Publicis Groupe staff in line for bonus pay after ‘record’ year for holding company

Publicis Groupe has released its full year financial results for 2021

French holding company Publicis Groupe has announced its annual results for the 2021 financial year.

The group – which owns agencies such as Saatchi & Saatchi, Zenith and Leo Burnett – ended the year on a high with organic growth pushing past pre-pandemic figures and has announced a bonus equal to at least one week’s salary to staff.

What do the results show?

  • Net revenue for the full year was €10.5bn. Revenue growth accelerated throughout the year, with Q4 seeing 13.1% revenue growth against -3.6% for the first quarter of 2021.

  • Publicis Groupe’s organic growth in the last year was 10%. Given the extraordinary demand seen by most digital agencies in 2021 amid a pandemic bounce back, double figures aren’t surprising. More telling are comparisons with performance prior to Covid; the group posted 3% organic growth against 2019.

  • The group’s operating margin and EBITDA (earnings before interest, taxes, depreciation and amortization – a commonly used measure of a net income) margin also increased. EBITDA rose from €2.15bn in 2020 to €2.31bn in 2021; its operating margin rose by €282m, representing a 17.5% rate.

  • The effects of last year’s hiring spree (it hired over 9,000 new employees in 2021) can be seen in the results. Staff costs rising to account for 62.8% of Publicis’s overall revenue, though the company spent less on restructuring activities than in previous years.

  • In its investor report, chief executive Arthur Sadoun praised the company’s commercial performance: ”2021 was a record year not just financially, but also commercially. For the third time in the past four years, we topped the new business rankings as league tables placed us well-ahead of the pack, with landmark wins including Stellantis, Walmart and Meta, to name just a few. We also started 2022 on a high note, with the win of McDonald’s US.”

Which regions and sectors performed best?

  • Sadoun picked out Epsilon and Publicis Sapient as particularly strong performers. ”Both were accretive to our full year growth, at +12.8% and +13.8% respectively, as we were in a position to capture the structural shifts in the industry towards first-party data management, digital media, commerce and business transformation.”

  • The group’s organic growth was driven by activity in North America, which saw 9% organic growth against 2019 figures. Organic growth in Asia Pacific was flat, while growth in Europe was 1% less than 2019 levels. The US alone accounted for 57% of its net revenue.

  • Reflecting trends seen earlier in 2021, Epsilon and Sapient performed strongly across most territories, while healthcare saw particular growth in the US, posting double-digit growth for the seventh quarter in a row. Healthcare clients accounted for 10.9% of the group’s 2021 revenue – an increase of 17%.

What does Publicis expect to see in 2022?

  • Publicis says it is investing more in staff by doubling its bonus pool compared to 2019 and giving a one-off bonus equal to at least a week’s salary to everyone who has worked with there for the past two years.

  • Sadoun said: ”Now, when it comes to 2022, we have three clear priorities: leveraging our unique assets in data and technology for all of our clients; giving our people more opportunity to progress, with unprecedented experiences like Work Your World; and delivering growth that is both profitable and responsible.”

  • In its presentation to investors, Publicis stated it had allotted between €400m and €600m for mergers and acquisitions over the next year, with a particular focus on data and tech capabilities.

  • Despite those ambitions, Publicis plans to cut its net debt back to €1bn.