FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ending September 30, 1998 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_____________to________________ Commission file number 1-6686 THE INTERPUBLIC GROUP OF COMPANIES, INC. (Exact name of registrant as specified in its charter) Delaware 13-1024020 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1271 Avenue of the Americas, New York, New York 10020 (Address of principal executive offices) (Zip Code) (212) 399-8000 - (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X . No . Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock outstanding at October 31,1998: 138,984,743 shares. THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES I N D E X PART I. FINANCIAL INFORMATION Page Item 1. Financial Statements Consolidated Balance Sheet September 30, 1998 (unaudited) and December 31, 1997 3-4 Consolidated Statement of Income Three months ended September 30, 1998 and 1997 (unaudited) 5 Consolidated Statement of Income Nine months ended September 30, 1998 and 1997 (unaudited) 6 Consolidated Statement of Comprehensive Income Nine months ended September 30, 1998 and 1997 (unaudited) 7 Consolidated Statement of Cash Flows Nine months ended September 30, 1998 and 1997 (unaudited) 8 Notes to Consolidated Financial Statements (unaudited) 9 - 10 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 11 - 14 PART II. OTHER INFORMATION Item 2. Changes in Securities Item 5. Other Information Item 6. Exhibits and Reports on Form 8-K SIGNATURES INDEX TO EXHIBITS 2
PART I - FINANCIAL INFORMATIONTHE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIESCONSOLIDATED BALANCE SHEET(Dollars in Thousands)ASSETS (unaudited) SEPTEMBER 30, DECEMBER 31, 1998 1997 <F1> Current Assets: Cash and cash equivalents (includes certificates of deposit: 1998-$104,194; 1997-$256,934) $ 621,698 $ 735,440 Marketable securities, at cost which approximates market 46,440 31,944 Receivables (less allowance for doubtful accounts: 1998-$52,161; 1997-$39,896) 3,152,671 3,050,917 Expenditures billable to clients 314,666 240,000 Prepaid expenses and other current assets 156,530 105,504 Total current assets 4,292,005 4,163,805 Other Assets: Investment in unconsolidated affiliates 51,183 46,665 Deferred taxes on income 65,242 59,424 Other investments and miscellaneous assets 229,513 219,839 Total other assets 345,938 325,928 Fixed Assets, at cost: Land and buildings 88,202 83,621 Furniture and equipment 573,648 503,823 661,850 587,444 Less accumulated depreciation 378,570 330,593 283,280 256,851 Unamortized leasehold improvements 111,123 103,494 Total fixed assets 394,403 360,345 Intangible Assets (less accumulated amortization: 1998-$268,878; 1997-$227,401) 1,172,387 1,027,527 Total assets $6,204,733 $5,877,605 3
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIESCONSOLIDATED BALANCE SHEET(Dollars in Thousands Except Per Share Data)LIABILITIES AND STOCKHOLDERS' EQUITY (unaudited) SEPTEMBER 30, DECEMBER 31, 1998 1997 <F1> Current Liabilities: Payable to banks $ 227,104 $ 162,807 Accounts payable 3,193,273 3,156,049 Accrued expenses 465,432 448,054 Accrued income taxes 176,968 151,138 Total current liabilities 4,062,777 3,918,048 Noncurrent Liabilities: Long-term debt 262,211 253,910 Convertible subordinated debentures 201,847 201,768 Deferred compensation and reserve for termination allowances 280,811 263,463 Accrued postretirement benefits 48,049 47,404 Other noncurrent liabilities 64,266 70,791 Minority interests in consolidated subsidiaries 52,274 31,917 Total noncurrent liabilities 909,458 869,253 Stockholders' Equity: Preferred Stock, no par value shares authorized: 20,000,000 shares issued:none Common Stock, $.10 par value shares authorized: 225,000,000 shares issued: 1998 - 145,365,365 1997 - 143,567,843 14,537 14,357 Additional paid-in capital 665,282 552,282 Retained earnings 1,134,785 995,702 Adjustment for minimum pension liability (13,207) (13,207) Net unrealized gain on equity securities 10,017 12,405 Cumulative translation adjustment (136,483) (154,093) 1,674,931 1,407,446 Less: Treasury stock, at cost: 1998 - 9,055,137 shares 1997 - 8,063,983 shares 371,169 253,088 Unearned ESOP compensation - 7,420 Unamortized expense of restricted stock grants 71,264 56,634 Total stockholders' equity 1,232,498 1,090,304 Total liabilities and stockholders' equity $6,204,733 $5,877,605 The accompanying notes are an integral part of these consolidated financial statements. <F1> Restated to reflect the aggregate effect of acquisitions accounted for as poolings of interests. See Note (c). 4
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (unaudited) THREE MONTHS ENDED SEPTEMBER 30 (Dollars in Thousands Except Per Share Data) 1998 1997 <F1> Revenue $ 837,371 $ 710,872 Other income 24,077 22,086 Gross income 861,448 732,958 Costs and expenses: Operating expenses 759,869 660,465 Interest 14,210 14,343 Total costs and expenses 774,079 674,808 Income before provision for income taxes 87,369 58,150 Provision for income taxes 38,207 26,124 Income of consolidated companies 49,162 32,026 Income applicable to minority interests (5,488) (3,403) Equity in net income of unconsolidated affiliates 1,488 2,460 Net income $ 45,162 $ 31,083 Weighted average shares: Basic 132,792,504 127,078,261 Diluted 137,567,041 132,181,681 Earnings Per Share: Basic $ .34 $ .24 Diluted $ .33 $ .24 Dividend per share - Interpublic $ .15 $ .13 The accompanying notes are an integral part of these consolidated financial statements. <F1> Restated to reflect the aggregate effect of acquisitions accounted for as poolings of interests. See Note (c). 5
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (unaudited) NINE MONTHS ENDED SEPTEMBER 30 (Dollars in Thousands Except Per Share Data) 1998 1997 <F1> Revenue $ 2,541,729 $ 2,177,268 Other income 67,382 60,345 Gross income 2,609,111 2,237,613 Costs and expenses: Operating expenses 2,211,957 1,924,630 Interest 37,819 36,347 Total costs and expenses 2,249,776 1,960,977 Income before provision for income taxes 359,335 276,636 Provision for income taxes 150,846 114,142 Income of consolidated companies 208,489 162,494 Income applicable to minority interests (14,688) (14,185) Equity in net income of unconsolidated affiliates 3,554 5,425 Net income $ 197,355 $ 153,734 Weighted average shares: Basic 132,704,118 126,991,427 Diluted 137,783,816 136,285,448 Earnings Per Share: Basic $ 1.49 $ 1.21 Diluted $ 1.44 $ 1.17 Dividend per share - Interpublic $ .43 .37 The accompanying notes are an integral part of these consolidated financial statements. <F1> Restated to reflect the aggregate effect of acquisitions accounted for as poolings of interests. See Note (c). 6
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (unaudited) NINE MONTHS ENDED SEPTEMBER 30 (Dollars in Thousands) 1998 1997 <F1> Net Income $ 197,355 $ 153,734 Other Comprehensive Income, net of tax: Foreign Currency Translation Adjustments 17,610 (54,509) Net Unrealized Gains on Securities (2,388) - Other Comprehensive Income 15,222 (54,509) Comprehensive Income $ 212,577 $ 99,225 The accompanying notes are an integral part of these consolidated financial statements. <F1> Restated to reflect the aggregate effect of acquisitions accounted for as poolings of interests. See Note (c). 7
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited) NINE MONTHS ENDED SEPTEMBER 30 (Dollars in Thousands) CASH FLOWS FROM OPERATING ACTIVITIES: 1998 1997 <F1> Net income $ 197,355 $ 153,734 Adjustments to reconcile net income to cash provided by/(used in) operating activities: Depreciation and amortization of fixed assets 64,248 54,726 Amortization of intangible assets 41,477 26,674 Amortization of restricted stock awards 14,634 11,883 Equity in net income of unconsolidated affiliates (3,554) (5,425) Income applicable to minority interests 14,688 14,185 Translation losses 854 743 Net gain from sale of investments (7,579) - Other (2,764) (7,790) Changes in assets and liabilities, net of acquisitions: Receivables 4,289 47,105 Expenditures billable to clients (70,490) (90,751) Prepaid expenses and other assets (29,472) (4,737) Accounts payable and other liabilities (66,665) (143,338) Accrued income taxes 3,817 (24,443) Deferred income taxes (3,436) 2,328 Deferred compensation and reserve for termination allowances 2,249 930 Net cash provided by operating activities 159,651 35,824 CASH FLOWS FROM INVESTING ACTIVITIES: Acquisitions (83,857) (79,494) Capital expenditures (83,281) (72,389) Proceeds from sale of assets 22,518 590 Net purchases of marketable securities (9,331) (14,933) Other investments and miscellaneous assets (4,146) (4,169) Investments in unconsolidated affiliates (7,923) (5,742) Net cash used in investing activities (166,020) (176,137) CASH FLOWS FROM FINANCING ACTIVITIES: Increase in short-term borrowings 75,002 11,725 Proceeds from long-term debt 6,535 253,212 Payments of long-term debt (22,101) (25,642) Treasury stock acquired (148,639) (106,163) Payments from Unearned ESOP 7,420 - Issuance of common stock 26,795 31,589 Cash dividends - Interpublic (56,557) (44,932) Cash dividends - pooled - (7,158) Net cash (used in)/provided by financing activities (111,545) 112,631 Effect of exchange rates on cash and cash equivalents 4,172 (25,261) Decrease in cash and cash equivalents (113,742) (52,943) Cash and cash equivalents at beginning of year 735,440 507,394 Cash and cash equivalents at end of period $ 621,698 $ 454,451 The accompanying notes are an integral part of these consolidated financial statements. <F1> Restated to reflect the aggregate effect of acquisitions accounted for as poolings of interests. See Note (c). 8
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 1. Consolidated Financial Statements (a) In the opinion of management, the consolidated balance sheet as of September 30, 1998, the consolidated statements of income for the three months and nine months ended September 30, 1998 and 1997, the statement of comprehensive income for the nine months ended September 30,1998 and 1997, and the consolidated statement of cash flows for the nine months ended September 30, 1998 and 1997, contain all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows at September 30, 1998 and for all periods presented. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted. It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in The Interpublic Group of Companies, Inc.'s (the "Company") December 31, 1997 annual report to stockholders and with the supplemental consolidated financial statements and notes thereto included in the Company's Current Report on Form 8-K dated July 1, 1998. (b) Statement of Financial Accounting Standards (SFAS) No. 95 "Statement of Cash Flows" requires disclosures of specific cash payments and noncash investing and financing activities. The Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents. Income tax cash payments were approximately $140.1 million and $91.1 million in the first nine months of 1998 and 1997, respectively. Interest payments during the first nine months of 1998 were approximately $27.0 million. Interest payments during the comparable period of 1997 were approximately $22.1 million. (c) In April 1998, the Company issued 4,685,334 shares of its common stock for three acquisitions, which were accounted for as poolings of interests. These included Hill, Holliday, Connors, Cosmopulos Inc. - 2,062,434 shares, The Jack Morton Company - 2,135,996 shares and Carmichael Lynch Inc. - 486,904 shares. The Company's 1997 consolidated financial statements, including the related notes, have been restated to include the results of operations, financial position and cash flows of the April 1998 pooled entities in addition to all prior pooled entities. (d) In June 1998, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" (SFAS No. 133). SFAS No. 133 is effective for all fiscal quarters of all fiscal years beginning after June 15, 1999 (January 1, 2000 for the Company). SFAS No. 133 requires that all derivative instruments be recorded on the balance sheet at their fair value. Changes in the fair value of derivatives are recorded each period in current earnings or other comprehensive income, depending on whether a derivative is designated as part of a hedge transaction and, if it is, the type of hedge transaction. Management of the Company believes that the adoption of SFAS No. 133 will not have a material impact on the Company's results of operations or its financial position. 9
(e) Subsequent event Effective October 1998, the Company acquired International Public Relations, plc. 10
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS LIQUIDITY AND CAPITAL RESOURCES Working capital at September 30, 1998 was $229.2 million, a decrease of $16.5 million from December 31, 1997. The ratio of current assets to current liabilities remained relatively unchanged from December 31, 1997 at approximately 1.1 to 1. Historically, cash flow from operations has been the primary source of working capital and management believes that it will continue to be in the future. The principal use of the Company's working capital is to provide for the operating needs of its advertising agencies, which include payments for space or time purchased from various media on behalf of its clients. The Company's practice is to bill and collect from its clients in sufficient time to pay the amounts due media. Other uses of working capital include the payment of cash dividends, acquisitions, capital expenditures and the reduction of long-term debt. In addition, during the first nine months of 1998, the Company acquired 2,659,065 shares of its own stock for approximately $148.6 million for the purposes of fulfilling the Company's obligations under its various compensation plans. 11
RESULTS OF OPERATIONSThree Months Ended September 30, 1998 Compared to Three Months Ended September 30, 1997Total revenue for the three months ended September 30, 1998 increased $126.5 million, or 17.8%, to $837.4 million compared to the same period in 1997. Domestic revenue increased $65.1 million or 18.0% from 1997 levels. Foreign revenue increased $61.4 million or 17.6% during the third quarter of 1998 compared to 1997. The impact of foreign currency was negligible for the three months ended September 30, 1998. Other income increased by $2.0 million during the third quarter of 1998 compared to the same period in 1997. Operating expenses increased $99.4 million or 15.1% during the three months ended September 30, 1998 compared to the same period in 1997. Interest expense decreased 0.9% as compared to the same period in 1997. Included in operating expenses were net losses from exchange and translation of foreign currencies of $.4 million and $3.1 million in 1998 and 1997, respectively. Pretax income increased $29.2 million or 50.2% during the three months ended September 30, 1998 compared to the same period in 1997. The increase in total revenue, operating expenses, and pretax income is primarily due to the effect of new business gains and acquisitions. The effective tax rate for the three months ended September 30, 1998 was 43.7%, as compared to 44.9% in 1997. The difference between the effective and statutory rates is primarily due to foreign losses with no tax benefit, losses from translation of foreign currencies which provided no tax benefit, state and local taxes, foreign withholding taxes on dividends and nondeductible goodwill expense. Nine Months Ended September 30, 1998 Compared to Nine Months Ended September 30, 1997 Total revenue for the nine months ended September 30, 1998 increased $364.5 million, or 16.7%, to $2,541.7 million compared to the same period in 1997. Domestic revenue increased $215.7 million or 19.9% from 1997 levels. Foreign revenue increased $148.8 million or 13.6% during the first nine months of 1998 compared to 1997. Worldwide revenue would have increased an additional 3.1% in 1998 except for the strengthening of the U.S. dollar against major currencies. Other income increased $7.0 million in the first nine months of 1998 compared to the same period in 1997. Operating expenses increased $287.3 million or 14.9% during the nine months ended September 30, 1998 compared to the same period in 1997. Interest expense increased 4.0% during the nine months ended September 30, 1998 as compared to the same nine month period in 1997. Included in operating expenses were net losses from exchange and translation of foreign currencies of $2.6 million and $4.5 million in 1998 and 1997, respectively. Pretax income increased $82.7 million or 29.9% during the nine months ended September 30, 1998 compared to the same period in 1997. The increase in total revenue, operating expenses, and pretax income is primarily due to the effect of new business gains and acquisitions offset by the impact of foreign currency. The effective tax rate for the nine months ended September 30, 1998 was 42.0%, as compared to 41.3% in 1997. 12
Year 2000 Issue The Year 2000 Issue refers to the problem caused by computer programs that have been written to reflect two digit years, with the century being assumed as "19". This practice was widely accepted by the applications development community in the 1960's through the early 1980's, with many of these programs remaining in use today. As a result, programs that are date sensitive may recognize the year "00" as 1900, rather than the year 2000. This may cause programs to fail or cause them to incorrectly report and accumulate data. IPG and each of its operating subsidiaries are in the process of implementing a Year 2000 readiness program with the goal of having all mission critical systems functioning properly prior to January 1, 2000. Many of our subsidiaries in our larger markets are dependent upon third party systems providers, while our subsidiaries in the secondary markets rely primarily on off-the-shelf applications or home-grown applications. Considerable progress has been made with our third party systems providers in larger markets. Although the secondary markets present a greater challenge, they typically involve smaller offices that are less dependent upon automated solutions. In 1997 IPG established a Y2K Project Management Office and shortly thereafter created a Y2K Task Force, comprised of representatives from the operating companies. Through the Y2K Task Force, IPG in conjunction with outside consultants, is working to address the impact of the Year 2000 Issue on IPG. IPG is inventorying and assessing date sensitive computer software applications, with initial indications being that approximately 35% of systems will require remediation. In addition, IPG has reviewed a large majority of our hardware containing embedded chips, including personal computers, file servers, mid-range and mainframe computers, telephone switches and routers. We have also reviewed the majority of our security systems, life safety systems, HVAC systems and elevators in our facilities. As part of this effort, IPG has identified those systems and applications that are deemed "mission critical", which we are handling on a priority basis. Utilizing this approach has allowed us to make considerable progress in our larger offices that in aggregate contribute to most of our revenue. We have developed a detailed project and remediation plan that includes system testing schedules and contingency planning that are designed to achieve our goal of having all "mission critical" elements remedied and compliance tested by December 31, 1998. We are currently well into the remediation and testing stage. The Company's Board of Directors, through the Audit Committee, has been monitoring progress of this project. Project progress reports are given to the Audit Committee at each regularly scheduled Audit Committee meeting. IPG estimates that the modification and testing of our hardware and software will cost approximately $10 million, of which 50% has been spent to date in order to meet the Y2K compliance deadline. In addition, IPG has accelerated the implementation of a number of business process reengineering projects over the past few years that have provided both Year 2000 readiness and increased functionality of certain systems. IPG estimates that the hardware and software costs incurred in connection with these projects is approximately $50 million, which is being capitalized. Included in the abovementioned Y2K costs are internal costs incurred for the Y2K project which are primarily related payroll costs for the information systems groups. A substantial portion of these estimated costs relate to systems and applications that were anticipated and budgeted. 13
IPG is also in the process of developing contingency plans for affected areas of our operation. The Y2K Project Management Office has drafted a Contingency Plan Guideline. This guideline requires the development of contingency plans for applications, vendors, facilities, business partners and clients. The contingency plans will cover those "mission critical" elements that are not Year 2000 compliant by December 31,1998. In addition, the contingency plans will include procedures for workforce mobilization, crisis management, disaster recovery and damage control, which are targeted for completion by March of 1999. The Company is assessing the Year 2000 readiness of material third parties by asking all vendors, business partners and facility managers to provide letters of compliance. In addition, IPG is working with the American Association of Advertising Agencies and other trade associations to form Year 2000 working groups that are addressing the issues on an industry level. IPG efforts to address the Year 2000 Issue are designed to avoid any material adverse effect on our operations or financial condition. Notwithstanding these efforts, however, there is no assurance that IPG will not encounter difficulties due to the Year 2000 Issue. The "most reasonably likely worst case scenario" would be a significant limitation on our ability to continue to provide business services. IPG also recognizes that it is dependent upon infrastructure services and third parties, including suppliers, broadcasters and business partners, whose failure may also significantly impact our ability to provide business services. Cautionary Statement Statements by IPG in this Form 10-Q and in other contexts concerning its Year 2000 compliance efforts that are not historical fact are forward- looking statements as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements, including, but not limited to, the following: (i) uncertainties relating to the ability of IPG to identify and address Year 2000 issues successfully and in a timely manner and at costs that are reasonably in line with IPG's estimates; and (ii) the ability of IPG's vendors, suppliers, other service providers and customers to identify and address successfully their own Year 2000 issues in a timely manner. 14
PART II - OTHER INFORMATION Item 2. CHANGES IN SECURITIES (1) On July 20, 1998, the Registrant acquired a company in consideration for which it issued a total of 152,760 shares of its common stock par value $.10 per share ("Interpublic Stock"), to the acquired company's former shareholder. The shares of Interpublic Stock had a market value of $9,200,000 on the date of issuance. The shares of Interpublic Stock were issued by the Registrant without registration in reliance on Rule 506 of Regulation D under the Securities Act of 1933, as amended (the "Securities Act"), based on the accredited investor status or sophistication of the former shareholder of the acquired company. (2) On September 17, 1998, the Registrant acquired 80% of a company in consideration for which it issued a total of 16,452 shares of Interpublic Stock, to the acquired company's former shareholders. The shares of Interpublic Stock had a market value of $800,000 on the date of issuance. The shares of Interpublic Stock were issued by the Registrant without registration in reliance on Rule 506 of Regulation D under the Securities Act, based on the accredited investor status or sophistication of the acquired company's former stockholders. Item 5. OTHER INFORMATION The deadline is March 4, 1999 for notification of the Registrant by stockholders of proposals under Rule 14a-4 of the Securities and Exchange Commission. Item 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) EXHIBITS Exhibit 10 Executive Severance Agreement, dated January 1, 1998, between The Interpublic Group of Companies, Inc. ("Interpublic") and Frank B. Lowe. Exhibit 11 Computation of Earnings Per Share. Exhibit 27 Financial Data Schedule. 15
(b) Reports on Form 8-K (1) The following reports on Form 8-K were filed without financial statements during the quarter ended September 30, 1998: (a) Item 9 - Sale of Equity Securities Pursuant to Regulation S, dated June 24, 1998. (b) Item 9 - Sale of Equity Securities Pursuant to Regulation S, dated July 23, 1998. (c) Item 9 - Sale of Equity Securities Pursuant to Regulation S, dated August 5, 1998. (d) Item 9 - Sale of Equity Securities Pursuant to Regulation S, dated August 24, 1998. (2) The following reports on Form 8-K were filed with financial statements during the quarter ended September 30, 1998: (a) Item 5 - Other Events and Item 7 - Financial Statements and Exhibits, dated July 1, 1998. Supplemental Financial Statements of the Registrant At and For the Period Ended December 31, 1997 and Supplemental Financial Statements At and For the Period Ended March 31, 1998. (b) Item 5 - Other Events and Item 7 - Financial Statements and Exhibits, dated July 17, 1998. Interim Results For the Six Months Ended April 30, 1998 of a company subsequently acquired by Registrant. (c) Item 5 - Other Events and Item 7 - Financial Statements and Exhibits, dated July 27, 1998. Financial Statements of the Registrant At and For the Period Ended June 30, 1998. 16
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 thereunto duly authorized. THE INTERPUBLIC GROUP OF COMPANIES, INC. (Registrant) Date: November 13, 1998 BY /S/ PHILIP H. GEIER, JR. PHILIP H. GEIER, JR. Chairman of the Board President and Chief Executive Officer Date: November 13,1998 BY /S/ EUGENE P. BEARD EUGENE P. BEARD Vice Chairman - Finance and Operations 17
INDEX TO EXHIBITS EXHIBIT NO. DESCRIPTION Exhibit 10 Executive Severance Agreement, dated January 1, 1998, between Interpublic and Frank B. Lowe. Exhibit 11 Computation of Earnings Per Share. Exhibit 27 Financial Data Schedule 18