Omnicom Group Inc. today announced an update related to coronavirus disease 2019 (Covid-19).
John D. Wren, Chairman and Chief Executive Officer of Omnicom, commented in a press release: “We have been closely monitoring the Covid-19 pandemic and its impact on our people, clients and operations. Our primary focus is ensuring the safety and well-being of our people. We have implemented a global work from home policy and the majority of our people around the world are currently working remotely. We also continue to support our clients and the communities impacted. Our teams have pivoted quickly to develop insights and creative ideas that can assist our clients and their customers in this new environment. While it is too early to predict the full impact of the pandemic on our business, we are confident that Omnicom has the expertise and resources necessary to weather this difficult period.
As we focus on the safety of our people and do our part to stop the spread of Covid-19, we continue to evaluate the impact of Covid-19 on our clients and operations, as well as the impact of related government actions such as travel restrictions, limitations on public gatherings, shelter in place orders and mandatory closures. These actions pose a risk that clients may reduce their demand for our services and could result in a reduction in our revenue, which would adversely affect our operations. We have a diversified portfolio of businesses, geographies and clients, some of which will be impacted more significantly than others.
In the current environment, a major priority for us is preserving liquidity. Omnicom’s primary liquidity sources are operating cash flow, cash and cash equivalents and short-term investments. As of December 31, 2019, our cash and cash equivalents and short-term investments totaled $4.3 billion. Omnicom has six tranches of notes approximating $5.1 billion which mature between 2022 and 2031. No more than $1.4 billion of such notes matures in any given year and none of such notes mature prior to May 1, 2022. Although we expect to experience a decrease in our cash flow from operations as a result of the impact of Covid-19, we have a $2.5 billion multi-currency revolving credit facility expiring February 2025 and access to the capital markets that provide us with additional liquidity.
In recent weeks, we have strengthened existing measures to mitigate the effect of Covid-19 on our business, including with respect to our discretionary costs, cash position and liquidity. However, we are unable at this time to predict the impact of Covid-19 on our operations and liquidity, and depending on the magnitude and duration of the Covid-19 pandemic, such impact may be material. We will provide an update on our first quarter earnings release and earnings call”.
