Advertising giant Interpublic ( IPG) was under pressure in the premarket after reporting a first-quarter loss that reflected higher expenses and relatively flat revenue.

"Revenue at many operations continued to reflect weak demand for services, while costs increased, in part due to higher severance expense and professional fees," the company said.

The company lost $8.6 million, or 2 cents a share, in the latest quarter, including an $11 million writedown of its sporting event-promoting unit, compared with year-earlier net income of $59.8 million, or 16 cents. Revenue was $1.43 billion, up from $1.42 billion, reflecting slightly higher U.S. results and slightly lower international results.

Quarterly expenses rose 9% to $1.41 billion, as salaries jumped to $908 million from $867 million and office and overhead jumped to $484 million from $420 million.

"Turnarounds take time," the company's CEO said in a statement, adding that current 2003 guidance of 68 cents to 72 a share on a 1% to 4% drop in revenue is achievable. "I believe our company's operating results in the second half of 2003 and the first half of 2004 will finally provide us with a firm baseline for the future performance of the real Interpublic."

The company plans to outline a cost-cutting plan at the end of the second quarter.

On the Instinet premarket session, Interpublic shares were recently down 3.5% at $10.99.

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