Interpublic Q4 Results Beat View; Sets New Stock Buyback Program, Lifts Dividend

(RTTNews) - Advertising and marketing services provider Interpublic Group of Companies, Inc. (IPG) reported a decline in profit for the fourth quarter on slightly lower revenues. However, both revenue and adjusted earnings per share for the quarter beat analysts' estimates.

In addition, the company's board of directors approved a new share repurchase program of up to $300 million and increased the quarterly dividend by 25 percent.

Fourth-quarter net income available to common stockholders was $260.3 million or $0.63 per share, down from $308.9 million or $0.73 per share in the same period last year.

Excluding the impact of the losses on sales of businesses, earnings per share for the quarter were $0.66, compared to $0.57 per share in the year-ago period excluding the impact of the net valuation allowance reversal on deferred tax assets in Continental Europe.

On average, 15 analysts polled by Thomson Reuters expected the company to report profit per share of $0.62 for the quarter. Analysts' estimates typically exclude special items.

Revenue for the quarter edged down 0.5 percent to $2.20 billion from $2.21 billion in the prior-year period. Analysts had a consensus revenue estimate of $2.19 billion.

Organic revenue increased 5.2 percent, comprised of an increase of 4.1 percent internationally and 6.2 percent in the U.S.

Looking ahead to fiscal 2016, Interpublic Group projects organic revenue growth target of 3 percent to 4 percent and a further 50 basis points or better improvement in operating margin, which would bring the company to operating margin performance of 12 percent or greater.

Interpublic's board of directors authorized a new program to repurchase, from time to time, up to $300 million of the company's common stock. The new share program, which is in addition to any amounts remaining for repurchase under the program announced in 2015, will take effect immediately and has no expiration date.

The company's board of directors has declared a common stock cash dividend of $0.15 per share, representing a 25 percent increase from the previous $0.12 per share. The dividend is payable on March 15, 2016 to holders of record at the close of business on March 1, 2016.