Dentsu Group sees positive momentum in Q2 FY24 with growth in India

Dentsu Group Inc has reported its Q2 FY24 results and the Japanese ad giant announced an improvement of 0.2% in organic revenues on YoY basis. 

According to the financial statement, the second quarter showed continued sequential quarterly improvement driven by a higher client pitch win rate across all four regions year to date. The One dentsu strategy is driving the improvement in client wins as the Group operates as a unified global network. The Group reiterates FY2024 organic growth guidance of c.1% and c.15% operating margin. 

The company said Japan recorded historical high H1 net revenues with continued recovery in internet advertising with double-digit growth. There is visibility on continued strong growth in H2, supported by improving client win rates. 

Americas has continued its recovery, recording a number of new client wins. Momentum in the region continues with a return to growth expected in the second half. EMEA saw a significant easing of comparables vs Q1, together with stronger than expected Media performance in some local markets. 

The strength in Media is expected to continue in the second half. APAC continues to focus on long term recovery within the region, with full-year performance in line with internal expectations. Dentsu’s BX (Business Transformation) offering, supporting the business and growth transformation of clients, will be extended out of Japan to deliver services such as business strategy consulting, sales transformation, culture and sustainability consulting.

Additionally, Dentsu Lab, the Groups’ Creativity and Innovation proposition will be expanded globally. In the second half of 2024, focus remains on the continued improvement in organic growth, delivering solutions that connect brand potential to business impact to support our clients’ growth.

The group’s APAC organic revenue decreased by 6.2% in Q2 and by 6.6% in the first half of the year. The agency said that in APAC excluding Japan, organic growth rate improved from the first quarter, despite client losses from last year continuing to impact results. In the media, the East Asian region is performing well, particularly in Thailand and Indonesia, our ability to build strong relationships with local clients has led to stable performance. Creative reported largely steady spending by large clients, with increment of client spend in sectors such as automotives.

“CT&T continues to face challenging conditions, with client losses in Australia. There are some encouraging signs including positive organic growth in all practices in India after a long period of underperformance, as client loss have bottomed out. China is performing better than internal expectations. In the second half of the year, we will focus on strengthening cross-selling across the region as we roll out the One Dentsu strategy in the region and continue to expect results to be in line with initial forecasts,” said Dentsu.