Omnicom Group Inc.

Welcome to the Omnicom second quarter 2022 earnings release conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. To participate, please press 1, then 0. And if you need assistance during the call, please press star, then 0. As a reminder, this conference call is being recorded. At this time, I'd like to introduce you to your host for today's conference, Senior Vice President of Investor Relations, Gregory Lundberg. Please go ahead.

Thank you for joining our second quarter 2022 earnings call. With me today are John Wren, Chairman and Chief Executive Officer, and Phil Angelastro, Executive Vice President and Chief Financial Officer. On our website, omnicomgroup.com, we've posted a press release along with a presentation covering the information we'll review today, as well as a webcast of this call. An archived version will be available when today's call concludes. Before we start today, I'd like to remind everyone to read the forward-looking statements non-GAAP financial and other information that we've included at the end of our investor presentation. Certain of the statements made today may constitute forward-looking statements, and these statements are our present expectations. Relevant factors that could cause actual results to differ materially are listed in our earnings materials and in our SEC filings, including our 2021 Form 10-K. During the course of today's call, we will also discuss certain non-GAAP measures. You can find the reconciliation of these to the nearest comparable gap measures in the presentation materials. We will begin the call with an overview of our business from John, and then Phil will review our financial results for the quarter. After our prepared remarks, we will open up the line for your questions. I'll now hand the call to John.

Thank you, Greg. Good afternoon, everyone, and thank you for joining us today. We're pleased to share our second quarter results. Our second quarter performance was very strong. We exceeded our expectations with organic growth of 11.3%, which was broad-based across our agencies, disciplines, regions, and client sectors. Operating profit margin for the quarter was 15.2%, 70 basis points higher than our comparable margin in 2021. our agency management teams continue to grow their top line while closely managing costs in line with revenue. Earnings per share for the quarter was $1.68, up 15.1% versus the comparable amount in 2021. Finally, our cash flow, liquidity, and balance sheet remain very strong, and we continue to support our primary uses of cash. dividends, acquisitions, and share repurchases. Phil will cover our results in more detail during his remarks. During the quarter, we continue to focus on evolving our existing capabilities to meet the needs of our clients and prospects. Most notably, we expanded and strengthened our e-commerce and retail media capabilities. At the Cannes Lion Festival of Creativity in June, we announced a number of first of its kind e-commerce collaborations with Amazon, Instacart, Kroger, and Walmart. We now have more than 1,500 certified experts helping our clients navigate the complexity of executing media and driving sales on retail media platforms. The commerce partnerships we recently announced will provide us with additional access to online and in-store transactions and audiences so we can deliver more precise and actionable consumer insights, more effective creative ideas and content, and more targeted media for our clients. We are delivering these services by leveraging the power of our Omni platform. We have developed OmniCommerce, which integrates data about audiences, shopper behavior, media, content, shelf analytics, sales, and inventory. Omnicommerce enables us to maximize brand awareness and increase the effectiveness of our clients' retail media investments, driving product sales and profitability. We're pleased to see our efforts in this critical area being recognized in a recent Forrester report, which noted that Omnicom Media Group leads across our peer set in retail and commerce media, audience intelligent capabilities, optimization, and operations automation. Going forward, we will continue to invest organically and through acquisitions in e-commerce and retail media, as well as in our other growth areas, including performance media, CRM and precision marketing, digital transformation and MarTech consulting, and the health sector. As we continue to expand the capabilities of Omni, we're maintaining our privacy-first approach in how we aggregate and manage data on behalf of our clients and partners. To oversee these efforts, we recently appointed Brian Clayton as Omnicom's Chief Data Privacy Officer. Brian has an extensive background in data privacy that incorporates data ethics, governance, and protection. He will be a key member of our team as we continue to protect the privacy and security of the data we manage. Clients are rightfully demanding greater insight and control over their data as third-party cookies come to an end and as increasingly complex data privacy laws and regulations emerge around the globe. Our approach is to ensure that we have Omnicom-wide privacy practices, frameworks, and programs that safeguard the security of client data, employee data, and data we obtain from third-party partners. Continuing with some key leadership additions, I'm pleased to announce the appointment of Matt McNally as CEO of Omnicom Health Group. He succeeds Ed Weiss, who recently announced his retirement. Christina Hansen was named U.S. CEO of OMD. Chrissy has served as the network's global chief strategy officer since 2018. She succeeds John Osborne, who, after more than 30 years with Omnicom, is stepping back to focus on his longstanding work with nonprofit organizations. In June, we attended the Cairns Lions, Omnicom agencies from more than 30 countries won over 120 lines. Two of our creative networks, DDB and BBDO, placed in the top five in the Network of the Year competition. In media, OMD won Media Network of the Year, which was followed by a recent report from Forrester naming Omnicom Media Group as having the strongest current offering in the marketplace. Congratulations to all our agencies and people on their exceptional performance. DE&I continues to be a top priority for us, and during the quarter, we issued our diversity, equity, and inclusion performance report. I encourage our people and stakeholders to read the report on our website and know we are committed to keep building on our progress moving forward. Overall, we are very pleased with our progress on our key strategic initiatives and our first half financial results. Our notable new partnerships and continued investments in high growth areas position us extremely well to service our clients now and in the future. While we remain competent in our strategies and execution, we're retaining a healthy level of caution due to the existing macro factors, including the ongoing war in the Ukraine, the effects of the pandemic across markets, the continuing disruption of global supply chains, and the economic risks posed by higher inflation and rising interest rates. Even with this backdrop, we are continuing to see strong demand for our services, and based on our first half results, are increasing our organic revenue growth forecast to between 6.5% to 7% for the full year 2022. We also continue to anticipate delivering the same strong operating margin of 15.4% in 2022 that we delivered in 2021. Before I finish, I'd like to address the ongoing challenges our people are facing around the globe. The war in the Ukraine continues to impact the lives of our colleagues and their families in the Ukraine and is having an effect on our people around the world. We remain steadfast in supporting them for as long as needed. In the US, we continue to encounter mass shootings, senseless acts of gun violence and racially motivated hate crimes. My heart goes out to the families of the victims of these crimes. Finally, the Supreme Court's decision to overturn Roe v. Wade was a step back in the advancement of women's rights and is having a detrimental effect on many of our colleagues. We're committed to ensuring our people have equal access to health services, no matter where they live in the United States. Our actions with respect to the Ukraine war and the recent Supreme Court decisions reflects our commitment to always put the safety and well-being of our colleagues first. I will now turn the call over to Phil for a closer look at our financial results. Phil. Thanks, John.