Eye-catching creative work for brands such as Vodafone, Cadbury and Fevicol has not only got Ogilvy & Mather (O&M) the reputation of being the most creative, it has brought in profits as well.
O&M closed FY07 with revenue of Rs 228 crore, a 25 per cent jump from Rs 183 crore reported in FY06. The company reported a net profit of Rs 63 crore in FY07 — an increase of over 14 per cent from Rs 55 crore in the previous financial year. This translates to an earnings per share of over Rs 650.
While profits were from existing clients such as Asian Paints, Castrol/BP, Vodafone, Fevicol and Cadbury, O&M also added an impressive list of new clients in 2007. Some big-ticket account wins include Birla Sun Life Insurance, Canara Bank, Dabur, HDFC Bank, Unitech and Videocon Industries.
Attracting talent and retaining good people is a huge cost in a service industry like advertising, and it’s no different for O&M. Staff cost increased nearly 20 per cent to Rs 71 crore in FY07.
With these results, O&M India has managed to be the number three agency in the worldwide WPP rankings. While it is a known fact that 74 per cent of O&M India is held by parent WPP and the rest by the Indian employees, what is not known is the fact that Piyush Pandey, executive chairman and chief creative officer, holds more than any other individual in the agency.
Pandey with his 18,500 shares owns 2 per cent in the agency. Chief financial officer S N Rane owns close to 16,000 shares.
In 2007, the agency declared a dividend of Rs 505 per share, which means Piyush Pandey took home nearly Rs 1 crore just as dividend! O&M closed FY07 with reserves and surplus of nearly Rs 75 crore and a cash balance of over Rs 70 crore.