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Digital ad demand helps Publicis hike 2021 growth outlook By Reuters

© Reuters. FILE PHOTO – The logo for Publicis Group is displayed at the highly publicized startups and top tech leaders gathering at Viva Tech in Paris, France, May 16, 2019. REUTERS/Charles Platiau

By Milla Nissi

(Reuters) – French advertising company Publicis has raised its outlook to 2021 as a result of a shift toward digital media worldwide. The global shift towards e-commence and digital media helped Publicis’ third quarter organic growth surpass market expectations.

Publicis has been able to increase its digital advertising demand by appealing to new customers with targeted ads based on huge data pools. Publicis also promised organic growth for the first year since the outbreak of the coronavirus.

Publicis, home to ad agencies such as Leo Burnett and Saatchi & Saatchi, said it had also benefited from new business wins during the third quarter, including Walmart (NYSE:) and Planet Fitness (NYSE:).

This year’s global third-largest advertising agency, behind Britain’s WPP and U.S.-based Omnicom, expects to see organic growth of 8.5% – 9% over the previous forecast of 7%.

“The continued outperformance of our data and tech capabilities once again demonstrated our ability to capture a disproportionate share of the shift in client investment towards digital media, commerce and DTC (direct-to-consumer),” Chief Executive Arthur Sadoun said in a statement.

Publicis reported organic growth of 20% in Sapient, its digital business, in the United States. This market is Publicis’ largest and generates more than half of the company’s revenues. Data company Epsilon saw 13% increase over last year.

Sadoun stated that Epsilon’s development potential outside the U.S. was very intriguing when being asked about the unit’s dependence on home markets.

We have an international base of 5 to 8% revenues, but our base has already grown at 40 percent in the nine first months.

The quarter saw an 11.9% increase in US sales, and a 10.9% rise in Asia-Pacific. Europe saw a 10% increase in sales compared to last year. They also regained their pre-pandemic level.

Group sales increased by 11.2% to 2.65 billion euros ($3 billion) during the third quarter, which was higher than the previous year and exceeded the 2019 level by 5%.

A company-provided consensus forecast indicated that analysts expected 7.8% organic growth in the fourth quarter.

($1 = 0.8643 euros)

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Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.