Omnicom Reports Fourth Quarter and Year-End 2002 Results

NEW YORK, Feb. 25 /PRNewswire-FirstCall/ -- Omnicom Group Inc. (NYSE: OMC) today announced that net income for the fourth quarter of 2002 increased 9% to $201.5 million from $185.4 million in the fourth quarter of 2001. Diluted earnings per share increased 10% to $1.08 per share in 2002 from $0.98 per share in 2001.

Effective January 1, 2002, in compliance with SFAS No. 142, the Company ceased recording goodwill amortization. The 2001 amounts were adjusted to assume that the cessation of goodwill amortization occurred on January 1, 2001.

Compared to our previously reported results for 2001, net income for the fourth quarter of 2002 increased 23% from $164.1 million in the fourth quarter of 2001 and diluted earnings per share increased 24% from $0.87 per share.

Worldwide revenue increased 7.5% to $2,118.8 million in the fourth quarter of 2002 from $1,970.5 million in the fourth quarter of 2001. Domestic revenue for the fourth quarter of 2002 increased 8% to $1,153.5 million compared to $1,064.0 million in 2001. International revenue for the fourth quarter of 2002 increased 6% to $965.3 million compared to $906.5 million in 2001.

Net income for the twelve months ended December 31, 2002 increased 10% to $643.5 million from $586.2 million in 2001. Diluted earnings per share increased 10% to $3.44 per share in 2002 from $3.13 per share in 2001. The 2001 amounts were adjusted to assume that the cessation of goodwill amortization occurred on January 1, 2001.

Compared to our previously reported results for 2001, net income for the twelve months ended December 31, 2002 increased 28% from $503.1 million for the twelve months ended December 31, 2001 and diluted earnings per share increased 27% from $2.70 per share.

Worldwide revenue for the twelve months ended December 31, 2002 increased 9.4% to $7,536.3 million in 2002 from $6,889.4 million in 2001. Domestic revenue for the twelve months ended December 31, 2002 increased 15% to $4,284.6 million compared to $3,717.0 million in 2001. International revenue for the twelve months ended December 31, 2002 increased 3% to $3,251.7 million compared to $3,172.4 million in 2001.

Omnicom Group Inc. (NYSE-OMC) (www.omnicomgroup.com) is a leading global marketing and corporate communications company. Omnicom's branded networks and numerous specialty firms provide advertising, strategic media planning and buying, direct and promotional marketing, public relations and other specialty communications services to over 5,000 clients in more than 100 countries.

For a live webcast and/or a replay of our fourth quarter earnings conference call, go to www.omnicomgroup.com/InvestorRelations.

                              Omnicom Group Inc.

                                 (Unaudited)
               (in Thousands of Dollars, Except Per Share Data)

                                                                  Adjusted (a)
                                                                  for Goodwill
                                                  As Reported     Amortization
    Three Months Ended December 31       2002            2001          2001

    Revenue                        $2,118,845      $1,970,473      $1,970,473

    Operating and net
     interest expense               1,793,133       1,681,820       1,657,028

    Income before income taxes        325,712         288,653         313,445

    Income taxes                      104,069         112,452         115,218

    Income after income taxes         221,643         176,201         198,227

    Equity in affiliates/
     Minority interests               (20,169)        (12,060)        (12,838)

    Net income                       $201,474        $164,141        $185,389


    Earnings per share
       Basic                            $1.08           $0.89           $1.01
      Diluted                           $1.08           $0.87           $0.98


    Weighted average
     shares (in thousands)
       Basic                          186,055         183,619         183,619
       Diluted (b)                    186,894         190,652         190,652

    Dividend declared per share        $0.200          $0.200          $0.200

    (a)  Effective January 1, 2002, in compliance with SFAS No. 142, the
         Company ceased recording goodwill amortization.  To present 2001 on a
         comparable basis with 2002, amounts are adjusted to assume that the
         cessation of goodwill amortization occurred on January 1, 2001.

    (b)  Diluted earnings per share for 2002 was calculated using an assumed
         increase in net income of $244,000 related to the after-tax
         compensation expense from dividends on restricted shares.  Diluted
         earnings per share for 2001 was calculated using an assumed increase
         in net income of $2,282,000 related to the after-tax interest cost of
         our 2-1/4% Convertible Debentures and the after-tax compensation
         expense from dividends on restricted shares.  The Company's 2-1/4%
         Convertible Debentures were redeemed in the fourth quarter of 2001.

                              Omnicom Group Inc.

                                 (Unaudited)
               (in Thousands of Dollars, Except Per Share Data)

                                                                 Adjusted (a)
                                                                  for Goodwill
                                                  As Reported    Amortization
    Twelve Months Ended December 31       2002            2001           2001

    Revenue                         $7,536,299      $6,889,406     $6,889,406

    Operating and net
     interest expense                6,462,676       5,994,021      5,899,231

    Income before income taxes       1,073,623         895,385        990,175

    Income taxes                       375,637         352,128        365,145

    Income after income taxes          697,986         543,257        625,030

    Equity in affiliates /
     Minority interests                (54,527)        (40,115)       (38,822)

    Net income                        $643,459        $503,142       $586,208

    Earnings per share
       Basic                             $3.46           $2.75          $3.21
       Diluted                           $3.44           $2.70          $3.13

    Weighted average
     shares (in thousands)
       Basic                           186,094         182,868        182,868
       Diluted (b)                     187,603         190,290        190,290

    Dividend declared per share         $0.800          $0.775         $0.775

    (a)  Effective January 1, 2002, in compliance with SFAS NO. 142, the
         Company ceased recording goodwill amortization.  To present 2001 on a
         comparable basis with 2002, amounts are adjusted to assume goodwill
         amortization ceased on January 1, 2001.

    (b)  Diluted earnings per share for 2002 was calculated using an assumed
         increase in net income of $975,000 related to the after-tax
         compensation expense from dividends on restricted shares.  Diluted
         earnings per share for 2001 was calculated using an assumed increase
         in net income of $9,728,000 related to the after-tax interest cost of
         our 2-1/4% Convertible Debentures and the after-tax compensation
         expense from dividends on restricted shares.  The Company's 2-1/4%
         Convertible Debentures were redeemed in the fourth quarter of 2001.

SOURCE Omnicom Group Inc.

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