a51951pix.htm - Generated by SEC Publisher for SEC Filing

Revenue $ 3,944.5 $ 3,852.9 2.4% $ 14,219.4 $ 13,872.5 2.5% EBITA ^(a)573.9 511.1 12.3% 1,905.3 1,762.5 8.1%

(a) EBITA is a non-GAAP financial measure. See page 26 for the definition of this measure and page 19 for the reconciliation of non-GAAP measures.

(a) Our effective tax rate for 2012 decreased to 31.8%, compared to 32.7% for 2011. In the fourth quarter of 2012, income tax expense was reduced by $53 million, primarily resulting from a reduction in the deferred tax liabilities for unremitted foreign earnings of certain of our operating companies located in the Asia Pacific region, as well as lower statutory tax rates in other foreign jurisdictions. In an effort to support our continued expansion and pursue operational efficiencies in the Asia Pacific region, we completed a legal reorganization in certain countries within the region. As a result of the reorganization, our unremitted foreign earnings in the effected countries are subject to lower effective tax rates as compared to the U.S. statutory tax rate. Therefore we recorded a reduction in our deferred tax liabilities to reflect the lower tax rate that these earnings are subject to. In future periods we expect an ongoing annual reduction in income tax expense of approximately $11 million. The reduction in income tax expense was partially offset by a charge of approximately $16 million resulting from U.S. state and local tax accruals recorded for uncertain tax positions, net of federal income tax benefits. We expect that on an ongoing basis our effective tax rate will be 33.6%.

(b) In the first quarter of 2011, we recorded an aggregate pre-tax charge of $7.9 million, consisting of a gain of $123.4 million related to a non-cash remeasurement gain, and repositioning charges of $131.3 million. The tax effect of these items was a net benefit of $36.7 million. This was partially offset by a tax charge of $9.0 million related to a tax accrual recorded in accordance with ASC 740 (FIN 48) during the first quarter of 2011. The after-tax effect of these items increased Net Income by $19.8 million and reduced our effective tax rate.

(c) In the fourth quarter of 2012, we recorded an impairment charge of $29.2 million related to an equity method investment in Egypt.

Net Income - Participating Securities (7.2) (3.5) (22.5) (10.7) Net Income Available for Common Shares $ 299.9 $ 268.4 $ 975.8 $ 941.9

(a) To calculate the FX impact, we first convert the current period’s local currency revenue using the average exchange rates from the equivalent prior period to arrive at constant currency revenue. The FX impact equals the difference between the current period revenue in U.S. dollars and the current period revenue in constant currency.

(b) Acquisition/Disposition revenue is the aggregate of the applicable prior period revenue of the acquired businesses. Netted against this number is the revenue of any business included in the prior period reported revenue that was disposed of subsequent to the prior period.

(c) Organic revenue is calculated by subtracting both the acquisition revenue and the FX impact from total revenue growth.

Advertising $ 1,934.9 4.6% 5.4% Advertising $ 6,762.8 4.6% 6.6% CRM 1,368.7 -2.3% -1.6% CRM 5,122.5 0.2% 2.3% PR 347.9 10.5% 8.4% PR 1,290.8 4.9% 3.3% Specialty 293.0 2.0% 0.1% Specialty 1,043.3 -2.1% -2.3%

(a) “Organic Growth” reflects the year-over-year increase or decrease in revenue from the prior period, excluding the FX Impact and Acquisition/Disposition Revenue, as defined on page 4.

$ Mix $ Growth $ Mix $ Growth United States $ 2,026.6 $ 97.9 United States $ 7,363.7 $ 315.0

Euro Currency Markets 659.6 -8.8% -3.7% Euro Currency Markets 2,311.9 -10.4% -1.8%

United Kingdom 343.1 4.5% -0.7% United Kingdom 1,255.1 2.3% 1.5% Rest of World 915.2 4.9% 4.4% Rest of World 3,288.7 9.0% 9.0%

(a) “Organic Growth” reflects the year-over-year increase or decrease in revenue from the prior period, excluding the FX Impact and Acquisition/Disposition Revenue, as defined on page 4.

Financial 9% Services Financial Services -6.0% Services 9% Retail 9% Pharma & Retail -1.3%

Additional information regarding our cash flows can be found in our condensed cash flow statement on page 18.

(a) The Free Cash Flow amounts presented above are non-GAAP financial measures. See page 26 for the definition and page 20 for GAAP reconciliation. (b) 2012 figures include a $29.2 million non-cash impairment charge on an equity method investment in Egypt.

Capital Expenditures 226.3 185.5 Acquisitions and Payments for Additional Interest in Controlled Subsidiaries including Contingent Purchase Price Payments, net of 188.3 447.6 Proceeds from Sale of Investments Stock Repurchases, net 832.0 701.1

Primary Uses of Cash ^(a)1,742.8 1,704.6 Net Free Cash Flow ^(a)$ (316.7) $ (457.3)

Additional information regarding our cash flows can be found in our condensed cash flow statement on page 18.

(a) The Free Cash Flow, Primary Uses of Cash and Net Free Cash Flow amounts presented above are non-GAAP financial measures. See page 26 for the definition of these measures and page 20 for the reconciliation of non-GAAP measures.

(b) In November 2012, the Company declared that its fourth quarter 2012 dividend was to be paid in December 2012. As a result, there were five dividend payments in 2012 compared to four payments in 2011. The Company expects that there will be three payments in 2013.

Gross Interest Expense 179.7 158.1 EBITDA / Gross Interest Expense 11.6 x 12.3 x Total Debt / EBITDA 2.1 x 1.6 x Net Debt ^(b)/ EBITDA 0.8 x 0.7 x

Bank Loans (Due Less Than 1 Year) $ 6 $ 10 CP & Borrowings Issued Under Revolver - -Convertible Notes ^(c)660 660 Senior Notes ^(c)3,750 2,500 Other Debt 39 23

(a) EBITDA is a non-GAAP financial measure. See page 26 for the definition of this measure and page 19 for the reconciliation of non-GAAP measures. (b) Net Debt is a non-GAAP financial measure. See page 26 for the definition of this measure.

(a) Return on Invested Capital is After Tax Operating Income (a non-GAAP measure – see page 26 for the definition of this measure and page 20 for the reconciliation of non-GAAP measures) divided by the average of Invested Capital at the beginning and the end of the period (book value of all long-term liabilities and short-term interest bearing debt plus shareholders’ equity less cash, cash equivalents and short term investments).

(b) Return on Equity is Net Income for the given period divided by the average of shareholders equity at the beginning and end of the period.

Omnicom’s Revenues and Net Income has doubled since 2002^(a). From 2002 through 2012, Omnicom distributed over 99% of Net Income to shareholders through Dividends and Share Repurchases.

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Cumulative Dividends Paid

Cumulative Cost of Net Shares Repurchased, defined as payments for repurchases of common stock less proceeds from stock plans Cash Returned to Shareholders, defined as the sum of Cumulative Dividends paid and Cumulative Cost of Net Shares Repurchased Cumulative Net Income - Omnicom Group Inc.

(a) Omnicom Revenue increased from $6.9 billion to $14.2 billion and Net Income increased from $455 million to $998 million in 2001 and 2012, respectively.

Supplemental Financial Information

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Omnicom Debt Structure

Bank Loans $6

2032 Convert 2038 Convert $253 $407

2016 Senior Notes $1,000

2019 Senior Notes 2022 Senior Notes $500 $1,250

2020 Senior Notes $1,000

The above chart sets forth Omnicom’s debt outstanding at December 31, 2012. The amounts reflected above for the 2016, 2019, 2020 and 2022 Senior Notes represent the principal amount of these notes at maturity on April 15, 2016, July 15, 2019, August 15, 2020 and May 1, 2022, respectively.

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Omnicom Debt Maturity Profile

2022 Senior Notes $1,250

2016 2020 Senior Notes Senior Notes $1,000

$750

2019 Senior Notes $500 2038 Convert 2032 Convert $250

Other Borrowings $0

Our 2038 Convertible Notes are putable in June 2013, 2018, 2023 and annually thereafter until maturity. Our 2032 Convertible Notes are putable on July 31, 2013 and annually in July thereafter until maturity.

Other borrowings at December 31, 2012 include short-term borrowings of $6 million which are due in less than one year. For purposes of this presentation we have included these borrowings as outstanding through October 2016, the date of expiration of our five-year credit facility.

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2012 Acquisition Related Expenditures

Full Year

Acquisitions of Businesses and Affiliates ^(a)$ 101.1 Additional Interest in Controlled Subsidiaries ^(b)32.0 Earn-outs on acquisitions completed prior to January 1, 2009 ^(c)31.7 Earn-outs on acquisitions completed after January 1, 2009 ^(c)32.2

Total Acquisition Expenditures^(d)$ 197.0

(a) Includes acquisitions of a majority interest in agencies resulting in their consolidation, including additional interest in existing affiliate agencies resulting in majority ownership. (b) Includes the acquisition of additional equity interests in already consolidated subsidiary agencies which are recorded to Equity – Noncontrolling Interest.

(c) Includes additional consideration paid for acquisitions completed in prior periods. (d) Total Acquisition Expenditures figure is net of cash acquired.

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Condensed Cash Flow

Full Year 2012 2011 Net Income $ 1,117.5 $ 1,060.4

Share-Based Compensation Expense 80.8 74.5 Depreciation and Amortization 282.7 273.7 Gain on Remeasurement of Equity Interest in Clemenger Group - (123.4) Gain on Remeasurement of Equity Interest in Affiliates (2.1) (15.1) Impairment Charge on Equity Interest in Egyptian Affiliate 29.2 -Other Non-Cash Items to Reconcile to Net Cash Provided by Operating Activities, net (82.0) (22.8) Changes in Operating Capital 25.2 68.0

Net Cash Provided by Operating Activities 1,451.3 1,315.3

Capital Expenditures (226.3) (185.5) Acquisitions, net of Proceeds from Sale of Investments (124.1) (389.1)

Net Cash Used in Investing Activities (350.4) (574.6)

Dividends (397.8) (269.1)

Dividends paid to Noncontrolling Interest Shareholders (98.4) (101.3) Proceeds from/(Repayments of) Short-term & Long-term Debt, net 1,269.9 (43.1) Repayment of Convertible Debt - (0.1) Stock Repurchases, net of Proceeds from Stock Plans and Excess Tax Benefit from Stock Plans (832.0) (701.1) Payments for Additional Interest in Controlled Subsidiaries (32.0) (38.8) Contingent Purchase Price Payments (32.2) (19.7) Other Financing Activities, net (97.6) (32.5)

Net Cash Used in Financing Activities (220.1) (1,205.7) Effect of exchange rate changes on cash and cash equivalents 16.3 (42.5) Net Increase/(Decrease) in Cash and Cash Equivalents $ 897.1 $ (507.5)

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Reconciliation of Non-GAAP Measures

3 Months Ended December 31 Full Year

2012 2011 2012 2011

Revenue $ 3,944.5 $ 3,852.9 $ 14,219.4 $ 13,872.5

Operating Expenses, excluding Depreciation and Amortization 3,324.4 3,295.3 12,132.5 11,927.7

EBITDA 620.1 557.6 2,086.9 1,944.8 Depreciation 46.2 46.5 181.6 182.3 EBITA 573.9 511.1 1,905.3 1,762.5

Amortization of Intangibles 25.9 23.7 101.1 91.4

Operating Income 548.0 487.4 1,804.2 1,671.1

Net Interest Expense 40.3 30.3 144.6 122.1

Income Before Tax 507.7 457.1 1,659.6 1,549.0 Taxes 137.3 156.8 527.1 505.8

Income/(Loss) from Equity Method Investments (26.8) 6.9 (15.0) 17.2

Net Income 343.6 307.2 1,117.5 1,060.4

Less: Net Income Attributed to Noncontrolling Interests 36.5 35.3 119.2 107.8

Net Income - Omnicom Group $ 307.1 $ 271.9 $ 998.3 $ 952.6

The above reconciles EBITDA & EBITA to the GAAP financial measures for the periods presented.

EBITDA and EBITA are non-GAAP financial measures within the meaning of applicable SEC rules and regulations. Our credit facility defines EBITDA as earnings before deducting interest expense, income taxes, depreciation and amortization. Our credit facility uses EBITDA to measure our compliance with covenants, such as interest coverage and leverage ratios, as presented on page 11 of this presentation.

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Reconciliation of Non-GAAP Measures

Full Year 2012 2011 Net Free Cash Flow $ (316.7) $ (457.3) Cash Flow items excluded from Net Free Cash Flow:

Changes in Operating Capital 25.2 68.0 Proceeds from Short-term & Long-term Debt, net 1,269.9 (43.1) Repayment of Convertible Debt - (0.1) Other Financing Activities, net (97.6) (32.5) Effect of exchange rate changes on cash and cash equivalents 16.3 (42.5)

Net Increase/(Decrease) in Cash and Cash Equivalents $ 897.1 $ (507.5)

Full Year 2012 2011 Operating Income $ 1,804.2 $ 1,671.1

Effective Tax Rate for the applicable period 31.8% 32.7% Income Taxes on Operating Income 573.7 546.4

After Tax Operating Income $ 1,230.5 $ 1,124.7

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