Publicis Groupe net revenue in Q1 2020 was euro 2,481 million, a 17.1% increase from euro 2,118 million in 2019. The effects of exchange rate fluctuations had a positive impact of euro 33 million. Acquisitions (net of disposals) had a positive contribution on net revenue of euro 393 million, mainly reflecting the contribution of Epsilon and to a lesser extent that of Rauxa, partially offset by the disposals of PHS and Proximedia.
Organic growth was -2.9%, an encouraging performance due in part to the performance of the United States and despite the initial impacts of Covid-19.
Net revenue | ||||
|---|---|---|---|---|
| In millions of euros | Q1 2020 | Q1 2019 | Growth reported | Growth organic |
Europe | Europe Net revenue 578 | Europe 633 | Europe -8.7% | -9.2% |
North America | North America Net revenue 1,555 | North America 1,139 | North America +36.5% | +0.5% |
Asia Pacific | Asia Pacific Net revenue 219 | Asia Pacific 207 | Asia Pacific +5.8% | -1.9% |
Latin America | Latin America Net revenue 54 | Latin America 66 | Latin America -18.2% | -10.9% |
Middle East & Africa | Middle East & Africa Net revenue 75 | Middle East & Africa 73 | Middle East & Africa +2.7% | +0.6% |
Maturity | Maturity Net revenue 2,481 | Maturity 2,118 | Maturity +17.1% | -2.9% |
Europe posted a decline in net revenue of 8.7% and 9.2% on an organic basis. Several countries in the region had strong comparables last year, as well as experiencing a sharp drop in activity in March as the pandemic spread and containment measures were extended. France and the United Kingdom reported declines in net revenue of 12.9% and 9.6% in organic terms in the quarter. Italy and Germany recorded declines of 6.1% and 7.1% respectively.
North American net revenue rose 36.5% in the first quarter of 2020, with the contribution of Epsilon. On an organic basis, the performance was +0.5%. This includes organic growth of 0.2% in the United States, and a good performance in Canada with organic growth of 3.1%. The underlying trend is encouraging, particularly in the first two months of the year, when the creative and media sectors grew by 5% in the United States. In addition, Publicis Sapient’s performance was up slightly in the United States in the first quarter, thanks to the initial effects of its repositioning in digital business transformation. It should also be noted that Epsilon 2.0, the core of their data and tech expertise, which represents 80% of their historical business, recorded stable net revenues for the quarter, after a solid 5% increase over the first two months of the year.
Asia-Pacific posted growth of 5.8% on a reported basis and a 1.9% decrease on an organic basis. China, the country most affected by the Covid-19 pandemic for most of the first quarter, was severely affected and recorded a 15.3% decline. This negative growth was offset by a strong performance in other countries in the region, notably in India with +12.7% on an organic basis and thanks to South-East Asian countries such as Singapore and Thailand.
Latin America reported a decline of 18.2% in net revenue on a reported basis and 10.9% on an organic basis. Most of the countries in this region experienced a decline, but Brazil, with -20.5% on an organic basis, explains most of it, due to contract losses in 2019, postponements of customer campaigns and the closure of an agency in the first half of 2019.
The Middle East and Africa region recorded growth of 2.7% on a reported basis and +0.6% organically, despite a very high base in the previous year, particularly at Publicis Sapient.
As of March 31, 2020, net debt amounted to euro 4,094 million, compared to euro 2,713 million at the end of 2019 and euro 885 million at the end of March 2019. The increase is mainly due to the acquisition of Epsilon in July 2019.
The Group’s average net debt was euro 3,486 million in the first quarter of 2020, compared to euro 229 million in the first quarter of 2019.
