Free Trial

Omnicom Q1 Earnings Preview

COMMUNICATIONS


  • Omnicom is due to report Q1 earnings after the close; BBG consensus looking for Q1 revenue +5% YoY with Op Income +2% (note less than ten estimates for both).
  • Q4 results were mixed - Revenue slightly ahead of consensus with a decent beat on organic growth (4.4% vs. 3.5% consensus) and operating income slightly behind consensus. Credit metrics steady; FY23 leverage ratio of 2.3x (credit facilities require <3.5x) from 2.4x at FY22 while ST liquidity and OCF were stable.
  • Omnicom’s new EUR 32s have underperformed since issued in Feb; the EUR 600mn deal saw 25bps of tightening to price at MS+95 (20-25bps wide of where we had seen FV) with a cover of 2.5x; the line has widened by a further ~10bps since then, underperforming both the EUR 31s and peer curves. They now offer ~40bps of pick-up versus the EUR 31s for an eight-month extension.
  • Omnicom EUR 31s have typically traded in line with or tighter than peer lines at WPP and Publicis. However, widening on Omnicom’s February issuance has brought the bond flat to the Publicis EUR 31s.


To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.