* Sees lower 2009 revenue, operating margin
* But expects to outperform global market in 2009
* Says final exposure to GM should be below 55 mln euros
* Expects tough Q2, Q2 to be worse than Q1
(Adds quotes, details, shares)
By Dominique Vidalon
PARIS, June 9 French advertising firm Publicis
(PUBP.PA) expects the global economic downturn to weigh on its
revenue and operating margin this year, but is confident it can
still outpace its rivals, Chairman Maurice Levy said on Tuesday.
Levy, who is also chief executive, told the annual
shareholders' meeting that the group's final exposure to U.S.
client General Motors GMGMQ.PK, which has filed for bankruptcy
protection, would be below 55 million euros ($76.1 million).
Publicis competes with domestic rival Havas EURC.PA, U.S.
advertiser Omnicom Group Inc (OMC.N) and Britain's WPP (WPP.L),
the world's largest advertising group by revenue.
"2009 will not be a great year, a great vintage, but we have
undisputable assets," Levy said, citing strong positions in
emerging countries, the fast-growing digital sector and a sound
Publicis, the world's third largest ad group by revenue,
posted a 4.4 percent fall in first-quarter underlying sales last
month and Levy reiterated on Tuesday that the second quarter
would be worse than the first.
"The second quarter will be the toughest quarter, with an
improvement coming in the second half of the year," he added.
Levy predicted the global ad market would reach a low point
in July, with an upturn in the second half of 2009.
In this environment, Publicis expected to beat a decline of
7-8 percent in the global advertising market this year.
"At this stage we are confident we will do better than the
sector's average and than the top Tier but we do not know by how
much," Levy said when asked to provide a detailed sales outlook.
The group's 2009 operating margin was expected to decline
from last year's record 16.7 percent but a 15 percent cut in
controllable costs would help cushion the drop.
"We will have an erosion of our margin. There is all
likelihood that we will maintain the gap with rivals. I am
confident we can deliver the best sector's margin," he said.
Levy also said Publicis, which had available cash of 2.8
billion euros at end-2008, did not plan any large purchases in
emerging countries because there were none at the moment.
He said Publicis was looking at ways to invest "in a smart
manner" in Germany, a market which is hit hard by the crisis.
By 1230 GMT, Publicis shares were off 0.09 percent at 22.02
euros, outperforming a 0.77 percent decline in the European
media sector .SXMP.
(Editing by David Cowell)