Embattled agency network Dentsu has suffered a 3.7% organic drop in net revenue to £1.5 billion across the first quarter of 2024, which the firm claims is “in line with internal expectations”.
Despite registering a strong performance in its home Japanese market, Dentsu posted an alarming 9.4% decline in organic revenue for the EMEA region (a drop of 4.2% net revenue), with the market now accounting for just a fifth (20%) of the group’s overall business.
Accounting for 43% of its business, Dentsu’s 2.4% growth in organic revenue (2.3% net revenue) in Japan will no doubt prove cause for optimism, although this will be further dampened by a 6.6% organic revenue drop in North America, which accounts for more than a quarter (28%) of the agency’s business.
This news will hardly prove promising for the Tokyo-based outfit, which posted meagre overall net revenue growth of 1.6% in its annual results in February after a challenging 2023.
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“The first quarter delivered an organic revenue decline of 3.7%, in line with our internal forecasts and leaving us on track to deliver our guidance of circa 1% organic growth for the full year 2024,” Dentsu Group president and global chief executive, Hiroshi Igarashi said.
“Our confidence comes from a stronger outlook in the second half of the year. The group will benefit from momentum in client wins, yet to impact revenues, from cycling out of accounts lost in 2023 and a significant easing of comparables.”
Following on from this latest trading update, Dentsu has once again reiterated its forecast of stagnant 1% growth across it global business for 2024, with a margin guidance of around 15%.
