Publicis Groupe SA reduced its annual sales projection after the revenue it reported over the third quarter missed analysts forecasts, as the company has been facing difficulties due to a failed merger with Omnicom Group Inc.
The companys Chief Executive Officer, Maurice Levy, said in an interview for the Wall Street Journal: “Performances don’t live up to what the market and we ourselves were expecting. We now hope for a much better 2015. (…) We are at the end of a cycle during which our attention wasn’t focused enough on taking short-term actions and on growth.” As reported by Reuters, Mr. Levy also added: “There are a number of factors behind this, mainly the fact that management was too focused on other plans and not enough on the short-term performance and growth.”
Publicis reported that its full-year organic sales excluding acquisitions are expected to be similar to the 1.5% growth, reported during the first nine months of the fiscal year. In comparison, the companys previous forecast, made in February, pointed to a 4% growth.
Publicis said that its total revenue totalled €1.7 billion ($2.1 billion) over the last three months ended September 30th. The France-based company also revealed that its organic sales excluding currency flotations, acquisitions and disposals over the period increased by only 1% due to slower growth in Europe and emerging markets.
In a statement posted in September this year, the company reaffirmed its targets until 2018 and revealed that it is not planning to present a special strategy to investors in October. Publicis has been dealing with some hard time after its $35-billion merger with Omnicom Group failed in May, as the executives failed to reach an agreement over the management of the combined company.
Publicis Groupe SA lost 3.10% to trade at €54.89 per share by 12:42 GMT, marking a one-year loss of 13.60%. The company is valued at €11.83 billion. According to the Financial Times, the 23 analysts offering 12-month price targets for Publicis Groupe SA have a median target of €65.00, with a high estimate of €75.30 and a low estimate of €52.00. The median estimate represents a 21.38% increase from the last price of €53.55.
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