Global agency Dentsu has said that it expects to see organic growth of 1% across 2024, after a turbulent 2023.
In its fourth quarter results, Dentsu revealed that it registered a small, 0.7% increase, in year-on-year net revenues and a 1.6% overall net revenue growth for the 2023 financial year.
However, the agency saw its organic revenue fall by a significant 6.6% in the fourth quarter and by 4.9% year-on-year.
Dentsu attributed the bulk of this fall in revenue to setbacks to large projects within its Customer Transformation & Technology (CT&T) operations due to rising global prices.
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More positively, its CT&T revenues did however generate 32% of group revenues in 2023, illustrating strong progress towards the agency’s goal of having 50% of its revenue indexed to the division.
Dentsu said that in 2024 it will be focused on returning to more consistent growth, with its guidance forecasting 1% organic growth and an operating margin of around 15%.
“2023 was a challenging year for the group, with internal and external headwinds impacting our organic revenues and profitability. The leadership team and I remain focused on returning the group to growth this year,” Dentsu president and global CEO, Hiroshi Igarashi said.
“As we look forward to 2024, we see some headwinds dissipating. We expect to see a return to spending from technology clients – particularly in the US market.”
