Interpublic, the US marketing services company that this year restated results for the entire decade, said on Wednesday that its losses narrowed in the third quarter but that its revenues were weaker than expected.
Michael Roth, Interpublic’s chairman and chief executive, blamed the revenue disappointment on client losses and said the defections could continue to impair performance through the first half of next year.
“It is apparent that there is additional work to be done,” said Mr Roth, an accountant and former financial services industry executive who has been struggling to straighten out Interpublic’s tangled acc-ounts.
“Results in the year to date are not where we would like them.”
Interpublic’s shares, which have been badly beaten down by years of bad news, fell another 4.2 per cent to $10.03 by the close of trading in New York.
Interpublic, the world’s third-biggest marketing services group, said it lost $101.5m in the third quarter, compared with $501.5m last year. Revenues fell 5.1 per cent to $1.44bn. Organic revenues – adjusted for currency fluctuations and divestments – fell 2.6 per cent.
Mr Roth said revenues were weaker than expected because of the recent loss of one of Interpublic’s biggest clients, Bank of America.
Interpublic had expected the defection would hit its accounts mainly in the first half of next year, but it said on Wednesday the impact would be felt mainly this year.
Alexia Quadrani, an analyst at Bear Stearns, said she was particularly troubled by the disclosure in the quarterly filing with the SEC that its revenue weakness “was primarily driven” by setbacks at its McCann Worldgroup and Deutsch agencies.
She said the weakness at McCann was a sign that this was “a turnround story” that would take longer than many people expected.
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