Emily Tan
Feb 14, 2018

Dentsu Aegis Network posts record 17.1% growth on the back of new business

Asia-Pacific, excluding Japan, showed a slight decline in gross profit growth and contributed 25% of the group's gross profit.

Toshihiro Yamamoto
Toshihiro Yamamoto

Dentsu Aegis Network posted gross profit growth of 17.1% thanks to record new business wins totalling $5.2 billion.

Dentsu Group's international arm, the parent of Carat and Mcgarrybowen, topped Recma's new business league thanks to this strong performance.

DAN's success is expected to drive above-average organic growth for the group in FY2018 and underpinned Dentsu Group's gross profit growth of 9.2% to ¥877.62 billion ($8.15 billion).

In the past year, Dentsu Group's net profit grew 26.3% to ¥105.48 billion ($980 million).

DAN's growth is also attributable to M&A activity. DAN made a total of 31 acquisitions and investments in the past year. Factoring this out, in terms of organic gross profit, DAN grew only 0.4% in the past year.

Regionally, Asia-Pacific, excluding Japan, showed a slight decline in gross profit growth of 0.6% and contributed 25% of the group's gross profit. 

In the region, DAN credited Australia with strong performance while China remains challenging. "Recent management changes in China will strengthen our position going forward," the group promised.

The EMEA region delivered organic gross profit growth of 3.1% over the year, accounting for 35% of the group's gross profit. 

This is despite a "diffcult end to the year" for some of DAN's largest European markets. "This was offset by robust performances from Russia, Italy, Denmark and Sweden", said the statement. 

The Americas contributed 40% of DAN's gross profit but posted a drop of 1.5% for the year. While the US market showed positive organic gross profit in the fourth quarter, Brazil was a drag on the region's overall performance, the statement said. 

In terms of strategy, DAN will continue to invest heavily in its data capabilities. Toshihiro Yamamoto, president and chief executive of Dentsu, said: "Dentsu Aegis Network continues to invest in data capabilities. The M1 platform is a key pillar of our data strategy and is the first phase in realising our vision for all media planning and activation to be people based. FY2018 will see the rollout of the M1 platform outside of the US."

Source:
Campaign UK

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