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Omnicom Group Annual Report (Amendment), Year Ended Dec 31, 1993

Filing Date
Filed February 7, 1995
Period End
December 31, 1993
Security
OMC
In the record · 2016–202610-K1110-Q338-K107

OMC filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 107 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Jul ’17Jul ’17
  2. Material agreement8-K · Jul ’19Jul ’19
  3. Leadership change8-K · Feb ’22Feb ’22
  4. Material agreement8-K · Dec ’25Dec ’25

01—Abstract

Summary

Summary of the 10-K/A filed February 7, 1995. Cited figures are marked; the original filing is the authoritative source.

Omnicom Group Inc. filed this Amendment No. 1 to its Form 10-K for the fiscal year ended December 31, 1993, dated February 7, 1995, which amends Item 14 to include Note 8 (Income Taxes) to the consolidated financial statements.

The filing presents the company's 1993 financial statements, audited by Arthur Andersen & Co., whose report is dated February 22, 1994 and is unqualified. Commissions and fees rose to $1,516.5 milliona in 1993 from $1,385.2 million in 1992, and operating profit increased to $169.2 million from $146.4 million. Net income was $85.3 million, or $2.79 primary and $2.62 fully diluted per share, compared with $69.3 million in 1992.

The company reported an effective income tax rate of 42.0% for 1993, against a statutory federal rate of 35.0%. The balance sheet expanded over the year. Total assets were $2,289.9 millionb at December 31, 1993, up from $1,951.9 million, and shareholders' equity increased to $402.2 million from $308.9 million.

Cash and cash equivalents reached $174.8 millionc, and long-term debt was $278.3 million. Net cash provided by operating activities was $209.2 million in 1993, compared with $181.7 million in 1992. Much of the equity growth reflected the conversion of $85.9 million of 7% Convertible Subordinated Debentures into 3,334,079 common shares during 1993.

Acquisition activity was significant in 1993, with aggregate acquisition cost of $132.8 milliond, including intangible assets of $149.7 million. The company also completed its acquisition of TBWA International B.V. in May 1993, accounted for as a pooling of interests. The filing states that adoption of SFAS No. 112 effective January 1, 1994 is estimated to reduce net income by approximately $27 million after tax.

02—Key points

Key Highlights

  1. Commissions and fees were $1,516.5 million in 1993, up from $1,385.2 million in 1992 and $1,236.2 million in 1991.
  2. Net income was $85.3 million in 1993 ($2.79 primary and $2.62 fully diluted per share), compared with $69.3 million in 1992.
  3. Total assets were $2,289.9 million and shareholders' equity was $402.2 million at December 31, 1993.
  4. Net cash provided by operating activities was $209.2 million in 1993, versus $181.7 million in 1992.
  5. The effective income tax rate was 42.0% in 1993, compared with the 35.0% statutory federal rate.
  6. Acquisitions totaled $132.8 million in 1993, including $149.7 million of intangible assets; contingent payments related to prior-year acquisitions were $16.2 million.
  7. SFAS No. 112 adoption effective January 1, 1994 is estimated to reduce net income by approximately $27 million after tax.

03—Questions

Frequently Asked Questions

  1. How did Omnicom's revenue and profitability change in 1993?

    Commissions and fees increased to $1,516.5 million in 1993 from $1,385.2 million in 1992. Operating profit rose to $169.2 million from $146.4 million, and net income increased to $85.3 million from $69.3 million.

  2. What was the company's effective tax rate and why did it differ from the statutory rate?

    The effective income tax rate was 42.0% in 1993, compared with the 35.0% statutory federal rate. The reconciliation in the filing attributes the difference mainly to state and local taxes (3.0%) and non-deductible amortization of goodwill (3.9%).

  3. How did the company's capital structure change during 1993?

    Holders of the 7% Convertible Subordinated Debentures converted $85.9 million of debentures into 3,334,079 common shares, and shareholders' equity rose to $402.2 million from $308.9 million. Long-term debt was $278.3 million at year-end, including $143.75 million of 4.5%/6.25% Step-Up Convertible Subordinated Debentures issued in the third quarter.

  4. What acquisitions did Omnicom make in 1993?

    Several acquisitions in 1993 had an aggregate cost of $132.8 million, including intangible assets of $149.7 million. The company also completed the acquisition of TBWA International B.V. in May 1993, accounted for as a pooling of interests.

  5. What accounting change is expected to affect future earnings?

    Effective January 1, 1994, the company will adopt SFAS No. 112, Employers' Accounting for Postemployment Benefits, which the company estimates will result in an unfavorable after-tax effect on net income of approximately $27 million.

04—Continue

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