Revenue of $3.6 billion, with organic growth of 4.0% Diluted earnings per share of $1.59; $1.67 Non-GAAP adjusted Operating income of $478.9 million and 13.2% margin EBITA of $500.4 million and 13.8% margin NEW YORK, April 16, 2024 /PRNewswire/ -- Omnicom (NYSE:OMC) today announced results for the quarter ended March 31, 2024. "Omnicom began the year with solid organic revenue growth of 4.0%, led by continued strength in our advertising & media and precision marketing disciplines, including Flywheel Digital," said John Wren, Chairman and Chief Executive Officer of Omnicom. "We are uniquely able to combine marketing and sales solutions with a seamless set of information signals to turn our award-winning creativity into measurable dynamic business outcomes for our clients.  Our industry-leading tools and platforms, combined with the strength of our operating leadership, has led to our excellent new business performance and, when combined with the new opportunities we are pursuing, give us great confidence in the future." First Quarter 2024 Results Three Months Ended March 31, $ in millions, except per share amounts 2024 2023 Revenue $ 3,630.5 $ 3,443.3 Operating Income 478.9 346.5 Operating Income Margin 13.2 % 10.1 % Net Income1 318.6 227.5 Net Income per Share - Diluted1 $      1.59 $      1.11 Non-GAAP Measures2: EBITA3 500.4 361.3 EBITA Margin3 13.8 % 10.5 % Adjusted EBITA4 480.5 Adjusted EBITA Margin4 14.0 % After-tax amortization per diluted share5 $      0.08 $      0.05 Non-GAAP Adjusted Net Income per Share - Diluted3,4,5 $      1.67 $      1.61 Notes: 1) Net Income and Net Income per Share for Omnicom Group Inc. 2) See non-GAAP reconciliations starting on page 8. 3) Beginning with the three months ended March 31, 2024, EBITA is defined as operating income before amortization of acquired intangible assets and internally developed strategic platform assets. As a result, we reclassified the prior year to be consistent with the revised definition, which reduced EBITA from previously reported amounts. 4) For the three months ended March 31, 2023, operating expenses include $119.2 million ($91.0 million after-tax, $0.45 per diluted share) related to real estate repositioning costs. 5) Beginning with the three months ended March 31, 2024, Adjusted Net Income per Share - Diluted excludes after-tax amortization of acquired intangible assets and internally developed strategic platform assets. RevenueReported revenue in the first quarter of 2024 increased $187.2 million, or 5.4%, to $3,630.5 million. Worldwide revenue growth in the first quarter of 2024 compared to the first quarter of 2023 was led by an increase in organic growth of $136.9 million, or 4.0%. Acquisition revenue, net of disposition revenue, increased revenue by $53.0 million, or 1.5%, primarily due to the Flywheel Digital acquisition in the Precision Marketing discipline. The impact of foreign currency translation reduced revenue by $2.7 million, or 0.1%. Organic growth by discipline in the first quarter of 2024 compared to the first quarter of 2023 was as follows: 7.0% for Advertising & Media, 4.3% for Precision Marketing, 9.5% for Experiential, and 2.1% for Healthcare, partially offset by declines of 4.3% for Execution & Support, 3.8% for Branding & Retail Commerce, and 1.1% for Public Relations. Organic growth by region in the first quarter of 2024 compared to the first quarter of 2023 was as follows: 4.3% for the United States, 3.5% for Euro Markets & Other Europe, 22.3% for Latin America, 3.0% for Asia Pacific, 3.2% for the United Kingdom, and 1.1% for Other North America, partially offset by a decline of 4.2% for the Middle East & Africa. ExpensesOperating expenses increased $54.8 million, or 1.8%, to $3,151.6 million in the first quarter of 2024 compared to the first quarter of 2023. Salary and service costs increased $149.7 million, or 5.9%, to $2,692.6 million. These costs tend to fluctuate with changes in revenue and are comprised of salary and related costs, which include employee compensation and benefits costs, freelance labor, third-party service costs, and third-party incidental costs. Salary and related costs increased $69.3 million, or 3.9%, to $1,847.3 million, primarily due to an increase in headcount primarily as a result of our acquisition of Flywheel Digital. Third-party service costs include third-party supplier costs when we act as principal in providing services to our clients. Third-party incidental costs that are required to be included in revenue primarily consist of client-related travel and incidental out-of-pocket costs, which are billed back to the client directly at our cost. Third-party service costs increased $58.9 million, or 9.2%, to $698.2 million, and third-party incidental costs increased $21.5 million, or 17.1%, to $147.1 million, both primarily as a result of organic growth. Occupancy and other costs, which are less directly linked to changes in revenue than salary and service costs, increased $22.5 million, or 7.7%, to $314.1 million. The increase is primarily related to our acquisition activity in the period. Increased occupancy costs were partially offset by lower rent expense. SG&A expenses decreased $3.9 million, or 4.4%, to $85.3 million, primarily due to a decrease in administrative costs. Operating IncomeOperating income increased $132.4 million, or 38.2%, to $478.9 million in the first quarter of 2024 compared to the first quarter of 2023, and the related margin increased to 13.2% from 10.1%. In the three months ended March 31, 2023, the effect of real estate repositioning costs reduced operating income by $119.2 million and decreased operating margin by 3.4%. Interest Expense, netInterest expense was flat, offset by a decrease in interest income of $8.6 million due primarily to lower average cash and short-term investment balances.  Income TaxesOur effective tax rate for the three months ended March 31, 2024 increased period-over-period to 25.7% from 25.5%. The effective tax rate for 2024 includes the favorable impact from the resolution of certain tax positions of $7.5 million. The effective tax rate for the three months ended March 31, 2023 includes the favorable impact of approximately $10.0 million of previously unrecognized tax benefits, partially offset by approximately $6.0 million related to a lower tax benefit in certain jurisdictions for the real estate repositioning costs in the quarter, and an increase in the U.K. statutory tax rate. Net Income – Omnicom Group Inc. and Diluted Net Income per ShareNet income - Omnicom Group Inc. for the first quarter of 2024 increased $91.1 million, or 40.0%, to $318.6 million compared to the first quarter of 2023. Diluted shares outstanding for the first quarter of 2024 decreased 2.2% to 200.1 million from 204.5 million as a result of net share repurchases. Diluted net income per share of $1.59 increased $0.48, or 43.2%, from $1.11. The first quarter 2023 included $119.2 million ($91.0 million after-tax, $0.45 per diluted share) related to real estate repositioning costs. Beginning with the three months ended March 31, 2024, Non-GAAP Adjusted Net Income per Share - Diluted excludes the effect of after-tax amortization of acquired intangible assets and internally developed strategic platform assets.  For the three months ended March 31, 2024, Non-GAAP Adjusted Net Income per Share - Diluted of $1.67 increased $0.06 or 3.7%, from Non-GAAP Adjusted Net Income per Share - Diluted of $1.61 in the first quarter of 2023. We present Non-GAAP Adjusted Net Income per Share - Diluted to allow for comparability with the prior year period. EBITAAdjusted EBITA increased $19.9 million, or 4.1%, to $500.4 million in the first quarter of 2024 compared to the first quarter of 2023, and the related margin decreased to 13.8% from 14.0%. Risks and UncertaintiesCurrent global economic challenges, including geopolitical events, international hostilities, acts of terrorism, public health crises, high and sustained inflation in countries that comprise our major markets, high interest rates, and labor and supply chain issues could cause economic uncertainty and volatility. The impact of these issues on our business will vary by geographic market and discipline. We monitor economic conditions closely, as well as client revenue levels and other factors. In response to reductions in revenue, we can take actions to align our cost structure with changes in client demand and manage our working capital. However, there can be no assurance as to the effectiveness of our efforts to mitigate any impact of the current and future adverse economic conditions, reductions in client revenue, changes in client creditworthiness, and other developments. Definitions - Components of Revenue ChangeWe use certain terms in describing the components of the change in revenue above.  Foreign exchange rate impact: calculated by translating the current period's local currency revenue using the prior period average exchange rates to derive current period constant currency revenue. The foreign exchange rate impact is the difference between the current period revenue in U.S. Dollars and the current period constant currency revenue. Acquisition revenue, net of disposition revenue: Acquisition revenue is calculated as if the acquisition occurred twelve months prior to the acquisition date by aggregating the comparable prior period revenue of acquisitions through the acquisition date. As a result, acquisition revenue excludes the positive or negative difference between our current period revenue subsequent to the acquisition date, and the comparable prior period revenue and the positive or negative growth after the acquisition date is attributed to organic growth. Disposition revenue is calculated as if the disposition occurred twelve months prior to the disposition date by aggregating the comparable prior period revenue of disposals through such date. The acquisition revenue and disposition revenue amounts are netted in the description above. Organic growth: calculated by subtracting the foreign exchange rate impact component and the acquisition revenue, net of disposition revenue component from total revenue growth. Conference CallOmnicom will host a conference call to review its financial results on Tuesday, April 16, 2024, starting at 4:30 p.m. Eastern Time.  A live webcast of the call, along with the related slide presentation, will be available at Omnicom's investor relations website, investor.omnicomgroup.com, and a webcast replay will be made available after the call concludes. Corporate ResponsibilityAt Omnicom, we are committed to promoting responsible practices and making positive contributions to society around the globe. Please explore our website (omnicomgroup.com/corporate-responsibility) for highlights of our progress across the areas on which we focus: Empower People, Protect Our Planet, Lead Responsibly. About OmnicomOmnicom (NYSE:OMC) is a leading provider of data-inspired, creative marketing and sales solutions. Omnicom's iconic agency brands are home to the industry's most innovative communications specialists who are focused on driving intelligent business outcomes for their clients. The company offers a wide range of services in advertising, strategic media planning and buying, precision marketing, retail and digital commerce, branding, experiential, public relations, healthcare marketing and other specialty marketing services to over 5,000 clients in more than 70 countries. For more information, visit www.omnicomgroup.com.  Non-GAAP Financial MeasuresWe present financial measures determined in accordance with generally accepted accounting principles in the United States ("GAAP") and adjustments to the GAAP presentation ("Non-GAAP"), which we believe are meaningful for understanding our performance. We believe these measures are useful in evaluating the impact of certain items on operating performance and allows for comparability between reporting periods. EBITA is defined as operating income before interest, taxes, and amortization of acquired intangible assets and internally developed strategic platform assets, and EBITA margin is defined as EBITA divided by revenue. We use EBITA and ...