When comparing its annual performances, Publicis Groupe measures the impact on reported net revenue of changes in foreign currency exchange rates, acquisitions and disposals, and organic growth. Organic growth, which represents the increase in like-for-like revenue at constant exchange rates, is calculated as follows:
The difference between the net revenue for the current year, after subtraction of the net revenue from acquisitions (net of that of divested activities), and the net revenue of the previous year (translated at the current exchange rate) is compared with the net revenue generated in the prior period to determine the percentage of organic growth.
The Groupe’s management believes that the analysis of organic net revenue growth provides a better understanding of its net revenue performance and trends than reported net revenue because it allows for more meaningful comparisons of current period revenue to that of prior periods. Also, like-for-like revenue is generally used in the industry as a key performance indicator.
Organic growth is unaudited and is not a measurement of performance under IFRS. It may not be comparable with similarly titled financial data of other companies.
(in millions of euros) | Total |
|---|---|
2019 net revenue | 2019 net revenue Total 9,800 |
Impact of exchange rates | Impact of exchange rates Total (219) |
2019 net revenue at 2020 exchange rates (a) | 2019 net revenue at 2020 exchange rates (a) Total 9,581 |
2020 net revenue before impact of acquisitions(1) (b) | 2020 net revenue before impact of acquisitions(1) (b) Total 8,983 |
Net revenue from acquisitions(1) | Net revenue from acquisitions(1) Total 729 |
2020 net revenue | 2020 net revenue Total 9,712 |
Organic growth (b - a) / a | Organic growth (b - a) / a Total -6.3% |
(1) Net of disposals.
Organic growth was negative at -6.3% in 2020. Growth was impacted by the Covid-19 crisis (see paragraph in Chapter 0) after a good start to the year, particularly in the United States.
Organic growth for each quarter in 2020 was:
