Publicis Q3 sales slow, optimistic for 2014

Reuters

* Organic sales growth 3.5 pct in Q3 vs 5 pct in Q2

* Sees 2013 growth of 3.5-3.6 pct, margin improvement

* Sees further improvement in organic growth in 2014

By Gwénaëlle Barzic

PARIS, Oct 16 (Reuters) - French ad group Publicis, which is merging with U.S. peer Omnicom Group, stuck to its target for higher full-year organic salesgrowth on Wednesday despite a slowdown in the third quarter onweaker emerging markets.

Publicis also forecast a further improvement in growth nextyear following the expected completion of the merger in thefirst quarter of 2014, underpinned by demand in the UnitedStates and expansion in digital advertising.

"Caution is required particularly since the global economicsituation has come under the threat of government shutdown inthe U.S.," Chief Executive Maurice Levy said. "We arenonetheless confident about 2013."

"As regards organic growth, the 2014 vintage holds greaterpromise," Publicis added.

Publicis and Omnicom unveiled plans in July to combine tocreate the world's biggest advertising group, worth some $35billion, in what they presented as a "merger of equals".

Omnicom had on Tuesday posted a higher-than-expectedquarterly net profit, driven by advertising spending in itsdomestic market where revenue rose 3.2 percent to $1.82 billion.

Publicis expects full-year organic sales growth of between3.5 and 3.6 percent, against 2.9 percent in 2012, as well as animprovement in its margin.

Market research group ZenithOptimedia, part of Publicis,last month stuck to its forecast for global ad spending to grow3.5 percent this year, indicating the market was stabilising.

Publicis said third-quarter growth slowed to 3.5 percentfrom 5 percent in the previous three months, because of atemporary slowdown in China, economic difficulties that hurtinvestment in India and underperformance in Russia. Salestotaled 1.675 billion euros ($2.3 billion).

The U.S. achieved good growth, however, with no signs so farof any impact from the partial federal shutdown, while Europeposted moderate growth for the first time this year, the companysaid.

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