Ipsos

Good morning and welcome to our first quarter results for 2025 at Ipsos. And what can one say about the world in 2025? I think just before we look at those numbers from our company, it's worth reflecting on just what is going on, because part of what Ipsos' role is, is obviously to help our clients, business, government, the media, understand public opinion, citizen opinion and consumer opinion all over the world. You can see just by looking at the stock markets, the level of volatility that we're now seeing. There on this chart, indexed to start at a single point at the beginning of the year, you can see how the FTSE, CAC Caron and NASDAQ have diverged and also fluctuated dramatically in response to announcements from Washington about the tariffs. Even before those tariffs were announced, we could see that there were heightened levels of anxiety among consumers, both in Mexico, Canada, America, across Europe, the Middle East and Africa, and also in China, when the majority of people in virtually every country we have surveyed expressing anxiety about what might happen. It's interesting, of course, to see that in terms of personal impacts on the left side on this chart. The Mexicans and Canadians, and I'll come back to the Canadians in a second, are most worried. But half of the population of EMEA and, interestingly, slightly fewer Chinese citizens worried about the impacts of American tariffs before they were announced. We've also seen, of course, that people have reacted to that by changing their views of America and becoming more positive towards China. So over the last 10 years, we've tracked the reputation of a wide range of countries for a number of our clients. And you can see that the UK and France have been broadly stable of around seven out of 10 people globally saying that they're positive towards the impact those countries have on world affairs. But you can see very dramatically the impact of recent announcements in terms of what has happened to the United States' reputation. And for the first time in this series, we've seen that more people around the world now say that China has a positive influence on world affairs than does the United States. And there's Russia before and after its invasion of Ukraine. But interestingly, even Russia has seen some improvement recently. The tectonic plates are moving, and I think that's fundamental. And if you dig into that data, you can see just how dramatic the changes have been in terms of how the Canadians at the bottom of that chart, but also many Western allies of the United States have been in terms of their reactions, their negative reaction to some of the recent announcements around defense, alliances, and indeed tariffs. With all of that going on, we have seen overall growth at Ipsos of 2% in the first three months of the year. The organic growth is slightly negative, reflecting the back end of last year. And of course, remember that this year, as we announced in February, when we reported on 2024, is going to have a profile of revenue recognition that is more similar to what we saw in our 2023 numbers than last year. So we expect to see a gradual strengthening through the year. And in fact, the order book confirms that. Those numbers there of 2% growth are made up, of course, of that negative 1.8% organic, a 2.9% increase overall because of scope effects and positive currency effects from the dollar before, in Q1, the tariffs were announced. The scope effects, of course, driven partly and mainly by the acquisition of Infas in our numbers. So, overall, these numbers are in line of our expectations, and we can see visibility... a positive visibility for the rest of the year. Other things going on at Ipsos, I think a key thing of course is one of the largest acquisitions that we've done in the last few years, which is our exclusive negotiations we've now begun to acquire BVA. That consolidates our position in France as the leading researcher in the country. It strengthens our position in the UK and also in Italy. particularly in customer experience research, in mystery shopping and in public affairs. Doxa in Italy is a great brand, BVA in France. We also, of course, get PRS in vivo, which is a leading global business in pack testing, which is very important for our innovation business. And they bring to us also expertise in luxury, which is a key area, consumer goods, and also behavioral sciences. So overall, we think that this is something that we can work very, very well with. It brings revenue of around 160 million euros. And what we plan to do over the next 18 to 24 months, I mean, it's already making a profit, but we will work with the teams there to mutualize our costs. And over the next 18 to 24 months, get their margins up to Ipsos levels. So a positive development, we think, and very good to see that happening. I'll now hand over to Dan Levy to talk through a little bit more of the detail behind the headline numbers. Dan.

Thank you very much, Ben. So the first quarter's results show a performance which is in line with our expectation. As we said a few months ago, the profile of 2025 was very much going to be lower growth at the beginning of the year and then improvement during the course of the year, both because of the comparative effect and particularly in EMEA and in Asia, where we have very tough comparative effect in Q1 2024. and as much as the measure taken by the new management in the United States, Burr Fruit. So if we look at the breakdown by region, EMEA show a total growth of more than 6%, which is mainly driven by the integration of INFAS. Organic growth is flat in EMEA, which reflects Good results in continental Europe, but also on the other hand, a sharp decline in our public affairs business, both in France and in the United Kingdom, mainly driven by the electoral cycle. And obviously, as I said before, because of the comparative effect, we grew by nearly 10% in Q1 2024 in EMEA. We are down in America by 1.7%, which is actually encouraging given the performance of 2024. The new management in the US is now fully in place and fully operational. Other service lines than public affairs are performing better, actually, with an overall organic growth of more than 2%, which is mainly supported by the demand from our consumer goods clients. However, public affairs is still in sharp decline, affected obviously by the uncertain and quite unpredictable political context in the US. And finally, the region Asia-Pacific is down, impacted by the lack of recovery in China and also by a slowdown in activity with certain major clients, international clients and government in Asia, as well as again a strong base effect comparison with Q1 2024. If we now turn to the performance by audience, our service lines dedicated to consumers, clients, and employees are stable and reflect a sustained demand from CPG clients globally. Again, this has to be compared with a very strong performance in Q1 2024. We have strong performance in our service line focused on marketing spend optimization, on market positioning, and on advertising campaigns measurement. Our citizens' business is down by 40%, so a sharp decline, mainly because of a wait-and-see attitude by governments in the context of global and local political instability, particularly in the US, and also driven by electoral cycles, both in France and in the United Kingdom. In France and in the UK, we start seeing resuming discussions with departments, and so we think that the situation will be improving within the next few months. The doctors and patients audience is performing well in Q1. Organic growth by more than 5%, as you can see on the chart. The demand from the big pharma seems to be picking up in Q1. We believe that now the post-COVID restructuring are behind us and there is growing demand on innovations, on oncology, on very rare disease, on anti-obesity treatment and GLP-1 molecules. That said, the recent decisions from the US administration to do some layoffs at the FDA plus the price policy for drugs from the US administration might impact the sector. And so we remain cautious about the outlook for the healthcare business in 2025. And finally, we see a very good performance from our DIY platform, Ipsos Digital, which is growing in Q1 by more than 30% organically, and we target 140 million in 2025. So now over to Ben for more business highlights.

So yes, briefly, I wanted to take you through what we're doing on the deployment of AI, which is now becoming a routine tool for a very large majority of our people. Three quarters of our people at Ipsos are already AI certified, and they've gone through a detailed training, looking at the options for different platforms. Our different businesses now have their own prompt libraries and knowledge companion, which allows them to mine our internal data in a safe, secure environment. And overall, six out of 10 people are using it all the time. And that's hugely important in driving both productivity, but most importantly, more speed in delivery and the ability, of course, to do things that were not possible before the arrival of these large language models. And one example of that is the application of synthetic data. This, of course, is something that we have always done in the industry and at Ipsos, the imputation for missing values. But now, of course, we can do this with much more accuracy and much more speed. So you're augmenting data with missing respondents. Certain groups might be in short supply in a sample, and you may be able to impute what they would have said, merging different samples with data fusion. And then, of course, the new things that AI is enabling us to do, the creation of synthetic respondents. So based on, of course, large volumes of data. So things like our persona box, where you're able to convert, we're able to create a synthetic individual for you to ask questions of about data. And of course, the creation of synthetic panels where they're based, of course, on large volumes of data and our ability as one of the leading players in this industry to marshal huge volumes of historic data that we own is very, very important in this context. But, of course, they offer the ability, again, to dramatically increase speed. So we're working with Stanford University there to really boost our expertise in this area, building on their own machine learning experience. And we can already see that in some areas we can get a 98% match between the synthetic data that we're testing against real world evidence. And I think it's very, very promising. At the same time, We want to be very sensible and cautious about how we apply it in the real world and we're not putting anything out that would not have the same levels of quality and reassurance that we would apply to offline data or data connected from real consumers. So important development and one that we intend to continue investing in and focusing on. And just to give you an example of how that might work, this is a real-life example from the UK, from Motability, which is a very large provider of vehicles to people with disabilities. We run there a community of 7,000 customers of that organisation, and we understand from that, of course, a lot about their demographics, their underlying attitudes and their needs. What we've done here is create a pilot with 50 synthetic respondents, AI twins of real people, which we can then assess communications with using behavioral science to understand, in this example, how people are reacting to the arrival of electric vehicles and what the challenges are for disabled people in particular in terms of electric vehicle adoption. And this takes down the need to spend sometimes weeks on research in the past down to literally one or two days. So just one example. Another, of course, is the work that we've been doing with our clients at L'Oréal. Here we're using AI to understand billions and billions of tweets, blogs and posts with our Signals GenAI web listening solution to very quickly mine that data to understand what is driving concern or interest in particular products. And as L'Oréal themselves put it at their innovation day and at one of our industry's largest conferences, the SMR conference last year, this actually would have saved them one year in terms of their understanding of mental health and its relationship to beauty products and product development so just an example of the speed that ai now gives us to do things that were literally virtually not possible beforehand and i you know it's very very interesting to see people acknowledging the power of some of the tools that we've now deployed and of course over the last year we've rolled out at least 12 of these new services and another one that i can tell you about today is the launch of our customer experience persona bot. We've already produced these in our pharma business, and you've seen some positive results there. But here you can talk to, again, an AI model which brings to life different types of consumers, so they can understand what they need very, very quickly, brainstorm and test solutions literally in real time using the Ipsos Facto GenAI platform. So we will continue to roll out persona bots. for our clients to use, but also, of course, for our own people to use in interrogating data and speeding up the research process generally. And so it's great to see those being deployed across the company. And then, of course, finally, we're not just working on AI. We're also continually developing new services and solutions. And one I thought it was worth talking about today is the Influencers Impact Assessment. Now, as you will know, in marketing terms, influencers themselves are now becoming a vital part of how our clients go to market rather than communicating directly using influencers. But of course, which influencers are most relevant and most effective for which brands and on which channels? This tool allows our clients to understand that. It uses advanced analytics to understand how their influencers that they're paying are performing compared to competitor influencers. We can see the ones that are worth spending money on by looking at the engagement levels, by looking at the brand, the closeness to our clients' brands. We've launched this in the Middle East. We will then roll it out globally. So lots and lots of activity on AI. and continual innovation. And of course, that's one of the reasons why we are regularly chosen by our clients as the most innovative full-service research agency in the world. So with the world in an uncertain place, what can we see? What's the outlook for the rest of 2025? Sitting here in mid-April, we are saying that we can see organic growth continues to be above 2024 in terms of what we can say for the year as a whole. And we can also say that we hold our guidance on our operating margins around 13% for our constant scope. I think Arthur at Publicis says, and I think we can say the same thing, clients are being measured in how they're reacting to a very uncertain environment. And we know that research at times like this is, if anything, even more important. We're seeing record levels of attendance by clients at our various events because of course in an uncertain environment you need to understand what's going on and any piece of information becomes important and so we are aiming to provide that regularly for our clients. Do look at our understand and to know the new America series that we've now produced to really help people all over the world understand what's going on inside the United States. So we will talk to you again at our AGM on the 21st of May. We will have our half-yearly results in July, and we will update you later this year on our overall longer-term plans. But thank you very much for listening, and very happy now to take any questions.