SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------ FORM 8-K ------------------ CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): February 28, 2002 The Interpublic Group of Companies, Inc. -------------------------------------------------------------------------------- (Exact Name of Registrant as Specified in Charter) Delaware 1-6686 13-1024020 -------------------------------------------------------------------------------- (State or Other Jurisdiction (Commission File (IRS Employer of Incorporation) Number) Identification No.) 1271 Avenue of the Americas, New York, New York 10020 -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: 212-399-8000 -------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Item 9. Regulation FD Disclosure. On February 28, 2002, The Interpublic Group of Companies, Inc., in connection with a telephone conference with investors, made available via the internet a slide show relating to fourth quarter and full-year 2001 results. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. THE INTERPUBLIC GROUP OF COMPANIES, INC. Date: March 4, 2002 By: /s/ Nicholas J. Camera -------------------------------- Nicholas J. Camera SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY ----------------------------------------------- The Interpublic Group of Companies, Inc Fourth Quarter 2001 Conference Call Notes February 28, 2002 ------------------------------ Summary Fourth Quarter Results ----------------------------------------------------------- (Excludes restructuring charges and other unusual items) $ Millions 2001 2000 Change % -------- -------- ------------ Revenue $1,719.5 $ 2,041.8 (15.8%) EBITDA 331.8 417.0 (20.4) Margin % 19.3% 20.4% Depreciation 50.1 49.2 2.0 Amortization of Intangibles 46.1 42.4 8.7 Income from Operations 235.6 325.4 (27.6) Margin % 13.7% 15.9% Net Income 111.2 190.5 (41.6) EPS .30 .51 (41.2) Summary Full Year Results ----------------------------------------------------------- (Excludes restructuring charges and other unusual items) $ Millions 2001 2000 Change % -------- -------- ------------ Revenue $ 6,726.8 $ 7,182.7 (6.3%) EBITDA 1,148.2 1,363.7 (15.8) Margin % 17.1% 19.0% Depreciation 199.2 192.6 3.4 Amortization of Intangibles 173.0 144.3 20.0 Income from Operations 776.0 1,026.8 (24.4) Margin % 11.5% 14.3% Net Income 359.2 570.3 (37.0) EPS .96 1.53 (37.3) Fourth Quarter 2001: Components of Revenue Change ----------------------------------------------------------- $ Millions 2000 Revenue $2,041.8 Effects of: Variance % Organic (205.8) (10.1)% Loss of Chrysler (35.9) (1.8) Currency Translation (52.2) (2.6) Acquisitions (net of dispositions) (28.4) (1.3) -------- ----- 2001 Revenue $1,719.5 (15.8)% ======== ==== Year 2001: Components of Revenue Change ----------------------------------------------------------- $ Millions 2000 Revenue $7,182.7 Effects of: Variance % Organic (207.4) (2.9)% Loss of Chrysler (116.3) (1.6) Currency Translation (159.4) (2.2) Acquisitions (net of dispositions) 62.2 0.9 September 11 (35.0) (0.5) -------- ---- 2001 Revenue $6,726.8 (6.3)% ======== ==== 4Q01 Components of Net Income Change ----------------------------------------------------------- (Excludes restructuring charges and other unusual items) $ Millions 4Q 2000 Net Income $190.5 Decrease in Revenue (322.3) Decrease in Operating Expenses 237.1 Increase in Depreciation and Amortization (4.6) Decrease in Non-Operating Items 8.6 Increase in Equity Earnings and Minority Interests 1.9 ------ 4Q 2001 Net Income $111.2 ====== 2001 Components of Net Income Change ----------------------------------------------------------- (Excludes restructuring charges and other unusual items) $ Millions 2000 Net Income $570.3 Decrease in Revenue (455.9) Decrease in Operating Expenses 240.4 Increase in Depreciation and Amortization (35.3) Decrease in Non-Operating Items 32.9 Increase in Equity Earnings and Minority Interests 6.8 ------ 2001 Net Income $359.2 ====== Pro Forma EBITDA Margin Trend ----------------------------------------------------------- * Estimated impact of September 11: $35 million or 210 basis points. '00 '01 First Quarter 13.4% 14.8% Second Quarter 23.3% 19.5% Third Quarter 17.8% 14.4%* Fourth Quarter 20.4% 19.3% * Estimated impact of September 11 is $35 million or 210 basis points, which would have resulted in an EBITDA margin trend of 16.5%. Selected Cash Flow Items ----------------------------------------------------------- $ Millions 2001 2000 ------ ------ Depreciation and Amortization of Fixed Assets $ 199.2 $ 192.6 Amortization of Intangible Assets 173.0 144.3 Acquisitions 314.1 653.2 Capital Expenditures 268.0 259.5 Dividends -- IPG only 136.6 109.1 Purchase of Treasury Stock 115.7 253.9 Selected Balance Sheet Items ----------------------------------------------------------- $ Millions December 31, September 30, December 31, 2001 2001 2000 ------------ ------------- ------------ Cash & Cash Equivalents $ 935.2 $ 685.6 $ 844.6 Total Debt 2,933.7 3,125.9 2,081.1 Debt as % of Capital 60% 63% 46% Stockholders' Equity 1,979.3 1,863.5 2,482.4 2001 Net New Business ----------------------------------------------------------- Key Wins Key Losses ------------- --------------- Verizon Gateway L'Oreal Dell United Parcel Service Fidelity Sepracor Gillette Oral Care Microsoft Sirius Satellite Radio Pfizer/Pharmacia AT&T Wireless Coca-Cola Reckitt & Benkiser H.J. Heinz PepsiCo Best Foods (Unilever) Total Wins $5,548.5 Total Losses $2,762.9 Net New Business $2,785.6 2002 New Business Wins ----------------------------------------------------------- Sony American Airlines Starwood Hotels HSBC Zenith Electronics Tricon Global Restaurants Electrolux Nextel Revlon Deutsche Telekom MCI Worldcom Outlook and Guidance -- 2002 ----------------------------------------------------------- o First and second quarter revenue comparisons remain difficult o In a flat full-year revenue scenario, EPS grows 15% - If full year revenue increases, each 1% of revenue growth generates an incremental 2% EPS growth - If full year revenue declines, margins will equal or exceed 2000 level Appendix I: Revenue by Discipline ----------------------------------------------------------- ($Millions) Fourth Quarter Full Year Revenue Revenue -------------------------------------------- -------------------------------------------- % of % of % % of % of % 2001 Rev 2000 Rev Change 2001 Rev 2000 Rev Change -------------------------------------------- -------------------------------------------- Promotion Event And Direct Marketing (Incl. Healthcare Marketing) 371.5 21.6% 415.5 20.3% (11%) 1,429.1 21.2% 1,366.6 19.0% 5% Public Relations 124.8 7.3% 165.7 8.1% (25%) 578.1 8.6% 611.3 8.5% (5%) Marketing Intelligence 146.8 8.5% 158.5 9.7% (7%) 551.5 8.2% 555.6 7.7% (1%) Interactive 23.9 1.4% 39.1 2.0% (39%) 106.7 1.6% 164.9 2.3% (35%) ------- ------- ------- ------- Total Specialized Marketing Services 667.0 38.8% 778.8 38.1% (14%) 2,665.4 39.6% 2,698.3 37.6% (1%) Total Media Buying & Advertising 1,052.5 61.2% 1,263.0 61.9% (17%) 4,061.4 60.4% 4,484.4 62.4% (9%) ------- ------- ------- ------- Total 1,719.5 100% 2,041.8 100% (16%) 6,726.8 100% 7,182.7 100% (6%) ======= ======= ======= ======= Appendix II: Revenue by Region Fourth Quarter 2001 ----------------------------------------------------------- ($Millions) % % Change % Change Revenue % Total Change Constant $ Organic --------------------------------------------------- Europe $ 496.6 29% (10%) (6%) (7%) Latin America 96.4 6% (14%) (6%) (7%) Asia/Other 158.5 9% (18%) (12%) (11%) Canada 49.5 3% (5%) (1%) 3% -------- -------- -------- -------- -------- Total International 801.0 47% (12%) (7%) (6%) Total Domestic 918.5 53% (19%) (19%) (15%) -------- -------- -------- -------- -------- Total $1,719.5 100% (16%) (14%) (10.1%) ======== ======== ======== ======== ======== Appendix II: Revenue by Region Year 2001 ----------------------------------------------------------- ($Millions) % % Change % Change Revenue % Total Change Constant $ Organic --------------------------------------------------- Europe $1,840.7 27% 0% 4% 0% Latin America 327.1 5% (2%) 9% 4% Asia/Other 583.6 9% (3%) 4% 0% Canada 169.6 2% 4% 8% 3% -------- -------- -------- -------- -------- Total International 2,921.0 43% (1%) 5% 3% Total Domestic 3,805.8 57% (10%) (10%) (7%) -------- -------- -------- -------- -------- Total $6,726.8 100% (6%) (4%) (2.9%) ======== ======== ======== ======== ======== Appendix III: 2001 Quarterly Results Restated for FAS 142 ----------------------------------------------------------- (Excludes one time charges and restructuring items) 1Q 2Q 3Q 4Q Year ---------------------------------------------------- Revenue $1,658.3 $1,743.4 $1,605.6 $1,719.5 $6,726.8 EBITDA 246.1 339.1 231.2 331.8 1,148.2 Margin % 14.8% 19.5% 14.4% 19.3% 17.1% Depreciation 49.6 50.4 49.1 50.1 199.2 Amortization of Intangibles 0.9 1.0 1.0 1.0 3.9 Income from Operations 195.6 287.8 181.1 280.7 945.2 Margin % 11.8% 16.5% 11.3% 16.3% 14.1% Net Income 111.8 152.1 89.8 150.3 504.0 EPS .30 .40 .24 .40 1.34 Appendix IV: Summary of Restructuring Charges and One Time Items ----------------------------------------------------------- Full Year 2001 ($ Millions) Annualized Total Cash Non-cash Savings --------------------------------------------- Severance $297.5 $297.5 $ - $250.0 Facilities costs 257.6 180.1 77.5 50.0 Other Restructuring Costs 53.3 32.2 21.1 Transaction costs 37.2 31.5 5.7 ------ ------ ------ ------ $645.6 $541.3 $104.3 $300.0 ====== ====== ====== ====== Goodwill and other charges $303.1 - $303.1 - Investment write-offs 208.3 - 208.3 - Other Non Recurring (Net) 35.4 35.4 ------ ------ $546.8 $546.8 ====== ====== Appendix V: Summary of Reported Fourth Quarter Results ----------------------------------------------------------- $ Millions 2001 2000 Change % ------ ------ ---------- Revenue $ 1,719.5 $ 2,041.8 (15.8%) EBITDA 331.8 354.8 (6.5) Margin % 19.3% 17.4% Depreciation 50.1 49.1 2.0 Amortization of Intangibles 46.1 42.5 8.5 Income from Operations 235.6 263.2 (10.5) Margin % 13.7% 12.9% Net Income 111.2 113.0 (1.6) EPS .30 .30 - Appendix VI: Summary of Reported Full Year Results ----------------------------------------------------------- $ Millions 2001 2000 Change % ------ ------ ---------- Revenue $ 6,726.8 $ 7,182.7 (6.3%) EBITDA 164.0 1,186.0 (86.2) Margin % 2.4% 16.5% Depreciation 199.2 192.6 3.4 Amortization of Intangibles 173.0 144.3 19.9 Income (Loss) from Operations (208.1) 849.1 (124.5) Margin % (3.1%) 11.8% Net Income (Loss) (505.3) 420.3 (220.2) EPS (1.37) 1.14 (220.2) Cautionary Statement ----------------------------------------------------------- This document contains forward-looking statements. Statements that are not historical fact, including statements about Interpublic's beliefsand expectations constitute forward-looking statements. These statements are based on current plans, estimates and projections, and therefore undue reliance should not be placed on them. Forward-looking statements speak only as of the date they are made, and Interpublic undertakes no obligation to update publicly any of them in light of new information or future events. Forward-looking statements involve inherent risks and uncertainties. Interpublic cautions that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Such factors include, but are not limited to, those associated with the effect of national and regional economic conditions, the ability of Interpublic to attract new clients and retain existing clients, the financial success of the clients of Interpublic, and developments from changes in the regulatory and legal environment for advertising companies around the world, and the successful completion and integration of acquisitions which complement and expand Interpublic's business capabilities. Another important factor is Interpublic's acquisition strategy. One of Interpublic's business strategies is to acquire businesses that complement and expand its current business capabilities. Accordingly, Interpublic is usually engaged in evaluating potential acquisition candidates. Interpublic is currently engaged in a number of preliminary discussions that may result in one or more substantial acquisitions. These acquisition opportunities require confidentiality and from time to time give rise to bidding scenarios that require quick responses by Interpublic. Although there is uncertainty that any of these discussions will result in definitive agreements or the completion of any transactions, the announcement of any such transaction may lead to increased volatility in the trading price of the shares of Interpublic. Moreover, the success of recent or contemplated future acquisitions will depend on the effective integration of newly-acquired businesses into Interpublic's current activities. Important factors for integration include realization of anticipated synergies and the ability to retain new personnel and clients. This document includes financial information calculated on a "pro forma" basis. This "pro forma" financial information, by its very nature, departs from traditional accounting conventions. Accordingly, "pro forma" financial information should be read in conjunction with, and should not be viewed as a substitute for, the information prepared in accordance with Generally Accepted Accounting Principles (GAAP) contained in this document, including the GAAP numbers under the "actual reported" columns in the unaudited "consolidated summaries of earnings" contained in this document. Investors should evaluate any statements in light of these important factors.