Companies‎ > ‎US Research‎ > ‎

Interpublic Group of Companies (NYSE: IPG) | Company Profile, History, Competitors

 

Interpublic Group of Companies (NYSE: IPG) is one of the largest advertising and marketing firms. It is one of the big four firms, which includes IPG, WPP, Publicis and Omnicom. The company was founded in 1930 and headquartered in New York, NY.

The company was founded as McCann-Erickson in 1930 and renamed Interpublic Group in 1961. In 2002, IPG suffered an accounting scandal and was alleged in violation of the Securities Exchange Act. In 2005, Michael Roth took over as CEO and simplified the operating structure. IPG provides advertising, branding and marketing solutions to companies through its network of advertising agencies.

Business Overview

IPG operates in two main segments.
  • Integrated Agency Network (81% of 2017 Revenues): Includes IPG's three largest advertising networks (McCann Worldgroup, FCB, MullenLowe). IPG Mediabrands, digital agencies, and domestic integrated brands.
  • Constituency Management Group (19% of 2017 Revenues): Includes IPG's specialist marketing agencies that offer public relations, event production, sports marketing, corporate branding and strategic marketing.

Integrated Agency Network Segment

IPG's Integrated Agency Network segment consists of three large advertising networks:
  • McCann Worldgroup: The largest of the three advertising networks. Headquartered in New York, NY. The current CEO is Harris Diamond. Major clients include AmericanAirlines, Coca Cola, General Motors, GSK, Intel, Kraft, Sony and Unilever. McCann Worldgroup was created as the merger of McCann and Erickson in the early 1900s. McCann operates in over 100 countries.
  • FCB: Headquartered in Chicago, IL. The current CEO is Carter Murray. Major clients include Abbvie, Amgen, Boeing, Brown-Forman, Del Monte, Dow, Haier, HP, Johnson & Johnson, Merck, Nestle, Novartis, Royal Caribbean and Volkswagen.
  • MullenLowe: Headquartered in London, UK. The current CEO is Alex Leikikh. Major clients include Ikea, Microsoft, Nestle, Volkswagen and Unilever.
The IPG Mediabrands subdivision focuses on digital services including display, mobile, search, social and video applications. IPG helps their clients buy digital media advertising. The digital agencies subdivision has two digital agencies including R/GA and Huge. The domestic integrated brands subdivision has several advertising agencies including Hill Holiday, Carmichael Lynch and Martin Agency.

Constituency Management Group Segment

IPG's Constituency Management Group segment focuses on public relations, sports marketing and brand development. The companies included are Cassidy & Associates, DeVries, Weber Shandwick, Golin Harris, Jack Morton and Octagon.

History

IPG was founded as McCann-Erickson in 1930. In 1961, it was renamed Interpublic Group. In the 1980s, IPG made a series of acquisitions including Lintas International, Lowe Group and Western International Media. In 2001, IPG acquired True North Communications. 

In 2002, IPG suffered an accounting scandal and was alleged in violation of the Securities Exchange Act. IPG restated its financials for 2002 to 2004. In 2005, Michael Roth took over as CEO and simplified the operating structure. 

Management*

Michael Roth (CEO): Michael Roth serves as CEO since 2005. Prior, he was Chairman and CEO of The MONY Group, a financial services company specializing in life insurance.

Frank Mergenthaler (CFO): Frank Mergenthaler serves as CFO since 2005. Prior, he was CFO of Columbia House and worked at Seagram. He was also a partner in the Entertainment and Media Practice at PriceWaterhouse Coopers.

Financials

 $ USD in millions     2013     2014  2015  2016  2017
 Revenues  $7,122  $7,537  $7,614  $7,847  $7,882 
 Operating Profit  $598  $788   $875   $941   $974 
 Net Income $259  $477  $455   $609   $579 
 EPS $0.62  $1.14  $1.11  $1.53  $1.49