The trends described below do not constitute forecasts or profit estimates as defined by modified European Regulation no. 809/2004 of April 29, 2004 used in application of directive 2003/71/00 of the European Parliament and Council of November 4, 2003. The Groupe issued its outlook for 2020 when it presented its annual results on February 6, 2020.
The financial targets presented at that time confirmed the outlook issued in October 2019, namely organic growth between -2% and +1%, with an operating margin of around 17%. At that date, the coronavirus (or COVID-19) pandemic, which began in Wuhan (China) in December, did not have the importance it has taken on since then. The pandemic has caused real human tragedies, lockdown arrangements subjecting a half the global population to restrictions on their movements, including for professional reasons, and has generated an uncertain, volatile and unprecedented economic climate. As media companies have noted, it is difficult to predict reliably how advertisers’ marketing investments will react in this environment.
As such, on March 27, 2020, Publicis Groupe indicated that it would not make any comments on its guidance until further notice, while signaling that the revenue figures in the two months to end-February were in line with its 2020 business plan. It is therefore possible that the COVID-19 epidemic could have a significant effect on the activity of Publicis Groupe and its commercial partners, as well as on its operations, its main markets and as such its financial performance in 2020.
In response to the COVID-19 crisis, the Chair of the Management Board instructed the Groupe Secretary General, a member of the Management Board, to set up a dedicated management unit, which has implemented strong measures aimed at preserving the health of Groupe employees by making extensive use of telework, suspending travel in favor of videoconferencing wherever possible and encouraging employees to work from home, including in regions where the covid-19 pandemic has not really taken hold. Since the Groupe is largely endowed with the necessary tools, these measures allow continuity of service for our clients, without putting the health of our employees at risk.
At the same time, the teams have organized themselves to offer unfailing availability to our customers to help them overcome the consequences of this crisis by providing them with strategic, creative, technological and commercial support in all areas, at all times and by imagining as-needed solutions to preserve their top lines where possible.
The Group has taken steps to rigorously manage operating expenses, notably by postponing certain expenses in order to make it through the current situation. This unit meets daily, interacts daily with the Groupe’s major countries and communicates daily with local units for each of the countries in which the Groupe is present. The Groupe published its First Quarter 2020 revenue on April 13. With organic growth of –2.9%, the first quarter was in line with expectations established prior to the COVID-19 pandemic. Despite encouraging numbers in the US in the first quarter, the Groupe confirmed that it would not provide any indication on its guidance, as this would be random and volatile by nature.
The health crisis facing the world will result in a severe recession, the consequences of which are difficult to reliably predict. We could experience rebound situations but also more difficult moments. The Groupe is organized and ready for such events.
