Omnicom Group (OMC) Q2 2012 Earnings Call July 17, 2012 8:30 am ET Executives Randall J. Weisenburger - Chief Financial Officer and Executive Vice President John D. Wren - Chief Executive Officer, President and Director Analysts Alexia S. Quadrani - JP Morgan Chase & Co, Research Division John Janedis - UBS Investment Bank, Research Division Craig Huber Leo Kulp - Citigroup Inc, Research Division James G. Dix - Wedbush Securities Inc., Research Division Anthony J. DiClemente - Barclays Capital, Research Division William G. Bird - Lazard Capital Markets LLC, Research Division Peter Stabler - Wells Fargo Securities, LLC, Research Division Tim Nollen - Macquarie Research Daniel Salmon - BMO Capital Markets U.S. Presentation Operator
I'd also like to remind you that during the course of the call, we will discuss some non-GAAP measures in talking about our performance. You can find a reconciliation of those measures to the nearest comparable GAAP measures in the presentation materials.We're going to begin the call with some brief remarks from John Wren. Following John's remarks, we'll review our financial performance for the quarter, and then both John and I will be happy to take questions. John D. Wren Good morning, and thank you for joining us on the call. I'd like to spend my time this morning by starting with our latest business results, give you my thoughts on the current environment and discuss our expectations for the rest of 2012. I'm happy to say that we had another strong quarter, especially when you consider some of the economic headwinds out there. We continue to deliver above average organic growth, and we remain very much on track to achieve our margin objectives for the year. For the second half, we are cautiously optimistic about revenues. We recognize that there are risks in a number of regions that could impact global growth. On the risk side, the situation in Europe remains tenuous. In the U.S., continuing fiscal concerns, unemployment and the upcoming elections create uncertainty. In Asia, even though overall growth is still quite attractive, the pace of their economic growth is also moderating. On the plus side, central banks in the U.S., Europe and Asia are acting in a manner that supports growth. And in our conversations with our clients, their focus remains on building their businesses around the world. We continue to keep an eye on the macroeconomic picture, but as I said last quarter, we are most focused on the things we can control. Even as we tightly manage our costs, we are making smart investments in our people, our service capabilities and our geographic footprint. These investments don't always make headlines themselves, but they are helping us to consistently win new business and to extend our existing client relationships.
Across all of our networks and agencies, we are investing in talented people who are helping us to broaden our capabilities and service offerings and to fulfill our commitment to differentiating creative and executional excellence on behalf of our clients. This was most recently illustrated by our outstanding performance at the International Festival of Creativity in Cannes, where Omnicom agencies from 34 countries won more than 200 Lions, representing over 90 clients. I want to congratulate all of our agencies on their performance.The future of our industry belongs to those organizations that can deliver integrated solutions for clients. The marketplace is getting more complex. Consumers are blurring the lines between offline and online. New technologies offer greater opportunities to effectively communicate with customers, and in my opinion, we're only at the beginning. We are just learning how to effectively utilize social media and smartphone technology. To be successful, agencies must increasingly blend all these media, together with a deep understanding of data and analytics, to help their clients find and serve customers where they are and the way they want. And our agencies must be agile enough to keep learning and changing as technology does. Our entire digital strategy is built around this idea: build the expertise in every agency, make sure we are not weighted to any single technology and integrate these capabilities to better service our clients. In a recent example of our approach, in late June, TBWA announced the formation of the Digital Arts Network. Digital Arts Network unifies TBWA's proven digital talent, encompassing over 700 digital specialists in the network and initially rolling it out in 18 markets, a global footprint to rival any pure play digital shop. This talent will remain fully integrated within TBWA's existing business. Read the rest of this transcript for free on seekingalpha.com