present expectations and that actual events or results may differ materially. I would also like to remind you that during the course of the call, we will discuss some non-GAAP measures, in talking about Omnicom's performance. You can find the reconciliation of those measures to the nearest comparable GAAP measures in the presentation materials.

We are going to begin this morning's call with an overview of our business from John Wren. Then, Phil Angelastro, will review our financial results for the quarter. And then, we will open up the line for your questions.

Executive
John D. Wren

Thank you, Shub. Good morning. I'm pleased to speak to you this morning about our first quarter 2019 results. It's been two months since our last call and a lot has happened in that time, including kicking off a few strategic initiatives, promotions in our agency network leadership and some notable industry awards. Importantly, we got off to a good start with our financial results. In the first quarter, organic growth was 2.5% and was in line with our internal targets. Our operating profits and EBITDA margin of 13% for the quarter exceeded our expectations. The improved performance is attributable to a number of factors, including the continuing benefits from Omnicom-wide cost initiatives, the impact of dispositions completed in 2018 and a small gain from a few additional dispositions completed in the first quarter of 2019.

The upsides were offset in part by the negative effect of foreign exchange on our operating results. Phil, will provide you more detail when he gets to his remarks. And EPS for the quarter was up 8.3% to $1.17 per share, excluding the impact of a one-time tax benefit from the successful resolution of foreign tax claims recorded in the first quarter of 2018.