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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 17, 2023

OMNICOM GROUP INC.
(Exact Name of Registrant as Specified in its Charter)

New York
1-10551
13-1514814
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)

280 Park Avenue, New York, NY
10017
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (212) 415-3600
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol Name of each exchange on which registered
Common Stock, par value $0.15 per share OMC New York Stock Exchange
0.800% Senior Notes due 2027 OMC/27 New York Stock Exchange
1.400% Senior Notes due 2031 OMC/31 New York Stock Exchange
2.250% Senior Notes due 2033 OMC/33 New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02. Results of Operations and Financial Condition.
On October 17, 2023, Omnicom Group Inc. (“Omnicom” or the “Company”) published an earnings release reporting its financial results for the three and nine months ended September 30, 2023. A copy of the earnings release is furnished as Exhibit 99.1 to this report and is incorporated by reference herein in its entirety.
Item 7.01. Regulation FD Disclosure.
On October 17, 2023, Omnicom hosted an earnings call and posted on its website a related investor presentation in connection with publishing its financial results for the three and nine months ended September 30, 2023. A copy of the presentation is furnished as Exhibit 99.2 and is incorporated by reference herein in its entirety.
The information under Items 2.02 and 7.01 above (including Exhibits 99.1 and 99.2 hereto) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing. Additionally, the submission of the information set forth in this Item 7.01 is not deemed an admission as to the materiality of any information that is required to be disclosed solely by Regulation FD.
Forward-Looking Statements.
Certain statements in the exhibits to this Current Report on Form 8-K constitute forward-looking statements, including statements within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, from time to time, the Company or its representatives have made, or may make, forward-looking statements, orally or in writing. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial position, or otherwise, based on current beliefs of the Company’s management as well as assumptions made by, and information currently available to, the Company’s management. Forward-looking statements may be accompanied by words such as “aim,” “anticipate,” “believe,” “plan,” “could,” “should,” “would,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “will,” “possible,” “potential,” “predict,” “project” or similar words, phrases or expressions. These forward-looking statements are subject to various risks and uncertainties, many of which are outside the Company’s control. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include: adverse economic conditions, including those caused by the ongoing war in Ukraine, the lingering effects of COVID-19, high and persistent inflation in countries that comprise our major markets, rising interest rates, and supply chain issues affecting the distribution of our clients’ products; international, national or local economic conditions that could adversely affect the Company or its clients; losses on media purchases and production costs incurred on behalf of clients; reductions in client spending, a slowdown in client payments and a deterioration or a disruption in the credit markets; the ability to attract new clients and retain existing clients in the manner anticipated; changes in client advertising, marketing and corporate communications requirements; failure to manage potential conflicts of interest between or among clients; unanticipated changes related to competitive factors in the advertising, marketing and corporate communications industries; the ability to hire and retain key personnel; currency exchange rate fluctuations; reliance on information technology systems; changes in legislation or governmental regulations affecting the Company or its clients; risks associated with assumptions the Company makes in connection with its critical accounting estimates and legal proceedings; the Company’s international operations, which are subject to the risks of currency repatriation restrictions, social or political conditions and regulatory environment; effectively managing the risks, challenges and efficiencies presented by utilizing Artificial Intelligence (AI) technologies and partnerships in our business; and risks related to our environmental, social and governance goals and initiatives, including impacts from regulators and other stakeholders, and the impact of factors outside of our control on such goals and initiatives. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties that may affect the Company’s business, including those described in Item 1A, “Risk Factors” and Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022 and in other documents filed from time to time with the Securities and Exchange Commission. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.




Exhibit Number Description
99.1
99.2
104 The cover page from this Current Report on Form 8-K, formatted in Inline XBRL



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Omnicom Group Inc.
 
By: /s/ Andrew L. Castellaneta
Name: Andrew L. Castellaneta
Title:
Senior Vice President,
Chief Accounting Officer
Date: October 17, 2023

EX-99.1 2 a2023q3earningsrelease.htm EX-99.1 Document

omnicomlogobluetransparenta.jpg

OMNICOM REPORTS THIRD QUARTER 2023 RESULTS

Revenue of $3,578.1 million, with organic growth of 3.3%
Operating income of $560.8 million
Operating income margin of 15.7%
Diluted earnings per share of $1.86

NEW YORK, October 17, 2023 - Omnicom (NYSE: OMC) today announced results for the quarter ended September 30, 2023.

"We are pleased with our strong organic revenue growth of 3.3%, with notable performances in our Advertising & Media, Precision Marketing, and Healthcare disciplines. Our year-to-date organic growth of 4.0% remains in line with our full-year expectations, which reflects the resiliency of our business even in periods of economic uncertainty,” said John Wren, Chairman and Chief Executive Officer of Omnicom. “Omnicom continued to post strong profitability and earnings growth in the quarter, and our recent business wins validate the benefits of our client strategy in this rapidly evolving marketplace. We are very well positioned for a recovery in business conditions, with a strong balance sheet and leading creativity in all of our service disciplines."

Third Quarter 2023 Results

Three Months Ended September 30,
$ in millions, except per share amounts 2023 2022
Revenue $ 3,578.1  $ 3,443.4 
Operating Income 560.8  546.0 
Operating Income Margin 15.7  % 15.9  %
Net Income 1
371.9  364.5 
Net Income per Share - Diluted 1
$ 1.86  $ 1.77 
EBITA2
581.1  566.1 
EBITA Margin2
16.2  % 16.4  %
Notes: 1) Net Income and Net Income per Share for Omnicom Group Inc.; 2) See non-GAAP reconciliations starting on page 9.

Revenues
Reported revenue in the third quarter of 2023 increased $134.7 million, or 3.9%, to $3,578.1 million.
Worldwide revenue growth in the third quarter of 2023 compared to the third quarter of 2022 was led by an increase in organic growth of $113.1 million, or 3.3%. The impact of foreign currency translation increased revenue by $59.1 million, or 1.7%. Acquisition revenue, net of disposition revenue, reduced revenue by $37.5 million, or 1.1%, primarily due to dispositions earlier in the year in the Execution & Support discipline, partially offset by acquisitions in the third quarter of 2023 in the Advertising & Media and Public Relations disciplines.

280 Park Avenue, New York, NY 10017. Tel (212) 415-3672


Organic growth by discipline in the third quarter of 2023 compared to the third quarter of 2022 was as follows: 6.1% for Advertising & Media, 4.3% for Precision Marketing, 3.8% for Healthcare, and 9.2% for Experiential. Organic decline by discipline was as follows: 5.5% for Public Relations, 3.6% for Execution & Support, and 1.7% for Commerce & Branding.

Organic growth by region in the third quarter of 2023 compared to the third quarter of 2022 was as follows: 2.7% for the United States, 5.7% for Euro Markets & Other Europe, 4.4% for the United Kingdom, 19.2% for Latin America, and 2.5% for Asia Pacific. Organic decline by region was as follows: 10.8% for the Middle East & Africa, and 1.7% for Other North America.

Expenses
Operating expenses increased $119.9 million, or 4.1%, to $3,017.3 million in the third quarter of 2023 compared to the third quarter of 2022.

Salary and service costs, which tend to fluctuate with changes in revenue, are comprised of salary and related costs, third-party service costs, and third-party incidental costs. Salary and service costs include employee compensation and benefits costs and freelance labor. Salary and service costs increased $110.4 million, or 4.5%, to $2,586.5 million. Salary and related costs increased $7.6 million, or 0.4%, to $1,756.7 million, primarily due to an increase in headcount as a result of organic growth and acquisitions. Third-party service costs include third-party supplier costs when we act as principal in providing services to our clients. Third-party incidental costs primarily consist of client-related travel and incidental out-of-pocket costs that we bill back to the client directly at our cost and which we are required to include in revenue. Third-party service costs increased $90.6 million, or 15.4%, to $678.8 million as a result of organic growth, and third-party incidental costs increased $12.2 million, or 8.8%, to $151.0 million.

Occupancy and other costs, which are less directly linked to changes in revenue than salary and service costs, increased $7.6 million, or 2.7%, to $288.6 million, due to increases in other occupancy expenses, partially offset by lower rent.

SG&A expenses increased $3.4 million, or 3.9%, to $89.8 million, primarily due to higher professional fees related to acquisitions.

Operating Income
Operating income increased $14.8 million, or 2.7%, to $560.8 million in the third quarter of 2023 compared to the third quarter of 2022. The related operating income margin was 15.7% compared to 15.9% for the third quarter of 2022.

Interest Expense, net
Net interest expense in the third quarter of 2023 increased $9.2 million to $38.3 million compared to the third quarter of 2022. Interest expense increased $1.5 million to $53.5 million, and interest income decreased $7.7 million to $15.2 million primarily due to lower cash and short term investment balances.

Income Taxes
Our effective tax rate of 26% in the third quarter of 2023 was flat with the rate in the third quarter of 2022.

Net Income – Omnicom Group Inc. and Diluted Net Income per Share
Net income - Omnicom Group Inc. for the third quarter of 2023 increased $7.4 million, or 2.0%, to $371.9 million compared to the third quarter of 2022. Diluted shares outstanding for the third quarter of 2023 decreased 3.1% to 199.9 million from 206.3 million in the third quarter of 2022 as a result of net share repurchases. Diluted net income per share of $1.86 increased $0.09, or 5.1%, from $1.77 per share.

Page 2


EBITA
EBITA increased $15.0 million, or 2.6%, to $581.1 million in the third quarter of 2023 compared to the third quarter of 2022. The related EBITA margin was 16.2% compared to 16.4% for the third quarter of 2022.

Risks and Uncertainties
Current global economic challenges, including the war in Ukraine, high and sustained inflation, rising interest rates, supply chain disruptions, credit market deterioration, and other macroeconomic factors, could cause economic uncertainty and volatility. The impact of these issues on our business will vary by geographic market and discipline. We closely monitor economic conditions, client revenue levels and other factors. In response to reductions in revenue, we can take actions to align our cost structure with changes in client demand and manage our working capital. However, there can be no assurance as to the effectiveness of our efforts to mitigate any impact of the current and future adverse economic conditions, reductions in client revenue, changes in client creditworthiness, and other developments.

Definitions - Components of Revenue Change
We use certain terms in describing the components of the change in revenue above.

Foreign exchange rate impact: calculated by translating the current period’s local currency revenue using the prior period average exchange rates to derive current period constant currency revenue. The foreign exchange rate impact is the difference between the current period revenue in U.S. Dollars and the current period constant currency revenue.

Acquisition revenue, net of disposition revenue: Acquisition revenue is calculated as if the acquisition occurred twelve months prior to the acquisition date by aggregating the comparable prior period revenue of acquisitions through the acquisition date. As a result, acquisition revenue excludes the positive or negative difference between our current period revenue subsequent to the acquisition date and the comparable prior period revenue and the positive or negative growth after the acquisition date is attributed to organic growth. Disposition revenue is calculated as if the disposition occurred twelve months prior to the disposition date by aggregating the comparable prior period revenue of disposals through the disposition date. The acquisition revenue and disposition revenue amounts are netted in the description above.

Organic growth: calculated by subtracting the foreign exchange rate impact component and the acquisition revenue, net of disposition revenue component from total revenue growth.

Conference Call
Omnicom will host a conference call to review its financial results on Tuesday, October 17, 2023 at 4:30 p.m. Eastern Time. Participants can listen to the conference call by calling 844-291-5494 (domestic) or 409-207-6995 (international), along with access code 4961768. The call will also be simulcast and archived on our investor relations website.

Corporate Responsibility
At Omnicom, we are committed to promoting responsible practices and making positive contributions to society around the globe. Please explore our website (omnicomgroup.com/corporate-responsibility) for highlights of our progress across the areas on which we focus: Empower People, Protect Our Planet, Lead Responsibly.






Page 3


About Omnicom
Omnicom (www.omnicomgroup.com) is a leading global marketing and corporate communications company. Omnicom’s branded networks and numerous specialty firms offer services in advertising, strategic media planning and buying, precision marketing, commerce and branding, experiential, customer relationship marketing (CRM), public relations, healthcare marketing and other specialty communications services to over 5,000 clients in more than 70 countries.    

Contact
Investors: Gregory Lundberg greg.lundberg@omnicomgroup.com
Media: Joanne Trout joanne.trout@omnicomgroup.com

Non-GAAP Financial Measures
We present financial measures determined in accordance with generally accepted accounting principles in the United States (“GAAP”) and adjustments to the GAAP presentation (“Non-GAAP”), which we believe are meaningful for understanding our performance. EBITA is defined as operating income before interest, taxes, and amortization of intangible assets, and EBITA margin is defined as EBITA divided by revenue. We use EBITA and EBITA margin as additional operating performance measures, which exclude the non-cash amortization expense of intangible assets (primarily consisting of amortization arising from acquisitions). We also use Adjusted Operating Income, Adjusted Operating Income Margin, Adjusted EBITA, Adjusted EBITA Margin, Adjusted Income Tax Expense, Adjusted Net Income – Omnicom Group Inc. and Adjusted Net Income per diluted share – Omnicom Group Inc. as additional operating performance measures. We believe these measures are useful in evaluating the impact of certain items on operating performance and allow for comparability between reporting periods. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in accordance with GAAP. Non-GAAP financial measures as reported by us may not be comparable to similarly titled amounts reported by other companies.

Forward-Looking Statements Certain statements in this press release constitute forward-looking statements, including statements within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, from time to time, the Company or its representatives have made, or may make, forward-looking statements, orally or in writing. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial position, or otherwise, based on current beliefs of the Company’s management as well as assumptions made by, and information currently available to, the Company’s management. Forward-looking statements may be accompanied by words such as “aim,” “anticipate,” “believe,” “plan,” “could,” “should,” “would,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “will,” “possible,” “potential,” “predict,” “project” or similar words, phrases or expressions. These forward-looking statements are subject to various risks and uncertainties, many of which are outside the Company’s control. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include: adverse economic conditions, including those caused by the war in Ukraine, the lingering effects of the COVID-19 pandemic, high and persistent inflation in countries that comprise our major markets, rising interest rates, and supply chain issues affecting the distribution of our clients’ products; international, national or local economic conditions that could adversely affect the Company or its clients; losses on media purchases and production costs incurred on behalf of clients; reductions in client spending, a slowdown in client payments and a deterioration or a disruption in the credit markets; the ability to attract new clients and retain existing clients in the manner anticipated; changes in client advertising, marketing and corporate communications requirements; failure to manage potential conflicts of interest between or among clients; unanticipated changes related to competitive factors in the advertising, marketing and corporate communications industries; the ability to hire and retain key personnel; currency exchange rate fluctuations; reliance on information technology systems; changes in legislation or governmental regulations affecting the Company or its clients; risks associated with assumptions the Company makes in connection with its critical accounting estimates and legal proceedings; and the Company’s international operations, which are subject to the risks of currency repatriation restrictions, social or political conditions and regulatory environment;effectively managing the risks, challenges and efficiencies presented by utilizing Artificial Intelligence (AI) technologies and partnerships in our business; and risks related to our environmental, social and governance goals and initiatives, including impacts from regulators and other stakeholders, and the impact of factors outside of our control on such goals and initiatives.
Page 4


The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties that may affect the Company’s business, including those described in Item 1A, “Risk Factors” and Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements.
Page 5


OMNICOM GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In millions, except per share amounts)

Three Months Ended 
September 30,
2023 2022
Revenue $ 3,578.1  $ 3,443.4 
Operating Expenses:
Salary and service costs 2,586.5  2,476.1 
Occupancy and other costs 288.6  281.0 
Cost of services 2,875.1  2,757.1 
Selling, general and administrative expenses 89.8  86.4 
Depreciation and amortization 52.4  53.9 
Total operating expenses 3,017.3  2,897.4 
Operating Income 560.8  546.0 
Interest Expense 53.5  52.0 
Interest Income 15.2  22.9 
Income Before Income Taxes and Income From Equity Method Investments 522.5  516.9 
Income Tax Expense 136.1  134.7 
Income From Equity Method Investments 1.9  1.1 
Net Income 388.3  383.3 
Net Income Attributed To Noncontrolling Interests 16.4  18.8 
Net Income - Omnicom Group Inc. $ 371.9  $ 364.5 
Net Income Per Share - Omnicom Group Inc.:
Basic $ 1.88  $ 1.78 
Diluted $ 1.86  $ 1.77 
Revenue $ 3,578.1  $ 3,443.4 
Operating Margin % 15.7  % 15.9  %
EBITA $ 581.1  $ 566.1 
EBITA Margin % 16.2  % 16.4  %
Dividends Declared Per Common Share $ 0.70  $ 0.70 






















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OMNICOM GROUP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In millions, except per share amounts)

Nine Months Ended 
September 30,
2023 2022
Revenue $ 10,631.3  $ 10,420.9 
Operating Expenses:
Salary and service costs 7,747.2  7,533.9 
Occupancy and other costs 877.9  874.2 
Real estate and other repositioning costs1,2
191.5  — 
Charges arising from the effects of the war in Ukraine2
—  113.4 
Gain on disposition of subsidiary1
(78.8) — 
Cost of services 8,737.8  8,521.5 
Selling, general and administrative expenses 278.1  294.0 
Depreciation and amortization 157.4  164.8 
Total operating expenses 9,173.3  8,980.3 
Operating Income 1,458.0  1,440.6 
Interest Expense 165.9  154.2 
Interest Income 80.9  42.2 
Income Before Income Taxes and Income From Equity Method Investments 1,373.0  1,328.6 
Income Tax Expense1,2
360.7  383.3 
Income From Equity Method Investments 3.1  2.6 
Net Income1,2
1,015.4  947.9 
Net Income Attributed To Noncontrolling Interests 49.7  61.2 
Net Income - Omnicom Group Inc.1,2
$ 965.7  $ 886.7 
Net Income Per Share - Omnicom Group Inc.:
Basic $ 4.84  $ 4.30 
Diluted1,2
$ 4.78  $ 4.27 
Revenue $ 10,631.3  $ 10,420.9 
Operating Margin % 13.7  % 13.8  %
EBITA $ 1,516.9  $ 1,500.9 
EBITA Margin % 14.3  % 14.4  %
Dividends Declared Per Common Share $ 2.10  $ 2.10 


(1) For the nine months ended September 30, 2023, operating expenses included real estate operating lease impairment charges, severance, and other exit costs related to repositioning actions we took in the first and second quarters of 2023 to reduce our real estate requirements, rebalance our workforce, and consolidate operations in certain markets. In addition, in the second quarter of 2023, we recorded a gain on disposition of certain of our research businesses in the Execution & Support discipline. The net aggregate impact to Operating Income for the nine months ended September 30, 2023 was a reduction of $112.7 million ($89.6 million after tax). The net aggregate effect of these items in the nine months ended September 30, 2023 to diluted net income per share - Omnicom Group Inc. was a decrease of $0.44.

(2) For the nine months ended September 30, 2022, operating expenses included $113.4 million of charges recorded in the first quarter of 2022 as well as an additional net income tax charge of $4.8 million related to the disposition of our businesses in Russia, which reduced net income - Omnicom Group Inc. by $118.2 million and diluted net income per share - Omnicom Group Inc. by $0.57.




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OMNICOM GROUP INC. AND SUBSIDIARIES
DETAIL OF OPERATING EXPENSES
(Unaudited)
(In millions)
Three Months Ended 
September 30,
2023 2022
Revenue $ 3,578.1  $ 3,443.4 
Operating Expenses:
Salary and service costs:
Salary and related costs 1,756.7  1,749.1 
Third-party service costs1
678.8  588.2 
Third-party incidental costs2
151.0  138.8 
Total salary and service costs 2,586.5  2,476.1 
Occupancy and other costs 288.6  281.0 
    Cost of services 2,875.1  2,757.1 
Selling, general and administrative expenses 89.8  86.4 
Depreciation and amortization 52.4  53.9 
Total operating expenses 3,017.3  2,897.4 
Operating Income $ 560.8  $ 546.0 



Nine Months Ended 
September 30,
2023 2022
Revenue $ 10,631.3  $ 10,420.9 
Operating Expenses:
Salary and service costs:
Salary and related costs 5,306.7  5,344.5 
Third-party service costs1
2,033.9  1,799.0 
Third-party incidental costs2
406.6  390.4 
Total salary and service costs 7,747.2  7,533.9 
Occupancy and other costs 877.9  874.2 
Real estate and other repositioning costs 191.5  — 
Charges arising from the effects of the war in Ukraine —  113.4 
Gain on disposition of subsidiary (78.8) — 
    Cost of services 8,737.8  8,521.5 
Selling, general and administrative expenses 278.1  294.0 
Depreciation and amortization 157.4  164.8 
Total operating expenses 9,173.3  8,980.3 
Operating Income $ 1,458.0  $ 1,440.6 
(1) Third-party service costs include third-party supplier costs when we act as principal in providing services to our clients.
(2) Third-party incidental costs primarily consist of client-related travel and incidental out-of-pocket costs which we bill back to the
client directly at our cost and which we are required to include in revenue.







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OMNICOM GROUP INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Unaudited)
(In millions)
Three Months Ended 
September 30,
Nine Months Ended 
September 30,
2023 2022 2023 2022
Net Income - Omnicom Group Inc. $ 371.9  $ 364.5  $ 965.7  $ 886.7 
Net Income Attributed To Noncontrolling Interests 16.4  18.8  49.7  61.2 
Net Income 388.3  383.3  1,015.4  947.9 
Income From Equity Method Investments 1.9  1.1  3.1  2.6 
Income Tax Expense 136.1  134.7  360.7  383.3 
Income Before Income Taxes and Income From Equity Method Investments 522.5  516.9  1,373.0  1,328.6 
Interest Expense 53.5  52.0  165.9  154.2 
Interest Income 15.2  22.9  80.9  42.2 
Operating Income 560.8  546.0  1,458.0  1,440.6 
Add back: Amortization of intangible assets 20.3  20.1  58.9  60.3 
Earnings before interest, taxes and amortization of intangible assets (“EBITA”) $ 581.1  $ 566.1  $ 1,516.9  $ 1,500.9 
Real estate and other repositioning costs —  —  191.5  — 
Charges arising from the effects of the war in Ukraine —  —  —  113.4 
Gain on disposition of subsidiary —  —  (78.8) — 
EBITA - Adjusted $ 581.1  $ 566.1  $ 1,629.6  $ 1,614.3 
Revenue $ 3,578.1  $ 3,443.4  $ 10,631.3  $ 10,420.9 
EBITA $ 581.1  $ 566.1  $ 1,516.9  $ 1,500.9 
EBITA Margin % 16.2  % 16.4  % 14.3  % 14.4  %
EBITA - Adjusted $ 581.1  $ 566.1  $ 1,629.6  $ 1,614.3 
EBITA Margin % - Adjusted 16.2  % 16.4  % 15.3  % 15.5  %
The above table reconciles the U.S. GAAP financial measure of Net Income - Omnicom Group Inc. to EBITA (defined as earnings before interest, taxes and amortization of intangible assets) and EBITA Margin (defined as EBITA divided by revenue) for the periods presented. The above table also presents non-GAAP adjustments to EBITA to present EBITA- Adjusted for the periods presented. We use EBITA and EBITA Margin as additional operating performance measures, which exclude the non-cash amortization expense of intangible assets (primarily consisting of amortization of intangible assets arising from acquisitions). Accordingly, we believe EBITA and EBITA Margin are useful measures for investors to evaluate the performance of our business.
















Page 9


OMNICOM GROUP INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Unaudited)
(In millions)

Three Months Ended September 30,
Reported 2023 Non-GAAP Adj. Non-GAAP 2023 Adj. Reported 2022 Non-GAAP Adj. Non-GAAP 2022 Adj.
Revenue $3,578.1 $ —  $ 3,578.1  $ 3,443.4  $ —  $ 3,443.4 
Operating Expenses 3,017.3  —  3,017.3  2,897.4  —  2,897.4 
Operating Income 560.8  —  560.8  546.0  —  546.0 
Operating Income Margin % 15.7  % 15.7  % 15.9  % 15.9  %
Add back: Amortization of intangible assets 20.3  —  20.3  20.1  —  20.1 
EBITA1
$ 581.1  $ —  $ 581.1  $ 566.1  $ —  $ 566.1 
EBITA Margin %1
16.2  % 16.2  % 16.4  % 16.4  %

Nine Months Ended September 30,
Reported 2023
Non-GAAP Adj. (2)
Non-GAAP 2023 Adj. Reported 2022
Non-GAAP Adj. (2)
Non-GAAP 2022 Adj.
Revenue $10,631.3 $ —  $ 10,631.3  $ 10,420.9  $ —  $ 10,420.9 
Operating Expenses2
9,173.3  (112.7) 9,060.6  8,980.3  (113.4) 8,866.9 
Operating Income 1,458.0  112.7  1,570.7  1,440.6  113.4  1,554.0 
Operating Income Margin % 13.7  % 14.8  % 13.8  % 14.9  %
Add back: Amortization of intangible assets 58.9  —  58.9  60.3  —  60.3 
EBITA1
$ 1,516.9  $ 112.7  $ 1,629.6  $ 1,500.9  $ 113.4  $ 1,614.3 
EBITA Margin %1
14.3  % 15.3  % 14.4  % 15.5  %

(1)     See Non-GAAP reconciliation on page 9.
(2)    For the nine months ended September 30, 2023, operating expenses included real estate operating lease impairment charges, severance, and other exit costs related to repositioning actions we took in the first and second quarters of 2023 to reduce our real estate requirements, rebalance our workforce, and consolidate operations in certain markets. In addition, in the second quarter of 2023, we recorded a gain on disposition of certain of our research businesses in the Execution & Support discipline. There was no impact to Operating Income for the three months ended September 30, 2023 from this disposition. The net aggregate impact to Operating Income for the nine months ended September 30, 2023 was a reduction of $112.7 million ($89.6 million after tax). The net aggregate effect of these items in the nine months ended September 30, 2023 to diluted net income per share - Omnicom Group Inc. was a decrease of $0.44.
For the nine months ended September 30, 2022, operating expenses included $113.4 million of charges recorded in the first quarter of 2022 as well as an additional net income tax charge of $4.8 million related to the disposition of our businesses in Russia, which reduced net income - Omnicom Group Inc. by $118.2 million and diluted net income per share - Omnicom Group Inc. by $0.57.




Page 10


OMNICOM GROUP INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Unaudited)
(In millions, except per share amounts)

Three Months Ended September 30, Nine Months Ended September 30,
2023 2022 2023 2022
Operating Income - Reported $ 560.8  $ 546.0  $ 1,458.0  $ 1,440.6 
Real estate and other repositioning costs —  —  191.5  — 
Charges arising from the effects of the war in Ukraine —  —  —  113.4 
Gain on disposition of subsidiary —  —  (78.8) — 
Non-GAAP Operating Income - Adjusted $ 560.8  $ 546.0  $ 1,570.7  $ 1,554.0 

Three Months Ended September 30, Nine Months Ended September 30,
2023 2022 2023 2022
Income Tax Expense - Reported $ 136.1  $ 134.7  $ 360.7  $ 383.3 
Income tax expense related to:
Real estate and other repositioning costs —  —  46.0  — 
Charges arising from the effects of the war in Ukraine —  —  —  (4.8)
Gain on disposition of subsidiary —  —  (22.9) — 
Non-GAAP Income Tax Expense- Adjusted $ 136.1  $ 134.7  $ 383.8  $ 378.5 

Three Months Ended September 30, Nine Months Ended September 30,
2023 2022 2023 2022
Net Income Net Income per Share- Diluted Net Income Net Income per Share- Diluted Net Income Net Income per Share- Diluted Net Income Net Income per Share- Diluted
Net Income - Omnicom Group Inc. - Reported $ 371.9  $ 1.86  $ 364.5  $ 1.77  $ 965.7  $ 4.78  $ 886.7  $ 4.27 
Real estate and other repositioning costs —  —  —  —  145.5  0.72  —  — 
Charges arising from the effects of the war in Ukraine —  —  —  —  —  —  118.2  0.57 
Gain on disposition of subsidiary —  —  —  —  (55.9) (0.28) —  — 
Non-GAAP Net Income - Omnicom Group Inc. - Adjusted1
$ 371.9  $ 1.86  $ 364.5  $ 1.77  $ 1,055.3  $ 5.22  $ 1,004.9  $ 4.84 

(1)     Diluted Shares for the three months ended September 30, 2023 and 2022 in millions were 199.9 and 206.3, respectively. Diluted Shares for the nine months ended September 30, 2023 and 2022 in millions were 202.0 and 207.6, respectively.
The above tables reconcile GAAP financial measures of Operating Income, Income Tax Expense, and Net Income-Omnicom Group Inc., to adjusted Non-GAAP financial measures of Non-GAAP Operating Income - Adjusted, Non-GAAP Income Tax Expense - Adjusted, and Non-GAAP Net Income-Omnicom Group Inc.-Adjusted for the periods presented. Management believes excluding the charges arising from the effects of the war in Ukraine, partially offset by a gain on the disposition of a subsidiary, and repositioning costs provides investors with a better picture of the performance of the business during the periods presented.
Page 11
EX-99.2 3 a2023q3investorpresentat.htm EX-99.2 a2023q3investorpresentat
2023 Third Quarter October 17, 2023


 
2 Third Quarter Highlights Revenue – 3.3% organic revenue growth in Q3 2023, 4.0% YTD, in line with full-year expectations – Strong organic growth rates in Advertising & Media, Precision Marketing, and Healthcare disciplines Income – 15.7% operating income margin – 16.2% EBITA margin – 5.1% growth in Q3 diluted EPS, 7.9% growth YTD Non-GAAP adjusted diluted EPS Business update – New business momentum with recent announcements of Uber, HSBC, Beiersdorf, Novartis, Under Armour, Amazon, Telstra – Omni's adoption of generative AI capabilities through Omni Assist is already delivering enhanced value Capital allocation – Completed four acquisitions in Q3 in Advertising & Media and Public Relations disciplines – 46.7% Return on Equity and 22.6% Return on Invested Capital for the 12 months ended September 30, 2023 (i) See Non-GAAP reconciliations on pages 18 - 21. (i)


 
3 Third Quarter Year to Date 2023 2022 2023 2022 Revenue $ 3,578.1 $ 3,443.4 $ 10,631.3 $ 10,420.9 Operating Expenses (a) 3,017.3 2,897.4 9,173.3 8,980.3 Operating Income 560.8 546.0 1,458.0 1,440.6 Net Interest Expense 38.3 29.1 85.0 112.0 Income Tax Expense(b) 136.1 134.7 360.7 383.3 Income from Equity Method Investments 1.9 1.1 3.1 2.6 Net Income Attributed to Noncontrolling Interests 16.4 18.8 49.7 61.2 Net Income - Omnicom Group Inc.(a)(b) $ 371.9 $ 364.5 $ 965.7 $ 886.7 Diluted Shares 199.9 206.3 202.0 207.6 Net Income per Share - Diluted(a)(b) $ 1.86 $ 1.77 $ 4.78 $ 4.27 Dividends Declared Per Common Share $ 0.70 $ 0.70 $ 2.10 $ 2.10 Income Statement Summary In millions except per share amounts. See Notes on page 13.


 
4 Revenue Change Third Quarter Year to Date $ % ∆ $ % ∆ Prior Period Revenue $ 3,443.4 $ 10,420.9 Foreign exchange rate impact(1) 59.1 1.7 % (75.3) (0.7) % Acquisition revenue, net of disposition revenue(2) (37.5) (1.1) % (127.5) (1.2) % Organic growth(3) 113.1 3.3 % 413.2 4.0 % Current Period Revenue $ 3,578.1 3.9 % $ 10,631.3 2.0 % In millions. See Definitions on page 13.


 
5 Revenue by Discipline Third Quarter Revenue % of Rev % Growth % Organic Growth(3) Advertising & Media $ 1,909.2 53.4 % 8.2 % 6.1 % Precision Marketing 383.7 10.7 % 5.6 % 4.3 % Commerce & Branding 211.6 5.9 % (0.1) % (1.7) % Experiential 133.3 3.7 % 10.5 % 9.2 % Execution & Support 206.1 5.8 % (21.3) % (3.6) % Public Relations 392.4 11.0 % (0.2) % (5.5) % Healthcare 341.8 9.6 % 4.3 % 3.8 % Total $ 3,578.1 100.0 % 3.9 % 3.3 % Year to Date Revenue % of Rev % Growth % Organic Growth(3) Advertising & Media $ 5,597.2 52.6 % 4.2 % 5.4 % Precision Marketing 1,112.7 10.5 % 4.3 % 4.5 % Commerce & Branding 631.7 5.9 % 0.2 % 1.3 % Experiential 445.5 4.2 % 8.1 % 8.9 % Execution & Support 673.2 6.3 % (17.0) % (1.2) % Public Relations 1,161.5 10.9 % 1.1 % — % Healthcare 1,009.5 9.6 % 2.8 % 3.8 % Total $ 10,631.3 100.0 % 2.0 % 4.0 % In millions. See Definitions on page 13.


 
6 Third Quarter Revenue % of Rev % Growth % Organic Growth(3) United States $ 1,868.8 52.2 % 1.1 % 2.7 % Other North America 114.4 3.2 % (5.6) % (1.7) % United Kingdom 407.1 11.4 % 10.5 % 4.4 % Euro Markets & Other Europe 609.7 17.1 % 12.9 % 5.7 % Asia Pacific 427.1 11.9 % — % 2.5 % Latin America 99.4 2.8 % 28.6 % 19.2 % Middle East & Africa 51.6 1.4 % (16.8) % (10.8) % Total $ 3,578.1 100.0 % 3.9 % 3.3 % Revenue by Region Year to Date Revenue % of Rev % Growth % Organic Growth(3) United States $ 5,531.6 52.0 % 2.1 % 3.3 % Other North America 357.2 3.4 % (1.4) % 4.4 % United Kingdom 1,163.7 10.9 % 1.8 % 4.3 % Euro Markets & Other Europe 1,850.6 17.4 % 3.9 % 4.5 % Asia Pacific 1,271.1 12.0 % (1.1) % 4.3 % Latin America 258.0 2.4 % 14.7 % 12.7 % Middle East & Africa 199.1 1.9 % (4.6) % 1.8 % Total $ 10,631.3 100.0 % 2.0 % 4.0 % In millions. See Definitions on page 13.


 
7 Nine Months Ended September 30 2023 2022 Pharmaceuticals and Healthcare 16% 16% Food and Beverage 15% 14% Auto 12% 10% Technology 8% 11% Consumer Products 8% 8% Financial Services 8% 7% Travel & Entertainment 7% 7% Retail 6% 6% Telecommunications 4% 5% Government 4% 3% Services 2% 2% Oil, Gas & Utilities 2% 2% Education 1% 1% Not-for-Profit 1% 1% Other 6% 7% Total 100% 100% Revenue by Industry Sector Note: Prior year period amounts conform to the current period presentation.


 
8 Operating Expense Detail Third Quarter Year to Date 2023 % of Rev 2022 % of Rev 2023 % of Rev 2022 % of Rev Revenue $ 3,578.1 $ 3,443.4 $ 10,631.3 $ 10,420.9 Operating expenses: Salary and related service costs 1,756.7 49.1 % 1,749.1 50.8 % 5,306.7 49.9 % 5,344.5 51.3 % Third-party service costs(c) 678.8 19.0 % 588.2 17.1 % 2,033.9 19.1 % 1,799.0 17.3 % Third-party incidental costs(d) 151.0 4.2 % 138.8 4.0 % 406.6 3.8 % 390.4 3.7 % Total salary and service costs 2,586.5 2,476.1 7,747.2 7,533.9 Occupancy and other costs 288.6 8.1 % 281.0 8.2 % 877.9 8.3 % 874.2 8.4 % Repositioning costs(a) — — % — — % 191.5 1.8 % — — % Gain on disposition of subsidiary(a) — — % — — % (78.8) (0.7) % — — % Charges arising from the effects of the war in Ukraine(a) — — % — — % — — % 113.4 1.1 % Cost of services 2,875.1 2,757.1 8,737.8 8,521.5 Selling, general and administrative expenses 89.8 2.5 % 86.4 2.5 % 278.1 2.6 % 294.0 2.8 % Depreciation and amortization 52.4 1.5 % 53.9 1.6 % 157.4 1.5 % 164.8 1.6 % Total operating expenses 3,017.3 84.3 % 2,897.4 84.1 % 9,173.3 86.3 % 8,980.3 86.2 % Operating Income $ 560.8 $ 546.0 $ 1,458.0 $ 1,440.6 In millions. See Notes on page 13.


 
9 Third Quarter Year to Date Reported 2023 Reported 2022 Reported 2023 Non-GAAP Adjustments Non-GAAP Adjusted 2023 Reported 2022 Non-GAAP Adjustments Non-GAAP Adjusted 2022 Revenue $ 3,578.1 $ 3,443.4 $ 10,631.3 $ — $ 10,631.3 $ 10,420.9 $ — $ 10,420.9 Operating Expenses: Real estate and other repositioning costs — 191.5 — Charges arising from the effects of the war in Ukraine — — 113.4 Gain on disposition of subsidiary — (78.8) — Operating Expenses(a) 3,017.3 2,897.4 9,173.3 (112.7) 9,060.6 8,980.3 (113.4) 8,866.9 Operating Income 560.8 546.0 1,458.0 112.7 1,570.7 1,440.6 113.4 1,554.0 Operating Income Margin % 15.7 % 15.9 % 13.7 % 14.8 % 13.8 % 14.9 % Net Interest Expense 38.3 29.1 85.0 — 85.0 112.0 — 112.0 Income Tax Expense(b) 136.1 134.7 360.7 23.1 383.8 383.3 (4.8) 378.5 Income Tax Rate 26.0 % 26.1 % 26.3 % 25.8 % 28.8 % 26.2 % Income from Equity Method Investments 1.9 1.1 3.1 — 3.1 2.6 — 2.6 Net Income Attributed to Noncontrolling Interests 16.4 18.8 49.7 — 49.7 61.2 — 61.2 Net Income - Omnicom Group Inc.(a)(b) $ 371.9 $ 364.5 $ 965.7 $ 89.6 $ 1,055.3 $ 886.7 $ 118.2 $ 1,004.9 Net Income per Share - Diluted(a)(b) $ 1.86 $ 1.77 $ 4.78 $ 0.44 $ 5.22 $ 4.27 $ 0.57 $ 4.84 EBITA $ 581.1 $ 566.1 $ 1,516.9 $ 112.7 $ 1,629.6 $ 1,500.9 $ 113.4 $ 1,614.3 EBITA Margin % 16.2 % 16.4 % 14.3 % 15.3 % 14.4 % 15.5 % Income Statement Summary - Non-GAAP Adjusted In millions except per share amounts. See Notes on page 13 and Non-GAAP reconciliations on pages 18 - 21.


 
10 Cash Flow Performance Nine Months Ended September 30, 2023 2022 Free Cash Flow(4) $ 1,348.1 $ 1,232.5 Primary Uses of Cash: Dividends paid to Common Shareholders 424.0 437.7 Dividends paid to Noncontrolling Interest Shareholders 47.0 62.9 Capital Expenditures 64.2 65.6 Acquisition payments, including payment of contingent purchase price obligations, and acquisition of additional noncontrolling interests 202.4 330.2 Stock Repurchases, net of Proceeds from Stock Plans 529.8 485.9 Primary Uses of Cash(4) 1,267.4 1,382.3 Net Free Cash Flow(4) $ 80.7 $ (149.8) In millions. See Definition on page 13 and Non-GAAP reconciliations on pages 18 - 21.


 
11 Credit & Liquidity $ Millions Twelve Months Ended September 30, 2023 2022 EBITDA(5) $ 2,312.7 $ 2,282.1 Total Debt / EBITDA 2.4 x 2.4 x Net Debt(6) / EBITDA 1.2 x 0.9 x Debt Bank Loans (Due Less Than 1 Year) $ 14.5 $ 10.2 USD-denominated Senior Notes 4,150.0 4,150.0 EUR-denominated Senior Notes 1,056.6 976.0 GBP-denominated Senior Notes 396.6 359.6 Other (31.1) (35.0) Total Debt $ 5,586.6 $ 5,460.8 Cash and Equivalents 2,769.6 3,198.5 Short Term Investments — 94.9 Net Debt(6) $ 2,817.0 $ 2,167.4 In millions. See Definitions on page 13 and Non-GAAP reconciliations on pages 18 - 21.


 
12 Historical Returns Return on Invested Capital (ROIC)(7) Return on Equity(8) Twelve months ended September 30, 2023 22.6 % Twelve months ended September 30, 2023 46.7 % Twelve months ended September 30, 2022 25.0 % Twelve months ended September 30, 2022 43.2 % In millions. See Definitions on page 13.


 
13 Notes (a) For the nine months ended September 30, 2023, operating expenses included real estate operating lease impairment charges, severance, and other exit costs related to repositioning actions we took in the first and second quarters of 2023 to reduce our real estate requirements, rebalance our workforce, and consolidate operations in certain markets. In addition, in the second quarter of 2023, we recorded a gain on disposition of certain of our research businesses in the Execution & Support discipline. The net aggregate impact to Operating Income for the nine months ended September 30, 2023 was a reduction of $112.7 million ($89.6 million after tax). The net aggregate effect of these items in the nine months ended September 30, 2023 to diluted net income per share - Omnicom Group Inc. was a decrease of $0.44. For the nine months ended September 30, 2022, operating expenses included $113.4 million of charges recorded in the first quarter of 2022 as well as an additional net income tax charge of $4.8 million related to the disposition of our businesses in Russia, which reduced net income - Omnicom Group Inc. by $118.2 million and diluted net income per share - Omnicom Group Inc. by $0.57. (b) Income tax includes impacts related to a gain on the disposition of a subsidiary, repositioning costs, and charges arising from the effects of the war in Ukraine, as discussed above. (c) Third-party service costs include third-party supplier costs when we act as principal in providing services to our clients. (d) Third-party incidental costs primarily consist of client-related travel and incidental out-of-pocket costs which we bill back to the client directly at our cost and which we are required to include in revenue. (e) Constant Dollar ("C$") expense is calculated by translating the current period’s local currency expense using the prior period average exchange rates to derive current period C$ expense. The foreign exchange rate impact is the difference between the current period expense in U.S. Dollars and the current period C$ expense. Financial Definitions (1) Foreign exchange rate impact: calculated by translating the current period’s local currency revenue using the prior period average exchange rates to derive current period constant currency revenue. The foreign exchange rate impact is the difference between the current period revenue in U.S. Dollars and the current period constant currency revenue. (2) Acquisition revenue, net of disposition revenue: Acquisition revenue is calculated as if the acquisition occurred twelve months prior to the acquisition date by aggregating the comparable prior period revenue of acquisitions through the acquisition date. As a result, acquisition revenue excludes the positive or negative difference between our current period revenue subsequent to the acquisition date and the comparable prior period revenue and the positive or negative growth after the acquisition date is attributed to organic growth. Disposition revenue is calculated as if the disposition occurred twelve months prior to the disposition date by aggregating the comparable prior period revenue of disposals through the disposition date. The acquisition revenue and disposition revenue amounts are netted in the presentation on page 4. (3) Organic growth: calculated by subtracting the foreign exchange rate impact, and the acquisition revenue, net of disposition revenue components from total revenue growth. (4) See page 18 for the reconciliation of Non-GAAP financial measures, which reconciles Free Cash Flow to the Net Cash Used in Operating Activities and Net Free Cash Flow to the Net Decrease in Cash and Cash Equivalents for the periods presented on page 10. The Free Cash Flow, Primary Uses of Cash and Net Free Cash Flow amounts presented on page 10 are Non-GAAP liquidity measures. See page 22 for the definition of Net Free Cash Flow. (5) EBITA and EBITDA are Non-GAAP performance measure. See page 22 for the definition of these measures and page 19 for the reconciliation of Non-GAAP financial measures. (6) Net Debt is a Non-GAAP liquidity measure. See page 22 for the definition of this measure, which is reconciled in the table on page 11. (7) Return on Invested Capital is After Tax Reported Operating Income (a Non-GAAP performance measure – see page 22 for the definition of this measure and page 18 for the reconciliation of Non-GAAP financial measures) divided by the average of Invested Capital at the beginning and the end of the period (book value of all long-term liabilities, including those related to operating leases, short-term interest bearing debt, the short-term liability related to operating leases plus shareholders’ equity less cash, cash equivalents, short-term investments and operating lease right of use assets). (8) Return on Equity is Reported Net Income for the given period divided by the average of shareholders’ equity at the beginning and end of the period. (9) The Free Cash Flow amounts presented on page 16 are Non-GAAP liquidity measures. See page 22 for the definition of this measure and page 18 for the reconciliation of the Non-GAAP financial measures, which reconciles Free Cash Flow to the Net Cash Used in Operating Activities for the periods presented on page 16.


 
14 Appendix


 
15 Acquisitions - Q3 2023 • PLUS Communications is a top public affairs firm and FP1 Strategies is a leading political consultancy. Based in Washington D.C., the companies expand our U.S. expertise in public affairs and crisis communications with particular strength in technology and healthcare • Outpromo and Global Shopper are two of Brazil’s leading connected commerce and retail media agencies. The acquisitions create the foundation for a dedicated, end-to-end e-commerce and retail media performance agency in the Brazilian market for Omnicom Media Group • Headquartered in London, Ptarmigan Media offers end-to-end media and marketing solutions to financial services brands. Ptarmigan specializes in Asset Management, Life and Pensions, Banking, Trading and Platforms, Wealth Management, Fintech, and Insurance sectors across APAC, EMEA, and North America • Grabarz & Partner is a world-class creative agency headquartered in Hamburg. The acquisition cements Omnicom's leadership position in Germany, the fourth- largest advertising market in the world OMC Discipline Public Relations Advertising & Media Advertising & Media Advertising & Media


 
16 Free Cash Flow Nine Months Ended September 30, 2023 2022 Net Income $ 1,015.4 $ 947.9 Depreciation and Amortization of Intangible Assets 157.4 164.8 Share-Based Compensation 63.6 61.3 Real estate and other repositioning costs 191.5 — Gain on disposition of subsidiary (78.8) — Non-cash charge related to the effects of the war in Ukraine — 65.8 Other Items to Reconcile to Net Cash Used in Operating Activities, net (1.0) (7.3) Free Cash Flow(9) $ 1,348.1 $ 1,232.5 In millions. See Definition on page 13 and Non-GAAP reconciliations on pages 18 - 21.


 
17 Operating Expense Detail - Constant $ Third Quarter Year to Date 2023 2023 C$(e) 2022 2023 2023 C$(e) 2022 Operating expenses: Salary and related service costs $ 1,756.7 $ 1,721.8 $ 1,749.1 $ 5,306.7 $ 5,338.8 $ 5,344.5 Third-party service costs(c) 678.8 667.9 588.2 2,033.9 2,045.0 1,799.0 Third-party incidental costs(d) 151.0 150.3 138.8 406.6 412.2 390.4 Salary and service costs 2,586.5 2,540.0 2,476.1 7,747.2 7,796.0 7,533.9 Occupancy and other costs 288.6 282.2 281.0 877.9 885.8 874.2 Real estate and other repositioning costs(a) — — — 191.5 191.5 — Charges arising from the effects of the war in Ukraine(a) — — — — — 113.4 Gain on disposition of subsidiary(a) — — — (78.8) (78.8) — Cost of services 2,875.1 2,822.2 2,757.1 8,737.8 8,794.5 8,521.5 Selling, general and administrative expenses 89.8 88.3 86.4 278.1 279.6 294.0 Depreciation and amortization 52.4 51.4 53.9 157.4 158.1 164.8 Total operating expenses $ 3,017.3 $ 2,961.9 $ 2,897.4 $ 9,173.3 $ 9,232.2 $ 8,980.3 In millions. See Notes on page 13.


 
18 Non-GAAP Reconciliations Nine Months Ended September 30, 2023 2022 Net Cash Used in Operating Activities $ (379.1) $ (250.6) Operating Activities items excluded from Free Cash Flow: Changes in Operating Capital (1,727.2) (1,483.1) Free Cash Flow $ 1,348.1 $ 1,232.5 Net Decrease in Cash and Cash Equivalents $ (1,512.2) $ (2,118.3) Cash Flow items excluded from Net Free Cash Flow: Changes in Operating Capital (1,727.2) (1,483.1) Proceeds from (purchase of) short-term investments 60.8 (100.0) Proceeds from disposition of subsidiary and other 192.6 35.6 Changes in Short-term Debt, net (4.6) 1.2 Other financing, net (46.5) (51.0) Effect of foreign exchange rate changes on cash and cash equivalents (68.0) (371.2) Net Free Cash Flow $ 80.7 $ (149.8) Twelve Months Ended September 30, 2023 2022 Reported Operating Income $ 2,100.7 $ 2,063.1 Effective Tax Rate for the applicable period 26.3 % 27.1 % Income Taxes on Reported Operating Income 552.5 559.1 After Tax Reported Operating Income $ 1,548.2 $ 1,504.0 In millions


 
19 Non-GAAP Reconciliations In millions The above table reconciles the GAAP financial measure of Net Income – Omnicom Group Inc. to the Non-GAAP financial measures of EBITDA and EBITA for the periods presented. EBITDA and EBITA, which are defined on page 22, are Non-GAAP financial measures within the meaning of applicable SEC rules and regulations. Our credit facility defines EBITDA as earnings before deducting interest expense, income taxes, depreciation and amortization, and excludes certain other one-time items. Our credit facility uses EBITDA to measure our compliance with covenants, such as our leverage ratios, as presented on page 11 of this presentation. Adjusted EBITA and EBITA Margin- Adjusted are Non-GAAP measures and management believes excluding the charges arising from the effects of the war in Ukraine, a gain on the disposition of a subsidiary and repositioning costs provides investors with a better picture of the performance of the business during the periods presented. See page 22 for definition of Non-GAAP financial measures. Three Months Ended Nine Months Ended Twelve Months Ended September 30 September 30 September 30 2023 2022 2023 2022 2023 2022 Net Income - Omnicom Group Inc. $ 371.9 $ 364.5 $ 965.7 $ 886.7 $ 1,395.5 $ 1,302.9 Net Income Attributed to Noncontrolling Interests 16.4 18.8 49.7 61.2 75.8 94.9 Income From Equity Method Investments 1.9 1.1 3.1 2.6 5.7 8.0 Income Tax Expense 136.1 134.7 360.7 383.3 524.2 516.9 Income Before Income Taxes and Income From Equity Method Investments 522.5 516.9 1,373.0 1,328.6 1,989.8 1,906.7 Net Interest Expense 38.3 29.1 85.0 112.0 110.9 156.4 Operating Income 560.8 546.0 1,458.0 1,440.6 2,100.7 2,063.1 Amortization of Intangible Assets 20.3 20.1 58.9 60.3 78.9 80.5 EBITA 581.1 566.1 1,516.9 1,500.9 2,179.6 2,143.6 Depreciation 32.1 33.8 98.5 104.5 133.1 138.5 EBITDA $ 613.2 $ 599.9 $ 1,615.4 $ 1,605.4 $ 2,312.7 $ 2,282.1 EBITA $ 581.1 $ 566.1 $ 1,516.9 $ 1,500.9 Real estate and other repositioning costs — — 191.5 — Charges arising from the effects of the war in Ukraine — — — 113.4 Gain on disposition of subsidiary — — (78.8) — EBITA - Adjusted $ 581.1 $ 566.1 $ 1,629.6 $ 1,614.3 Revenue $ 3,578.1 $ 3,443.4 $ 10,631.3 $ 10,420.9 EBITA $ 581.1 $ 566.1 $ 1,516.9 $ 1,500.9 EBITA Margin % 16.2 % 16.4 % 14.3 % 14.4 % EBITA - Adjusted $ 581.1 $ 566.1 $ 1,629.6 $ 1,614.3 EBITA Margin % - Adjusted 16.2 % 16.4 % 15.3 % 15.5 %


 
20 Non-GAAP Reconciliations In millions The above table reconciles the GAAP financial measure of Operating Income to the non-GAAP financial measure of Operating Income Adjusted for the periods presented. Management believes excluding the charges arising from the effects of the war in Ukraine, a gain on the disposition of a subsidiary and repositioning costs provides investors with a better picture of the performance of the business during the periods presented. EBITA, which is defined on page 22, is a Non-GAAP financial measures within the meaning of applicable SEC rules and regulations. Three Months Ended Nine Months Ended September 30 September 30 2023 2022 2023 2022 Net Income - Omnicom Group Inc.- Reported $ 371.9 $ 364.5 $ 965.7 $ 886.7 Net Income Attributed To Noncontrolling Interests 16.4 18.8 49.7 61.2 Income From Equity Method Investments 1.9 1.1 3.1 2.6 Income Tax Expense 136.1 134.7 360.7 383.3 Income Before Income Taxes and Income From Equity Method Investments 522.5 516.9 1,373.0 1,328.6 Net Interest Expense 38.3 29.1 85.0 112.0 Operating Income - Reported 560.8 546.0 1,458.0 1,440.6 Real estate and other repositioning costs — — 191.5 — Charges arising from the effects of the war in Ukraine — — — 113.4 Gain on disposition of subsidiary — — (78.8) — Non-GAAP Operating Income - Adjusted $ 560.8 $ 546.0 $ 1,570.7 $ 1,554.0


 
21 Third Quarter Year to Date 2023 2022 2023 2022 Net Income - Omnicom Group Inc. - Reported $ 371.9 $ 364.5 $ 965.7 $ 886.7 Impact on Net Income related to: Real estate and other repositioning costs — — 145.5 — Charges arising from the effects of the war in Ukraine — — — 118.2 Gain on disposition of subsidiary — — (55.9) — Net Income - Omnicom Group Inc. - Adjusted $ 371.9 $ 364.5 $ 1,055.3 $ 1,004.9 Diluted Shares 199.9 206.3 202.0 207.6 Net Income per Share - Omnicom Group Inc. - Adjusted $ 1.86 $ 1.77 $ 5.22 $ 4.84 Non-GAAP Reconciliations In millions except per share amounts The above table reconciles GAAP Net Income to Non-GAAP adjusted Net Income and Adjusted Diluted Net Income per Share - Omnicom Group Inc., adjusted for a gain on the disposition of a subsidiary and real estate and other repositioning costs in 2023 and the charges arising from the effects of the war in Ukraine in 2022. See page 22 for definition of Non-GAAP financial measures.


 
22 Disclosures The preceding materials have been prepared for use in the October 17, 2023 conference call on Omnicom’s results of operations for the three and nine months ended September 30, 2023. The call will be archived on the Internet at http:// investor.omnicomgroup.com Forward-Looking Statements Certain statements in this document constitute forward-looking statements, including statements within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, from time to time, the Company or its representatives have made, or may make, forward-looking statements, orally or in writing. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial position, or otherwise, based on current beliefs of the Company’s management as well as assumptions made by, and information currently available to, the Company’s management. Forward-looking statements may be accompanied by words such as “aim,” “anticipate,” “believe,” “plan,” “could,” “should,” “would,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “will,” “possible,” “potential,” “predict,” “project” or similar words, phrases or expressions. These forward-looking statements are subject to various risks and uncertainties, many of which are outside the Company’s control. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include: adverse economic conditions, including those caused by the war in Ukraine, the lingering effects of the COVID-19 pandemic, high and persistent inflation in countries that comprise our major markets, rising interest rates; supply chain issues affecting the distribution of our clients’ products; international, national or local economic conditions that could adversely affect the Company or its clients; losses on media purchases and production costs incurred on behalf of clients; reductions in client spending, a slowdown in client payments and a deterioration or a disruption in the credit markets; the ability to attract new clients and retain existing clients in the manner anticipated; changes in client advertising, marketing and corporate communications requirements; failure to manage potential conflicts of interest between or among clients; unanticipated changes related to competitive factors in the advertising, marketing and corporate communications industries; the ability to hire and retain key personnel; currency exchange rate fluctuations; reliance on information technology systems; changes in legislation or governmental regulations affecting the Company or its clients; risks associated with assumptions the Company makes in connection with its critical accounting estimates and legal proceedings; and the Company’s international operations, which are subject to the risks of currency repatriation restrictions, social or political conditions and regulatory environment; effectively managing the risks, challenges and efficiencies presented by utilizing Artificial Intelligence (AI) technologies and partnerships in our business; and risks related to our environmental, social and governance goals and initiatives, including impacts from regulators and other stakeholders, and the impact of factors outside of our control on such goals and initiatives. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties that may affect the Company’s business, including those described in Item 1A, “Risk Factors” and Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements. Non-GAAP Financial Measures We present financial measures determined in accordance with generally accepted accounting principles in the United States (“GAAP”) and adjustments to the GAAP presentation (“Non-GAAP”), which we believe are meaningful for understanding our performance. EBITA is defined as operating income before interest, taxes, and amortization of intangible assets, and EBITA margin is defined as EBITA divided by revenue. We use EBITA and EBITA margin as additional operating performance measures, which exclude the non-cash amortization expense of intangible assets (primarily consisting of amortization arising from acquisitions). We also use Adjusted Operating Income, Adjusted Operating Income Margin, Adjusted EBITA, Adjusted EBITA Margin, Adjusted Income Tax Expense, Adjusted Net Income – Omnicom Group Inc. and Adjusted Net Income per diluted share – Omnicom Group Inc. as additional operating performance measures. Free Cash Flow is defined as net income plus depreciation, amortization, share based compensation expense plus/(less) other items to reconcile to net cash (used in) provided by operating activities. We believe Free Cash Flow is a useful measure of liquidity to evaluate our ability to generate excess cash from our operations. Primary Uses of Cash, defined as dividends to common shareholders, dividends paid to non-controlling interest shareholders, capital expenditures, cash paid on acquisitions, payments for additional interest in controlled subsidiaries and stock repurchases, net of the proceeds from our stock plans, and excludes changes in operating capital and other investing and financing activities, including commercial paper issuances and redemptions used to fund working capital changes. We believe this liquidity measure is useful in identifying the significant uses of our cash. Net Free Cash Flow is defined as Free Cash Flow less the Primary Uses of Cash. Net Free Cash Flow is one of the metrics used by us to assess our sources and uses of cash and was derived from our consolidated statements of cash flows. We believe that this liquidity measure is meaningful for understanding our primary sources and primary uses of that cash flow. EBITDA is defined as operating profit before interest, taxes, depreciation and amortization of intangible assets. Net Debt is defined as total debt less cash, cash equivalents and short-term investments. We believe net debt, together with the comparable GAAP measures, reflects one of the liquidity metrics used by us to assess our cash management. We believe these measures are useful in evaluating the impact of certain items on operating performance and allow for comparability between reporting periods. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in accordance with GAAP. Non-GAAP financial measures as reported by us may not be comparable to similarly titled amounts reported by other companies. Other Information All dollar amounts are in millions except for per share figures. The information contained in this document has not been audited, although some data has been derived from Omnicom’s historical financial statements, including its audited financial statements. In addition, industry, operational and other non-financial data contained in this document have been derived from sources that we believe to be reliable, but we have not independently verified such information, and we do not, nor does any other person, assume responsibility for the accuracy or completeness of that information. Certain amounts in prior periods have been reclassified to conform to our current presentation. The inclusion of information in this presentation does not mean that such information is material or that disclosure of such information is required.