Publicis Groupe S.A. (PUB) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Third Quarter 2022 Revenue Presentation of Publicis. For your information, this conference is being recorded. At this time, I would like to turn the conference over to Mr. Arthur Sadoun, Chairman and CEO of Publicis Groupe.

Thank you, Elise. [Foreign Language], and welcome to Publicis Groupe 2022 Third Quarter Revenue Call. I am Arthur Sadoun, and I'm here in Paris with our CFO, Michel-Alain Proch. Alessandra Girolami is also here and will be available to take all of your questions off-line after this session. I will start this call by sharing the main highlights of Q3. Then Michel-Alain will talk us through the detail of our numbers. After that, I will conclude with our outlook. Finally, we will take all of your questions. But before we start, please take the time to read the disclaimer, which is an important legal matter. Let's dive into our presentation. In the context of rising tensions in the global economy, Q3 was another strong quarter this year. We posted plus 10.3% organic growth, ahead of expectations. Q3 marks the third consecutive quarter of double-digit growth this year after plus 10.3% in Q2 and plus 10.5% in Q1. But as you know, what matters the most to us is our performance compared to 2019 before the pandemic. This is the one that truly assesses our underlying growth above and beyond the ups and downs of the global economies. Actually, we continue to see real momentum on this basis as we are accelerating in Q3 with plus 16% organic growth, following plus 12% in Q2 and plus 10% in Q1 compared to '19. Our Q3 performance leads us to plus 10.3% organic growth for the first 9 months of the year. On a reported basis, including ForEx and acquisitions, our first 9 months net revenue actually exceeded EUR 9 billion, which is 21% higher than the same period last year and 31% higher than in 2019 before the pandemic. Looking at our Q3 numbers in detail. we continue to outperform this quarter, thanks to our unique model, which is fully integrated between data, tech at scale at the heart of our creative and media activities. This was visible in the performance of our activity mix across our regions and in our new business momentum. Let me break that down. First, our strong activity mix. In Q3, we demonstrated again our ability to capture the evolution in client spend towards first-party data, digital media and business transformation. Publicis Sapient and Epsilon, which together represent 1/3 of our net revenue, were again significantly accretive to the group performance in Q3. With Q3 organic growth at plus 18.1%, Publicis Sapient continued to perform strongly in an environment where the demand for digital business transformation, direct-to-consumer capabilities and commerce solutions remained high. Epsilon saw its performance accelerate to plus 13.9% organic growth in Q3 with very strong digital media this quarter, capturing the rise in demand for targeted ID-based media. In addition to the fast-growing activities of DBT and data, media achieved double-digit organic growth this quarter, mostly fueled by digital. Creative was up mid-single digits, including a very solid performance from production. Second, the strength of our model was visible in the performance of all of our regions. The U.S., which represents 60% of our business, continued to show a very strong dynamic at plus 11.1% organic growth in Q3. This represents plus 20% organic growth versus '19, an acceleration compared to the first half of the year. As in Q2, media, Epsilon and Publicis Sapient were accretive to organic growth, while creative, driven by production, grew high single digits. Europe saw its organic growth accelerating to plus 11.1%, both on a 1-year basis and on a 3-year basis. This was driven by a very strong performance in the U.K., which reported organic growth at plus 22.6%, almost doubling the rate of H1, thanks to the outstanding activity at Publicis Sapient, combined with double-digit growth in both creative and media. France grew plus 7.8% organically in the quarter, with broadly stable creative and double-digit growth in media. Central and Eastern Europe accelerated to double-digit growth despite the lack of activity in Ukraine. Asia was a plus 4.1% organic growth in Q3. While Southeast Asia was broadly stable, China accelerated to plus 5.9% this quarter despite ongoing lockdowns as it benefited from new business ramp-up. Third, the strength of our model is also visible as we continue to top new business leads. After a strong first half, we won the largest budget in review this summer. Of note, we won the biggest pitch after [ IBI ] this year by consolidating 80% of Mondelez business and adding Europe to our scope. After winning Pepsi media in China this April, we won their creative and media in India and [ audit ] Southeast Asia this summer. Our momentum also continued when it comes to creative, with the win of Standard Chartered bank globally. This means that over the last 12 months, we continued to rank first in new business broker reports, again, well ahead of the rest of the industries. I will now leave the floor to Michel-Alain before updating you on our outlook.

Thank you, Arthur. Good morning to all of you, and glad to be with you today. I will begin with Slide 10 (sic) [ Slide 9 ], which shows the evolution of the net revenue for the third quarter and first 9 months of 2022. In Q3, the group posted net revenue of EUR 3.237 billion, representing an organic growth of 10.3%. With this strong performance, we have posted double-digit growth again this quarter at the same level as Q1 and Q2. Reported net revenue growth was 23.5% in the quarter. Reported growth was 20.6% on 9 months, which is an increase of EUR 1.558 billion, comprising the following elements: first, the 10.3% organic growth representing EUR 847 million. Second, ForEx was a positive impact of EUR 649 million, out of which EUR 544 million linked to the USD to euro rate. Assuming the USD to euro exchange rate remains at Q3 average level, it would mean a circa EUR 200 million on Q4, leading to a circa EUR 765 million positive impact on the group reported top line for the full year. And finally, acquisition, net of disposal, contributed EUR 62 million to the group revenue. On one hand, this includes net revenue from acquisition for EUR 92 million, the most important contribution being CitrusAd, Boomerang and BBK acquired in 2021 and Tremend and Profitero acquired this year. On the other hand, disposal impacted net revenue for circa EUR 30 million, the most important one being obviously the exit of our operation in Russia from April 1. Let's move on to Slide 11 (sic) [ Slide 10 ], which is giving you the dynamics of our Q3 organic and reported growth by region. North America posted another quarter of double-digit expansion with 11% organic growth. Additionally, the impact of ForEx was obviously significant, thanks to the USD to euro rate, bringing the region reported growth to circa 30%. Europe also recorded double-digit growth this quarter at 11.1% organically. This was an acceleration compared to Q2, thanks to a very strong performance in the U.K. Asia Pac posted 4.1% organic growth, with China accelerating at 5.9% despite ongoing lockdowns and Southeast Asia broadly stable. While Middle East and Africa posted low single-digit organic growth in Q3, Latin America continued to perform very well this quarter with 19.4% organic growth. So let's dive in more detail on North America on Slide 12 (sic) [ Slide 11 ]. As I've just said, our operation in the region saw their performance reach 11% organic growth this quarter. In the U.S., the group's largest country, all activities continue to perform very well. Media posted double-digit growth, fueled by strong underlying trends and new business won in the last 18 months, notably in the TMT and food and beverage sectors. Creative activities posted a high single-digit growth, fueled by production, which materialized mostly in automotive, financial services and retail sector. Publicis Sapient accelerated to 20.9% organically as we were able to capture the very dynamic demand in digital business transformation, particularly in the financial services, health care and retail sector. Epsilon grew 13.9% organically, with a particularly strong performance in digital media driven by strong demand for data-driven marketing and advertising solution. The automotive division confirmed its recovery in Q3 while data grew double digit again and tech posted a very solid high single-digit growth. It is worth noting that both Publicis Sapient and Epsilon grew strongly compared to pre-COVID level at circa 40% for Sapient and circa 30% for Epsilon compared to 2019, highlighting the structural demand for those capabilities. Let's turn to the performance in Europe on Slide 13 (sic) [ Slide 12 ]. As I mentioned earlier, Europe recorded double-digit growth this quarter after 10% in Q3 last year. Excluding outdoor media activities and the Drugstore, our activities in the region grew by 12.8%. The U.K., which represents 9% of our net revenue, significantly contributed to the growth in the region with an acceleration to 22.6% organic. This performance included a particularly strong quarter for Publicis Sapient, thanks to the ramp-up of large contracts in financial services and, to a lesser extent, in retail. Also notable was a double-digit growth, both in creative with existing clients and in media, supported by global new business wins. France, which represents 5% of our net revenue, posted a 7.8% growth, excluding outdoor media activities and the Drugstore, thanks to a strong performance in media, notably in the automotive sector and at Publicis Sapient. Germany, which represents 3% of our net revenue posted 2.5% organic growth, with a solid media that more than offset softer creative. Publicis Sapient in Germany posted a high single-digit growth in the quarter. Lastly, our operation in Central/Eastern Europe accelerated to 13.4% on an organic basis. Poland, Romania, Hungary and Turkey all posted double-digit growth. This performance was achieved despite no activity in Ukraine. On Slide 14 (sic) [ Slide 13 ], I will detail our performance in the rest of the world. Asia Pac, which represents 9% of group net revenue in Q3, posted a 4.1% organic growth. China improved sequentially, with 5.9% in the quarter compared to 2.7% in Q2, supported by new business ramp-up and despite the strict lockdowns that continue to impact many cities in the country. Southeast Asia was broadly flat with diverse situation. While Philippines and Malaysia posted double-digit growth, India was stable, and Thailand decreased in the quarter due to tough comparables, particularly at Publicis Sapient in the financial sector. Australia and New Zealand, both posted very solid growth. In Middle East and Africa, we posted 1.9% organic growth driven by media and creative activities that offset a decline in Publicis Sapient on a particularly high comparable base the previous year. Latin America grew 19.4% organically as Brazil posted positive growth fueled by creative. And a majority of countries recorded double-digit organic growth, largely driven by media. On Slide 15 (sic) [ Slide 14 ], you will find the group performance by client industry for the first 9 months. This is based on an analysis of our main clients representing 92% of our net revenue, and it excludes outdoor media activities and the Drugstore. On the first 9 months of the year, all of our client industry continued to post very solid trends, with the exception of nonfood consumer products that decelerated while remaining positive in Q3. Three main sectors accelerated the growth in Q3. First, the retail sector with over 20% growth in 9 months, thanks to new business across different activities. Second, automotive, which grew 9% in Q3 and posted 7% growth on 9 months. And third, food and beverage showed a strong growth at 12% in the first 9 months, particularly thanks to media and data. Two sectors confirmed the H1 trajectory in Q3. Financial services grew 13% in the first 9 months, notably thanks to Publicis Sapient, and TMT grew 10% in the first 9 months on a mix of new business and organic growth at existing clients. I move on to Slide 16 (sic) [ Slide 15 ], net financial debt. The group closing net debt reached EUR 919 million at the end of September 2022. It's an increase of about EUR 843 million compared to the end of December, mainly due to dividend paid in July for EUR 608 million, combined with the cyclical nature of working capital. The average net debt on the last 12 months is EUR 870 million, decreasing by circa EUR 150 million compared to the end of June 2022. When we include the average lease, this represents a leverage of 1.3x EBITDA in line with H1 and improving versus 1.7x a year ago. Should the USD to euro remain at the current level, we now expect average net debt for the year to be between EUR 800 million and EUR 900 million. This concludes my financial presentation, and I now give back to you, Arthur.

Thank you, Michel-Alain. As you have seen, Q3 was another strong quarter this year. Taking into account our 9 months performance at plus 10.3% organic and a better visibility on Q4, we are in position to upgrade our full year organic growth guidance for the second time this year to circa plus 8.5% compared to the 6% to 7% brackets previously given. More specifically, for Q4, we are obviously adopting a cautious stance as micro conditions like inflation, supply shortages and the conflict in Ukraine may increasingly affect our clients, particularly in a quarter of adjustments. But we also anticipate the robust trends we are experiencing at the moment to continue, thanks to our unique revenue mix. This is why we are now anticipating Q4 organic growth in the range of 3% to 5% and upgrade from the 0% to 4% that we anticipated previously. Given our organic growth performance in 2022, we will deliver a record operating margin coming close to 18% compared to our previous 17.5% to 18% guidance. We will also deliver a higher free cash flow at close to EUR 1.6 billion versus at least EUR 1.5 billion previously. The year ahead is full of uncertainties that we do not underestimate, but thanks to our model, we are ready to face them. Over the last years, thanks to the acquisition of Epsilon and Publicis Sapient and their integration with our creative and media operation through our country model, we have radically changed our go-to-market, consequently, our growth path and, ultimately, our revenue mix. This enables us today to help our clients weather the macroeconomic challenges in the context of inflation where they need to drive growth while generating efficiencies. We are partnering with them to face the fundamental changes reshaping the marketing land place: privacy-led identity, new digital media channels and the shift from paid to owned media as well as a tougher competitive market. The superiority of our offer has been recognized in Forrester latest reports, where we lead the industry in the most relevant categories, from global marketing services, digital experience, media management to consumer data strategy and activation. But we won't stop there. As we continue to help our clients transform through digitalization and personalization, in the next years, we will accelerate on what will shape the future of our business, the new age of commerce. Thanks to data and technology, we know that today, every brand experience, from a text to a tweet, through a TikTok video to a television spot, a store visit to a transaction in the metaverse, everything has the potential to become a commerce experience. At Publicis, our ability to seamlessly combine data, creative, media and technology makes us uniquely positioned to deliver on those commerce experiences and put them at the core of our client transformation journey. This means helping them navigate, develop and activate commerce in a way that is effective for their business but also responsible to our society and our planet. To achieve this strategic ambition, with the Board, we have decided to put in place a new generation of leaders. This new management team called the Directoire+ is composed of Carla Serrano, Dave Penski, Nigel Vaz and Agathe Bousquet. Together, they bring the right alchemy of modern creativity, media and technology to the Power of One and have the responsibility with our wider management team of projecting us into the new era of commerce. Voilà, after a third quarter of double-digit growth, we are again upgrading our full year 2022 guidance and will deliver circa plus 8.5% organic growth, with an operating margin at close to 18% and close to EUR 1.6 billion in free cash flow. So as you can see, despite the current economic environment, we are demonstrating a strong dynamic based on the unique set of capabilities, our platform organization and the outstanding dedication of our teams. I would like to finish this presentation by thanking our clients for their trust. I would also like to take a moment to sincerely thank our talent for their incredible efforts. In the context where inflation affects their daily lives, we have decided to grant an additional 1 week salary to employees who do not have any variable remuneration and who have been with us throughout this past year. This represents 50% of our people. This bonus will be paid in November to support them as we are entering the holiday season. Thank you for listening. And now with Michel-Alain, we will take all of your questions.

[Operator Instructions] We will take our first question from Lina.

[Foreign Language] Congratulations on the results. Took my breath away this morning. So I have 3 questions, please. Firstly, and apologies in advance for asking, but could we just get a sense of the monthly trajectory or as July, August, September? And secondly on Sapient, I think you previously guided for 15% organic growth for the year. Do you expect more now? And also what is the visibility that you have on the upcoming contract? And lastly, a very predictable question, but 2023, I know it is very early, but perhaps you could comment on how the budgeting is going with your clients, what are you saying around the marketing investment for next year? And basically, what is your interpretation of their appetite?

I'm sorry, we hear you very badly. So we couldn't take all the questions. I -- we couldn't -- I've got this question about July, August and so the first -- could you repeat the question because it was very difficult to hear you?

Okay. So the first one is just on the monthly trajectory. The second one is on Sapient. I believe you previously guided for 15% organic growth for this year. Do you expect more now? And what is the visibility you have on the upcoming contracts? And the third one was on 2023. I know it's very early, but perhaps you could comment on how the budgeting is going with your key clients, what they're saying around the marketing investment for next year? That was the third question.

Thank you very much, Lina. I'm going to take the 2 second one, and I will leave you the first, Michel-Alain, if it's fine for you, okay? Yes? Yes. So I'll start with Publicis Sapient because, as you have seen, it's an important driver for growth and also a big point for transformation. As you have seen, we have grown by 18.1% organically in Q3, which means that on a 9-month basis, we are already at 19%, again. It's coming ahead of our expectation because there have been a ramp-up in new contracts that has been higher than expecting, the demand being very, very strong. What is very interesting is when you look at the 3-year basis for Sapient. In Q3, on a 3-year basis, we are roughly at 30%, okay? When we were in the first half at 18%, which shows again the acceleration, and you know how important it is for us to have a visibility on the 3-year stack. And to answer directly your question, we are planning for the moment to see a growth over the year that is at 15%. When it comes to 2023, look, it's, of course, like every year, way too early in Q3 to give you a guidance for next year. And to be honest, it's even more true today when you look at the macroeconomic tension. But there is some point I can tell you, which is we feel that we are very well armed to face the macro uncertainties that are coming. First, when you look at the revenue front, we have a balanced mix of activity that is representing 1/3 of our activity in data and tech, and we know that there will be an increased demand on that. So again, when you talk about Publicis Sapient, when you talk about Epsilon, we have 1/3 of our revenue that is growing fast and, by the way, nourishing our media and creative operation. And when you look at the cost side, okay, our platform organization that is supported by our global delivery center and our shared services have definitely demonstrated their agility. And we feel that here again, we are very well prepared to face any kind of uncertainties. Again, we can't tell you more today. We will definitely in Q4. So again, more color on Q4. I can take the point on the client, but maybe I'm going to give it to you and then come back on the client and explain more about the clients.

Yes, sure. Maybe to answer your question, Lina, about Q3. Coming back on Q3, there are 2 main points that I would like to underline to explain our overperformance. The first one is that the macroeconomic concern that you all anticipated did not impact our clients significantly so far. And this materialized in media and creative, both performing above our expectation. That's the first point. And the second, as Arthur was saying, while we knew that Publicis Sapient and Epsilon would perform well, they performed even better, notably with Epsilon capturing an even larger share of digital media. So in a certain way, in Q3, we had a great alignment of planets, with all of our activities coming ahead of our expectation. Now in the detail of -- and I think it was your precise question, the detail of the trajectory in the quarter. It was actually very solid throughout the quarter, with all months growing double digit on a 3-year basis.

Again, as we did not understand very well the question, we are going very broad. And hopefully, we are touching a lot of points that will come in later. But when you look at the overall client behavior, which was also one of your points, honestly, it is pretty well reflected in Q3, although Q3 was already a strong quarter for the reason Michel-Alain just highlight. But first of all, so far, we haven't seen any material impact on spend reduction coming from our clients. We are saying so far, of course, we have to be cautious, but this is the case. It's clear that all of our clients today already are dealing with many challenge, and they will continue to deal with those challenges in the future. Will it be inflation, supply shortages or the war in Ukraine? And it could definitely lead to some cuts in traditional marketing spend. This is not what we have experienced again in Q3, and this is why the region are performing well, particularly with media and creative, but it could come. What we think and what we are experiencing, by the way, is that our clients, despite the challenges they are facing and maybe because of the challenges they are facing, won't stop from investing in their marketing and business transformation. And so we feel confident that the strength of our model will help them face those challenges and so represent demand for us. Lina? Yes? Okay. We're going to assume we were good. Hopefully, we have the question -- the second question better. And the sound is working. If not, I'm moving to the other room.

We will take our next question from Lisa Yang from Goldman Sachs.

Congratulations again. A few questions. I mean, firstly, on the margin, which you raised slightly to 18%, could you just clarify what's the headwind from the additional bonus you're now giving? And what's driving, I guess, the payment of that initial bonus? And also how much impact from FX you're baking into this guidance because, obviously, there was a 40 bps benefit in H1. So what are you expecting for the full year now? And is that in that 18% guidance? That's the first question. The second one is, obviously, on Q4, your guidance is 3% to 5%, which obviously implies on the 3-year stack the sharp deterioration from 8% to 10% on the 3-year stack versus 16% in Q3. I understand it brings it more in line with maybe Q1. But then the question is, was there any one-off in Q3, which explained obviously the big acceleration to 16% and then you expect basically a normalization back to normalized trends of 10% in Q4? Or anything else that you can tell us on that slowdown in Q4? Are you seeing that already? And the third question is actually 2 small questions on just U.K. Why was it so strong at 23%? Was there any one-off in there? And if it's mainly driven by Sapient, is that stable in Q4 as well? And similarly on China, that was also very strong despite the lockdown. So should we also expect Q4 to be positive? And what's driving that?

Thank you very much. I propose we start with the margin, and then I will take the Q3, Q4 question in U.K. and China.

Yes. Sure, Lisa. So in terms of margin, the exceptional bonus we are granting is representing about EUR 50 million, 5-0, which represents 40 bps in that we are investing in our talent. So maybe let me give you a bit the overall bridge of margin, if you wish. So we've got this minus EUR 40 million, okay, which is financed by the operating leverage of the group. We are upgrading our guidance in terms of revenue, moving to -- from 6% to 7% to 8.5%. So if you take the mid part of the bracket, it's about EUR 225 million additional revenue. While calculating the operating leverage of the group, this materialized in about 45 bps of additional margin. And it is this 45 bps that we are investing into this 1-week exceptional bonus that Arthur just talked about. And just to be complete, the USD to euro staying at parity for the rest of the year will derive another 10 bps -- positive 10 bps into the margin. So plus 45, plus 10, minus 40, so it's a circa plus 15 net-net that is flowing down to our bottom line, and which account for our margin upgrade at close to 18%. Back to you, Arthur.

Thank you, Michel-Alain. So the Q3, Q4 question, let me just come back on what Michel-Alain said about Q3 first. It was Q3 a particularly strong quarter, where all the planets were aligned. If I want, again, to cut this long story short, on one side, all the macroeconomic difficulties that were anticipated by the market has not been reflected in our number. And this has a massive impact on our media and creative business that stand -- that stood very strong. And second, we were anticipating good growth at Epsilon and Sapient, but we have seen a level of growth that was superior. So again, we went through a quarter where all the planets were aligned. And this is why it was so strong. And this is why, by the way, we don't consider that there is a slowdown in Q4. Now to give you more color on Q4 because this is a very important question and to tell you how we are anticipating and guiding for Q4. First of all -- and this is very reassuring -- is that we believe that the robust trends of our underlying business will continue this quarter. From what we see at the moment, the model we have in place do answer exactly what our clients need, and we will see and continue to see those robust strengths. Now we have definitely factored in some cautiousness because we all know that the last quarter of the year is a quarter of adjustments. And by definition, when you look at all the macroeconomic uncertainties that our clients are facing, they might have to adapt their budget in the last months of the year. So we feel that the dynamic is still very strong, but we have to be cautious in the context of macroeconomic uncertainty and, more importantly, in a quarter of adjustments. But to be clear, with what we have enhanced today, we believe that we should be very close from 5%, which means coming back to your question, that we will deliver, on a 3-year basis, still double-digit organic growth, which is what you have seen in the first semester. So again, a particularly strong Q3 [ a year ] on a 3-year stack that should be double digit. And again, you can see quarter-by-quarter how this is being effective with, again, good news that we are sharing with you and with our people, by the way, in Q3. When it comes to U.K., first of all, it's important to note that there is no one-off in the U.K. results. It grew by 22.6% organically in Q3, and it has actually almost doubling the rate compared to Q2. This is mainly driven by the performance of Publicis Sapient that has been extremely strong. And that, by the way, represent in the U.K. 1/3 of our revenue, which again makes us also confident for Q4. I don't know if you remember because we had this discussion already in the last year and even the year before, where there have been a slowdown with Publicis Sapient in the U.K. We always told you not to worry because it was clients actually reducing their spend, not client going somewhere else. It was a question of CapEx at a time where cash was difficult for them. And the truth is now that things are back on track for them, first, we are seeing an expansion in the financial services. And second, we are seeing a significant ramp-up when it comes to new business wins, notably in retail. So again, we feel very good about the U.K. It's important to note at this stage that creative and media are also posted solid results. And we believe that the dynamic we are seeing through Sapient in the U.K. will definitely continue to be accretive in Q4. It's -- funny is maybe not word, but it's interesting that you touch on U.K. and China because if you remember, we said the same for China in a way, which is, at one point, our growth was a bit slow in China. It was very strong in the region but a bit slower. And we told you not to worry because the new business pipeline was very strong. We are very confident with the time -- with the team we have, and we knew they will very well perform and, I think, outperform the market. When you take into consideration the lockdown that is happening there, this is plus 5.9%, a very good performance. It is a tailwind coming from new business, our ability to help our clients transform. And again, we feel confident about what is being done in China and, overall, in Asia. As I commented earlier, the new business momentum we are having in the region, particularly starting from Singapore with some global accounts, one in the region, is making a huge difference.

We will take our next question from Omar Sheikh from Morgan Stanley.

So I've got 3 questions as well. Maybe to start with creative and media, you've given a few basis points during the call about how your creative and media business has been doing. But maybe if you could just wrap up how across the group the performance was in Q3. And just remind us what proportion of the total group revenues come from those 2 elements. That's the first question. And secondly, I think, you've referred a couple of times about the fourth quarter being a quarter of adjustments. Could you maybe just tell us how much kind of project work or sort of short-term cancelable contracts you have during Q4, maybe you benchmark against what you did perhaps this time last year? And then finally, on Sapient. Maybe going back to one of the earlier questions about visibility on Sapient...

Sorry, I couldn't hear the last question, Omar. The line is very bad. [Technical Difficulty]

We will take our next question from Sarah Simon from Berenberg.

I've got only 2 questions. First one was on the new business table that you showed, can you give us a guess as to how much of that has actually affected your performance year-to-date? Because obviously, there's quite a lag between winning contracts. So I'm wondering how much of that you think has benefited you this year as opposed to how much of it is actually a tailwind into next year. And the second one is on production. You've highlighted this a couple of times in the last few quarters. How much of your creative business is production? And can you give us an idea of the kind of growth that you're seeing specifically in production as opposed to the more kind of traditional part of creative?

Thank you, Sarah. And I'm going to let Michel-Alain give you a flavor about the numbers, and then I'll make some comments on that. But on the 2 questions.

Okay, sure. So on the contribution on the new business, as Arthur has underlined it several times, 2021 was a historically busy year for the new business. We emerged a strong winner, leading the industry by far. And you saw in the last new business table that it continues for the first 9 months of 2022. So when we look at this, we think that new business represents 2% to 3% of our growth this year. We saw faster-than-expected ramp-up in the first 9 months of this year. We told you in H1, and I just want to repeat the fact that we'll continue to be very selective in the opportunities we pursue, focusing on integrating the business we want and continuing to provide the best service to our existing clients. So that was for the new business.

So maybe I'll add one comment on new business, which, of course -- and thank you for the question. The organic growth that new business deliver is important for us, and it's contributing to our overall growth. But what is even more important, and this is something that we are trying to do step by step is to demonstrate how different is our model from competition. And I think today, you have 2 KPIs to look at that. The first is our growth in areas like data and technology with Sapient and Epsilon that we have at scale, 1/3 of our revenue. And hopefully, this gives you a flavor where the growth is for us in the future and, more importantly, the kind of transformation we can bring to our clients. And second, our ability to differentiate from our competitors in our go-to-market when it comes to new business. And this is a very important point for me because when you sit in a room for 2 or 3 hours showing to a client what you can deliver to him versus competition, this is where you can express how competitive, differentiating and really creating value our offer is for our clients. And I think that this new business record is, of course, to take for what it brings in terms of organic growth but also for what it shows in terms of differentiation of our offer. Michel-Alain, production?

Sure. Yes. So on production, you're right. Since the beginning of the year, we have experienced a very strong growth at production, depending the quarter above 20%. It's growing from a relatively small base compared to our competitors. It's representing about 5% to 6% of our total revenue. But as I was telling you, strongly growing throughout the quarter. Arthur?

Yes. It's small when you compare it to our overall revenue, which is bigger when you include it, of course, into our creative business. And this is a very important point because we don't want to leave you with the impression that what we care for in terms of organic growth is only Publicis Sapient and Epsilon. We have very strong growth in media, thanks to the new digital channel we're inventing every day. Advanced TV, for example, and our ability to help our clients with an offer that is called Lift is a source of growth for us and value for our clients. What we are doing in retail media with Citrus that is actually growing triple digit at the moment is another example. And new business is the third. So we continue to grow media pretty significantly. When it comes to creative, I mean, let's be clear, I don't think creative will be accretive to our overall growth. But we do think there is a potential for growth because thanks to production, when you bring together ideation and production, you have a positive model, which is exactly what our client wants because honestly, they want less idea but that they can express in more channels, which means that they need more assets at a cheaper price, deliver faster but with good quality. And this is an area where we can help a lot. So again, we have defined clear path for growth, of course, for our Publicis Sapient, also on Epsilon, but we also know that our creative and media business need to continue to grow -- by the way, helped by Sapient and Epsilon because -- sorry to spend time on that, but this is a very important question, the one you raised. Production today is dynamic. Production is based on data. And so you would see what we're able to put together in terms of platform between our production capabilities and Epsilon to deliver content in a personalized way at scale. This is part of our future and part of our future growth. Omar is back? No?