Interpublic Group of Cos. (NYSE: IPG) reported Q1 EPS of $0.04, in-line with the analyst estimate of $0.04. Revenue for the quarter came in at $2 billion versus the consensus estimate of $1.96 billion.

• First quarter net revenue increase of 13.0%, with strong organic net revenue growth of 6.4%
• In seasonally small first quarter, net loss was $9.5 million, compared to net loss of $16.1 million in 2018, and adjusted EBITA1 was $103.6 million compared to $44.1 million in 2018
• Diluted loss per share of $0.02, and earnings per diluted share of $0.11 as adjusted compared to earnings of $0.04 as adjusted in 2018
• Management confirms that the company is on track to achieve its full-year organic net revenue growth target of 2.0% to 3.0% and adjusted EBITA margin expansion of 40 to 50 basis points

Summary

Revenue

• Net revenue of $2.00 billion in the first quarter of 2019 increased 13.0% compared with the same period in 2018. During the quarter, the organic net revenue increase (which excludes results from Acxiom) was 6.4%, while the effect of foreign currency translation was negative 2.8%, and the impact of net acquisitions was positive 9.4%. Total revenue of $2.36 billion in the first quarter of 2019 increased 8.9% compared with the same period in 2018.

Operating Results

• Operating income in the first quarter of 2019 was $50.2 million, compared to $38.8 million in 2018. For the first quarter of 2019, operating margin on net revenue was 2.5%, compared to 2.2% in 2018.
• Adjusted EBITA1 excluding $31.8 million of restructuring charges was $103.6 million in the first quarter of 2019 compared to $44.1 million in 2018. For the first quarter of 2019, adjusted EBITA margin on net revenue was 5.2%, compared to 2.5% in 2018.

Net Results

• Income tax provision in the first quarter of 2019 was $10.5 million on income before income taxes of $1.3 million.
• First quarter 2019 net loss available to IPG common stockholders was $8.0 million, resulting in loss of $0.02 per basic and diluted share, and earnings of $0.11 per diluted share as adjusted for after-tax amortization of acquired intangibles of $17.4 million, after-tax restructuring charges of $24.2 million, and after-tax loss of $8.6 million on the sales of businesses. This compares to adjusted earnings of $0.04 per basic and diluted share a year ago. Refer to reconciliations in the back for more detail.

"We continue to be pleased with our strong organic growth in the U.S. and in all international regions. Our results were driven by strong top- and bottom-line performance in media, as well as growth from our global creative networks, public relations and digital offerings. While Q1 is our smallest seasonal quarter, our results continue to demonstrate the many strengths of our company and underscore the successful evolution of our offerings amid significant change in the environment in which we operate. With Acxiom, we have also significantly strengthened our position as it relates to helping clients succeed in a world where data-driven marketing solutions are core to brands' success," said Michael I. Roth, Interpublic's Chairman and CEO.

"We remain on track to deliver on our targets of organic growth of 2.0% to 3.0% and 40 to 50 basis points of improvement to our adjusted EBITA margin for the full year. This takes into account the impact certain losses that took place in late 2018 will have over the remainder of this year. Our operating performance, combined with our commitment to deleverage our balance sheet and our strong history of capital return programs, including dividend increases, means we remain well positioned to further enhance shareholder value," concluded Michael Roth.

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