Dentsu reports +4.5% yoy growth in net rev for Q1 FY23
The network says that strong contributions from its recent acquisitions led to the boost in Q1 revenue despite slow organic growth
Dentsu saw negative organic growth and weaker profits in the quarter ended March 31. Organic revenue for the group declined by 1.6%, compared to the corresponding quarter in the previous year. However, the network's recent acquisitions -- Shift7 and Tag -- have boosted the Q1 net revenue, which rose more than 4.5% year-on-year.
In the March quarter, the network's net revenue was close to $2 billion (JPY 269.6 billion).
The global advertising group is now forecasting an organic growth of 1% to 2% for the year, from 4% previously. "The Group continues to expect performance to be second-half weighted driven by a number of one-off events later in the year. Underlying basic EPS guidance of 461 yen is re-confirmed, supported by a reduction in financing costs," read the company's official statement.
Hiroshi Igarashi, President and CEO, Dentsu Group Inc., said: "The first quarter was impacted by a lengthening of the sales cycle for Customer Transformation & Technology contracts in the US, as highlighted in the fourth quarter. A growing pipeline and increase in new business wins in the first quarter provides greater visibility for an improvement in second-half growth.
Our strategy of growing revenues in the fast-growth market of Customer Transformation & Technology is progressing well, with 35% of net revenues generated by CT&T in the first quarter. Our services empower our clients to transform their data, technology, and organizational capabilities to deliver differentiated customer experiences that drive growth."
