Dentsu – not just big in Japan as group focuses on international markets, digital
Tokyo based communications group Dentsu Inc., which recently completed a deal to acquire Aegis Group, has released its 2012 financial report.
The group posted 1,941.2 Billion Yen in Consolidated Billings (Net Sales) (2.5% year-on-year increase), 58.4 Billion Yen in Operating Income (12.5% increase), 59.0 Billion Yen in Ordinary Income (6.1% decrease) and 36.3 Billion Yen in Net Income (22.9% increase). It recorded a gross profit of 345,940 million yen, an increase of 3.9%
Dentsu reports a gradual recovery in the Japanese advertising market following the Great East Japan Earthquake of 2011, but continued uncertainty in Europe and a slow-down in China. Dentsu’s estimate for advertising expenditures in Japan for the 2012 calendar year was 5,891.3 billion yen, an increase of 3.2% compared with the 2011 calendar year – the first increase in five years.
For the fiscal year ending March 31, 2014, on a consolidated basis, Dentsu forecasts billings (net sales) of 2,283.4 billion yen, an increase of 17.6% year on year; gross profit of 571.8 billion yen, an increase of 65.3%; operating income before amortization of goodwill and intangible assets of 100.1 billion yen; operating income of 58.5 billion yen, an increase of 0.1%; ordinary income of 58.7 billion yen, a decrease of 0.6%; and net income of 19.1 billion yen, a decrease of 47.4%.
Dentsu has established a medium-term management plan for the group which starts from financial year 2013 and goes through to financial year 2017. It aims to achieve an annual organic growth rate in gross profit of 3–5%, to improve the ratio of gross profit generated from markets outside of Japan to reach 55% or higher, the ratio of gross profit generated from digital businesses to reach 35% or higher and an operating margin before amortization of goodwill and intangible assets of 20% or higher.