This picture shows the logo of the Interpublic Group of Companies (IPG) on a smartphone.
Rafael Henrique | SOPA pictures | LightRakete | Getty Images
The shares of the advertising holding Interpublic Group of Cos. rose more than 10% on Wednesday – hitting a 52-week high – after reporting gains showing the rebound in the ad market.
IPG is a holding company that owns creative, media, PR, adventure and other agencies that operate in the advertising industry. The company, like many in the advertising industry, suffered at the start of the pandemic: its stocks fell 45% from pre-pandemic levels on Feb.28, to a low of $ 11.63 on March 23.
The pandemic resulted in an immediate decline in advertising budgets in 2020, with certain areas such as travel remaining slow throughout the year. But while areas like the digital recovered quickly, more affected areas like events seem to be having a positive impact. IPG said its events and sports marketing disciplines, which were “severely affected” during the pandemic, have recovered somewhat.
“We clearly have experiences and events that show a real recovery, although not quite behind,” said CEO Philippe Krakowsky on the company’s conference call. “During the quarter, we’ve seen month-to-month consistency, so that’s something we see encouraging about going forward.”
The company reported net sales of $ 2.27 billion for the second quarter of 2021, up 22.5% from the second quarter of 2020. Executives said they believed the company would be organic as it advances further in the public health arena Can achieve growth of 9 to 10% for the full year.
Analysts from J.P. Morgan said the results are indicative of both a “robust advertising recovery” and IPG’s “premium positioning” in the marketplace. IPG competes with other large holding companies including WPP, Publicis Groupe and Omnicom Group, which also reported their profits this week.
Omnicom reported global revenue of $ 3.6 billion in the second quarter on Tuesday, up 27.5% year over year. These results reflect a “strong global macro recovery” and the collapse in advertising spending a year ago, Morgan Stanley analysts said in a statement on Wednesday.
“The robust advertising recovery continues with no concerns about the Delta variant,” said analysts at J.P. Morgan in a statement on Tuesday. “We are increasing our estimate of organic sales growth to reflect this optimism for [the second half of the year]. “
– CNBCs Michael Bloom Reporting contributed.