Michael I. Roth - Chairman of the Board, Chief Executive Officer Frank Mergenthaler - Chief Financial Officer, Executive Vice President Jerry Leshne - Senior Vice President of Investor Relations

Alexia Quadrani - J.P. Morgan John Janedis - Wachovia Capital Markets, LLC Craig Huber - Lehman Brothers Brian Shipman - Jefferies & Co. Troy Mastin - William Blair & Company, LLC Michael Nathanson - Stanford & Bernstein Dan Salmon - BMO Capital Markets Matt Chesler - Deutsche Bank Securities Benjamin Schachter - UBS [Jonathan Cohen] Andrew Berg - Post Advisory Group Catriona Fallon - Citigroup Leo Schmidt - The CHUBB Corporation

Welcome to the Interpublic Group second quarter 2008 earnings conference call. (Operator Instructions) I would now like to introduce Mr. Jerry Leshne, Senior Vice President of Investor Relations.

Thank you for joining us. We have posted our earnings release and our slide presentation on our website www.interpublic.com and will refer to both in the course of this call. This morning we are joined by Michael Roth and Frank Mergenthaler. We will begin with prepared remarks to be followed by Q&A. We plan to conclude before market open at 9:30 AM Eastern. During this call we will refer to forward-looking statements about our company which are subject to uncertainties in the cautionary statement that is included in our earnings release and our slide presentation and further detailed in our 10K and other filings with the SEC. At this point it is my pleasure to turn things over to Michael Roth. Michael I. Roth: Thank you all for joining us this morning as we review our results for the second quarter and first half of 2008. I’ll begin by covering the highlights of our performance; Frank will then take us through the results in detail; and after his remarks I will return with closing comments before we move on to the Q&A. Obviously we are very pleased with the results that we are sharing with you today. Our performance in the second quarter and first half of 2008 was the strongest that IPG has delivered in many years. Organic revenue growth of 6.3% in the quarter is something we can be proud of and the 5.8% number for the first half is clearly competitive with the industry. All of our major units are contributing to this growth which goes to show that the strategic actions we’ve been taking and the continued focus on developing and recruiting top talent are in fact making our offerings more powerful in the market place. McCann Worldgroup is strong overall and continues to perform at a high level, as did CMG led by Weber Shandwick, GolinHarris, Jack Morton and Octagon. Draftfcb had a very solid first half as did our US independents. Our media brands continue to make major strides in terms of people, product and results. Lowe has not only won significant business of late particularly from its large multinational clients but is on target to post a profit for the full year which is consistent with one of our primary objectives for the year. In terms of geography our international organic growth was very strong this quarter and is evident in every region in which we operate. There was also strength internationally across all our disciplines. We have stated previously that we were focused on improving performance internationally and we will continue to keep working against this goal. We will also continue to look for opportunities to strengthen our capabilities in high growth markets or regions through acquisitions. I’ll have a little more to say about that in my closing comments. Turning to operating margin, we saw good improvement from 8.8% in the second quarter of 2007 to 10.9% this year. For the past few quarters we’ve shared with you a trailing 12-month margin calculation and that chart once again is in Frank’s presentation, and you will see that it once again demonstrates we’re making significant progress in terms of improving profitability. As a result of our continued improvement on both the top line and in our ability to drive profitability we saw the second quarter operating income rise from $146 million in 2007 to $201 million this year. For the first six months, which include the seasonal loss we typically see in the first quarter, operating income jumped from $21 million in 2007 to $143 million this year. These dramatically improved bottom line results tell us that the people and processes we have put in place across the organization have given us more effective financial controls. We also have better visibility into the organization and greater confidence that we have the right tools with which to run our business day to day. We often call out the fact that performance during a turnaround is not linear and warn you against projecting future results based on a given quarter. This is especially true in light of the economic uncertainty that we are all seeing out there. While we were pleased with the first half results, we are approaching the back half of the year conservatively and will proactively manage costs in order to achieve our margin targets. However, we can reiterate that we remain on track to achieve our 2008 financial objectives. Now I’ll hand things over to Frank for the full details on our results during the first six months.

Let me remind everyone that the presentation slides which accompany our remarks are available on our website. As Michael indicated in his comments, we are very pleased with our performance in the second quarter and year-to-date. Among highlights in the quarter consolidated organic revenue growth was 6.3% reflecting strong international growth as well as solid growth domestically against a very strong comparable quarter a year ago. Operating income increased 38% to $201 million. Operating margin expanded to 10.9% from 8.8% reflecting improved leverage on both of our principal operating expense lines. Cash flow from operations in the quarter increased to $399 million from $44 million a year ago. Our diluted earnings per share were $0.17 compared with $0.24 in Q207 which included a net tax benefit of $11 million related to a tax reserve reversal of approximately $80 million. Excluding that item comparable earnings per share a year ago would have been approximately $0.09. Turning to Slide 3, you can see our complete P&L for the quarter. I’ll cover revenue and operating expenses in detail on the slides that follow. On Slide 4 we provide additional detail on revenue. Reported revenue in the quarter was $1.84 billion an increase of 11.1%. Compared to Q207 exchange rates had a positive impact of 4.1% while net business acquisitions added 0.6%. Organic revenue growth of 6.3% compares to 6.6% in Q207. Growth was attributable both to higher revenue from existing clients and from net new business wins. On the bottom half of this slide you can see that both operating segments performed well in the quarter. At our integrated agency networks reported revenue grew 11.5% and the organic increase was 6.1%. Growth was solid across most disciplines led by media, digital and activation as well as advertising. At our constituency management group reported revenue grew 8.7% and the organic increase was 7.5%. We again saw strong performance in our public relations and event marketing businesses. Slide 5 provides a breakdown of Q2 revenue growth by region. In the US revenue increased 3.2% organically. We had growth across our full-range of advertising and marketing disciplines led by McCann World Group and our public relation agencies Weber Shandwick, GolinHarris, and major increases in most major client industry sectors. The general tone of business in the US remained solid in Q2; 3.2% growth compared sequentially to 5.2% in Q1 of this year but our comparable Q2 last year in the US was an extraordinary 10.7%. Internationally reported revenue growth was 21% which includes a significant currency lift. Organic growth of 10.6% marks our best quarter outside the US in many years and that brings the six months to 8.1%. Growth in the quarter was diversified with double-digit organic increase in four of our five regions. It is especially gratifying that the growth was led by Media as well as McCann Worldgroup and Jack Morton. In the UK organic growth was 11.5% led by Lowe and Jack Morton which is attributable to new business and higher existing client revenue. In Continental Europe organic growth was 4.2% paced by our Media brands and McCann with new client wins and increases from existing clients. Among the largest national markets we had increases in Germany, Spain and Italy while revenue in France declined. In Asia Pac Q2 organic revenue growth was 13.7% led again by Media, McCann and Morton with strong gains in China and Australia. In Latin America organic revenue growth was 15.1% led by Draftfcb on the strength of new client wins and McCann. On Slide 6 we present a longer view of organic revenue growth that tracks a trailing 12-month basis. As you can see over the past two and a half years organic revenue growth has trended up strongly and was 4.5% for the most recent period. On Slide 7 we move on to a closer look at operating expenses. In aggregate we drove over 200 basis points of consolidated operating expense leverage in the quarter. Salaries and related expenses were $1.1 billion in the quarter, 60.1% of revenue compared to 61.1% of revenue a year ago an improvement of 100 basis points. Breaking that down, as you will see in the Appendix to our presentation slides, leverage on base salaries and benefits improved 100 basis points and was the largest driver of our improvement. At the same time temporary help also declined by 30 basis points as a percentage of revenue. Our incentive expense increased from a year ago mainly due to the cumulative effect of improved performance against our financial objectives. At 3.9% of revenue in the quarter the incentive expense ratio was a bit higher than we would expect for the full year. Severance expense declined to 60 basis points from 100 a year ago. Office and general expenses on the lower half of this slide were $528 million, 28.8% of revenue compared with 30.4% of revenue a year ago. All major cost categories in O&G decreased as a percentage of revenue. The key driver was improved leverage on occupancy expense which declined 80 basis points as a percentage of revenue. This is the result of ongoing operating disciplines and cost actions taken in 2007. On Slide 8 we show continuing progress on operating margin on a trailing 12-month basis, one of our primary financial objectives. This excludes past restructuring of impairment charges in order to capture the trend in the underlying results. Q2 was our eighth consecutive quarter of improvement, and as you can see adjusted operating margin over the last 12 months was 7.4%. On Slide 9 we turn to cash flow for the second quarter. For the quarter cash generated from operations was $399 million compared with $44 million in Q207. For the six months operations generated cash of $111 million compared with a use of $339 million a year ago. Our significant improvement in Q2 was largely due to improved cash from working capital. Highlighted in yellow Q2 cash from working capital was $183 million compared to a use of $133 million a year ago. This performance is the result of growth in certain businesses and improved working capital management in certain of our operating units. As we have pointed out on prior calls, we would caution about focusing too much on performance in a single quarter. In this case there is a good deal of quarterly variation that is inherent in working capital results. So while our efforts on driving improvement remain a work in progress, we are encouraged and pleased with the results in the quarter. Moving on, the adjustment for deferred taxes was $47 million compared with a -$17 million a year ago. We continue to utilize steadily higher amounts of deferred tax assets which originated from prior period operating losses. The net change in cash and marketable securities in Q2 was an increase of $344 million compared with a decrease of $38 million a year ago. Turning to our balance sheet on Slide 10, you can see that we ended Q2 with $1.9 billion in cash and short-term marketable securities. That is an increase of $375 million from a year ago notwithstanding our repurchase of $191 million convertible debt in the first quarter of this year. Our debt maturity schedule as of quarter end is presented on Slide 11. Total debt at quarter end was $2.1 billion with maturities that are well distributed going forward. We are very pleased to have entered into a new revolving credit facility with a group of leading banks. We thank them for their support. The facility is essentially a plain vanilla revolver with capacity of $335 million and a three-year term at competitive costs and is available for general corporate purposes. We believe that it provides us with significant financial flexibility while it includes covenants and conditions typical of a facility of this nature. We believe it is particularly important to be proactive in the credit environment to secure replacement back stop liquidity in anticipation of the ELF maturity in June of next year. This should substantially eliminate any concern there may have been about another equity linked facility and is a welcome endorsement of our financial progress by the credit community. In summary, on Slide 12 this is our best Q2 and first half operating performance in many years. These results demonstrate the broad competitiveness of our offerings and we believe our ability to sustainably drive higher levels of shareholder value. Through the first six months we are tracking well against our full-year 08 financial objectives of competitive organic growth and 8.5% to 9% operating margin. As Michael indicated we are aware of the broader economic situation. As a matter of operating and financial discipline we are therefore already holding our agencies to a standard that assumes the need to manage toward our margin target. These include being aggressive on any discretionary expenses, hiring only under realized new revenue, and carefully managing temporary labor. We are optimistic that our strongly improved financial visibility and control will enable us to deliver on our financial objectives for the year. Now let me turn it back over to Michael. Michael I. Roth: As you can see, our performance for Q2 and the first half was strong and represents a good start to 2008. We posted competitive organic revenue growth with additional assignments from existing clients as well as new business wins. The growth was balanced across world regions and across the marketing disciplines. We continued to see demand for digital, marketing services, integrated solutions, and high value strategic thinking in advertising and media as well as strong capabilities in the emerging economies. In connection with a couple of these key growth drivers there are two events that took place after the end of the second quarter that bear mention here. As you may have seen yesterday we announced that we have moved forward from a minority to a majority position in the Middle East Communications Network or MCN. MCN is the premier marketing services group in the Middle East/North Africa region with over 60 offices in 14 countries. They have been our partner for decades and work closely with a full-range of our agency brands across all brands of marketing. The group also includes a number of powerful local agencies. MCN operates in one of the world’s fastest-growing regions with over 300 million people; very high per capital GDP and projected advertising expenditures that are growing at rates in line with markets such as India, China and Russia. That’s what makes this such a compelling opportunity for us. It’s also why we’re excited that stepping up our partnership with MCN will further our leadership position in this dynamic region. A second and equally strategic transaction that we will announce later this morning is in the digital arena. Marketing services in the interactive space are fast evolving beyond site development and interface design. Our clients no longer think of digital as just a messaging medium. They are looking to the web and other emerging media to provide consumers with experiences and functionality that drive their business. One agency that figured this out early on and was able to combine technology expertise with creativity and has been a success story as a result is HUGE. Founded in 1999 they operate in New York, Los Angeles, Atlanta and London. The online businesses they’ve designed and developed for clients like Jet Blue, Scholastic, IKEA, and Warner Music generate more than $3.5 billion in annual revenue for those clients. We see significant opportunities for HUGE to partner with our agencies, expand its geographic footprint, and deliver their unique process in e-commerce platforms to many of our clients. We’re very pleased to have another terrific digital agency join the IPG family. With all of our past legacy issues behind us, it’s great to be on a call talking to you about strong results for the first half of the year and acquisitions that will position us well for the future. But we’re also keeping a close eye on the balance of 2008. Of course the question we are regularly asked is: When will the industry see the effects of the broader economic climate? We are not immune to the macro environment. We will certainly see certain client sectors affected and some countries feel the effect more than others as we move through this period of uncertainty. While we acknowledge the risk inherent in the macroeconomic environment, we believe that our model based on the full range of marketing disciplines and broad geographic presence will provide some degree of protection. Further, by managing our businesses with respect to their margins we believe we can deliver on our objectives for 2008 and enhance long-term shareholder value. With that I’d like to thank you for being with us and open up the floor for questions.

(Operator Instructions) Our first question comes from Alexia Quadrani - J.P. Morgan. Alexia Quadrani - J.P. Morgan: Could you please give us some more color on what you’re hearing from your larger clients in terms of their plans for spending in the second half? Any reason to expect any significant change from what you’ve seen year to date or do you think it will be more of a gradual pullback in some sectors? And then if you can also discuss how much of a headwind your auto clients were in, in the quarter and how much you expect that to be in the back half? Michael I. Roth: Obviously my remarks about the macroeconomic environment take all of that into consideration. Our big clients are continuing to see this as an opportunity to build brand by spending. I think we’ve heard a lot and you’ve read a lot about companies that are reporting earnings and continuing to spend money on advertising. So we haven’t seen a major pullback. Obviously there’s some pullback in local markets and it’s a geographic and project-oriented pullback but on the macro basis we have not seen major pullbacks as of yet. As far as the automotive, obviously we knew there were concerns in that area. Obviously the announcements of General Motors have some impact on us, but when we do our budgeting and forecasting for the year we take all of that into consideration. We work very closely with General Motors and we view that as an opportunity to help them in this challenging environment. Alexia Quadrani - J.P. Morgan: It looks like your marketing services business, obviously you saw some very good growth in the quarter, would you say there’s been a share shift away from maybe what your clients are spending and more of the branding to the marketing services area? Do you think that’s a trend? Michael I. Roth: There’s no question that we’re seeing additional money being spent in marketing services. Some of it is at the expense of traditional advertising but that’s what the integrated offering is all about and that’s why we’ve invested in all these growth areas by adding our tools to it and sufficient amount of expertise and talent in those markets. Alexia Quadrani - J.P. Morgan: I guess put a different way, would you say the shift is accelerating because of the macroeconomic climate or not necessarily? And then just my last question is, if Frank can maybe give us an update on your thinking of use of cash? You’ve made these new investments this week. Is putting back the dividend or buy-back next year a possibility or you’d rather really focus on investments? Michael I. Roth: Well I think the increased spend in marketing services was taking place even before the issues of macro environment, which is why we’ve invested in these growth areas. So I don’t think it’s necessarily tied to it but certainly our clients are willing to spend more in those markets because frankly a lot of the return on investment calculations and tools are applicable to there, so they want to see immediate benefit of their spend. Let me address the question of our cash. We’ve said this all along. We’re still in the process of completing our turnaround and 2008 is a critical year for us. Our strong balance sheet is doing us well in this difficult environment. The fact that we were able to tap the credit markets was an example of how the credit markets view our financial stability and strength. And after we complete 2008 we’ll take a hard look at our use of cash and to the extent we can look at buy-backs and dividends, that’s obviously high on our list. As far as our acquisitions go, we’re consistent. We’ve said we will spend around $150 million. These acquisitions that were announced yesterday and today are totally consistent with that and we don’t see any major changes in that going forward.

Our next question comes from John Janedis - Wachovia Capital Markets, LLC. John Janedis - Wachovia Capital Markets, LLC: It seems like your international growth is really starting to come together over the past couple of quarters. Can you provide a little more color particularly in the UK and France?

In the UK we have made a number of investments on key hires in the UK over the past three years. We had some businesses that were underperforming and we’re starting to see those businesses turn around. So we’re pleased with the progress in the UK. A similar situation in France where we had a number of businesses that we’ve invested behind but it’s a very challenging market for us. And unlike the rest of the region, we saw growth decline. It’s a market we’ll still participate in, we’ll still invest behind, but I think that Europe in the aggregate is in a much stronger place for us today than it was say two years ago. Michael I. Roth: It’s worth noting the improvement of Lowe in particular in the UK. The major multinational client wins particularly with Unilever obviously has had an effect in terms of those improvements. John Janedis - Wachovia Capital Markets, LLC: There has Michael been a lot of industry talk about big picture activity due to the economy and I’m just wondering, has the bulk of your organic growth been coming from gains in share of [inaudible] and have you been winning an increasing amount of business without a formal pitch process? Michael I. Roth: First of all our net new business win for the year continues to be positive, so that’s good. And I agree there aren’t major pitches out there, which is a double-edged sword. One, that means a lot of our clients are up for review but the opportunities aren’t as great, and there’s no question that we’re seeing an increase from our existing client base and that’s providing a lot of the fuel for our organic growth. John Janedis - Wachovia Capital Markets, LLC: Was any business that you know of shifted from 3Q to 2Q? Michael I. Roth: Not that we would know of.

Our next question comes from Craig Huber - Lehman Brothers. Craig Huber - Lehman Brothers: Going back to the international question, is there anything of one time in nature why the UK performance as well as Latin America and the other international countries were much stronger year-over-year versus the trends we saw in the fourth quarter and first quarter? Was there any one time in nature that really helped the second quarter?

There’s a project with a recurring client that happens every other year in the UK in one of our project businesses, so that’s the only thing that’s worth noting. Michael I. Roth: That’s one of the areas we’re focused on improving, which means we weren’t doing as well as we were in the past. So therefore the improvements are ultimately to be expected with the investment and talent that we’ve added.

In Latin America there was nothing worth noting. Craig Huber - Lehman Brothers: Switching over to Lowe and Media, you mentioned those things are really turning around. Can you give us some numbers in terms of how much your Media revenues were up in the quarter year-over-year and also in terms of how much Lowe was up?

Nice try Craig. We don’t break that out. I did comment though on the fact that one of our key objectives for 2008 was for Lowe to be profitable and we’re on track to do that. So I think that’s a key factor in us achieving our objectives. The same is true with Media. As you recall during the difficult periods of Media, we wanted to make sure that it provided positive input for us in terms of our overall objectives. And both of them are performing quite well. Craig Huber - Lehman Brothers: I’ll take that to mean that organic revenue upped in both of them.

Both of those businesses Craig are tracking ahead of their 08 operating plans. Michael I. Roth: And both of them contribute to our overall results, so you can take it from there. Craig Huber - Lehman Brothers: What of significance is actually underperforming from your original budget going into this year?

I think across the board we’re pleased with where all our businesses are versus our 08 operating plans. Michael I. Roth: We had indicated our objectives are in the 8.5% to 9% range and we’re sticking to that, so therefore you can conclude that we believe we’re right on. Craig Huber - Lehman Brothers: Just going back to the economic question, what do you think it is with your business as to why it’s holding up so darn well? I realize you guys have been in a long-term turnaround here, but if you’ve now posted four of the last five quarters organic revenue growth up 5% to 6.5%, what do you think it is about your business why it’s holding up so much better in this difficult environment versus other places in the media? Michael I. Roth: The one thing that was clear is we had to invest in talent. If you look at the overall improvement we have across all our disciplines, obviously Media - most recently we’ve added two individuals to media, in particular [Matt Syler] and [Michael Udis] to join with [Nick Bryan] and [Richard Bevin] and their team. That’s an important aspect of improving our overall offerings. We continue to invest in all the disciplines. The McCann World Group certainly has added a lot of talent in terms of its disciplines and marketing services. So our whole model, because it’s diversified and the integrated offering is real and we have offerings that deliver on the integrated offering whether it be geographical or by discipline, I think that’s one of the reasons that you see some areas are up and some areas are down. And that’s been helpful to us in terms of achieving our targets. That’s the theory and structure of a holding company model and I think what you’re seeing is that coming to fruition.

Our next question comes from Brian Shipman - Jefferies & Co. Brian Shipman - Jefferies & Co.: Could you talk a little or expand a little on the environment for new biz particularly outside the US and in Asia? And how much do you attribute in the recent strength to the Olympics and is that a risk post-Olympics? Michael I. Roth: I think in new business we don’t see any major big pitches out there and obviously local business is where a lot of the battle is being fought. And we’re getting our fair share. We’re asked to participate in whatever pitches that are out there and we have the offerings in those locations. That’s why we’ve added to our strength in the various locations. The Olympics is not one of the areas that is significant to our planning process. Obviously we are participating in it with some of our major clients but it’s not a significant item for our overall financial picture, so therefore it’s not something that’s going to adversely affect us for 2009.

Our next question comes from Troy Mastin - William Blair & Company, LLC. Troy Mastin - William Blair & Company, LLC: Based on what you’ve seen so far in new business this year, do you expect it to be more or less meaningful in its contribution in the second half of 08 versus the first half? Michael I. Roth: What we can comment on is anecdotally. We’re hearing that people are waiting towards the end of the year to take a look at how this economy will play through. So therefore for 2008 I don’t think it’s going to have a significant impact because obviously if there are new pitches coming for the balance of the year, we won’t see the impact of it until 2009. But again all we can do is see what’s out there right now and we haven’t seen it yet but there are some anecdotal stories out there that people are waiting. And we’ll just have to see what happens. The good news is we are certainly competitive in all our offerings and certainly to the extent there are opportunities out there, we expect to participate.

As Michael had mentioned earlier Troy, the growth through the first half of the year is based upon increased spend with existing clients and new business coming on stream. We would expect that to continue in the back half. Troy Mastin - William Blair & Company, LLC: You expect that to continue in relatively even fashion between the two?

We didn’t disclose the makeup in the first half and so we’re not going to comment on the back half, but again we reiterated our growth targets of 4% to 5% and we’re still confident we’ll achieve that. Michael I. Roth: The sectors that we participate in; certainly the areas that the sectors are having the most trouble are not our largest sectors and frankly, even in those sectors we’re performing well. For example, the financial service side obviously MasterCard is an important component of that for us and I said this on our last call, it comprises of 7% of our total businesses, financial services, and obviously MasterCard is a big part of that. So we’re not seeing as big a hit if you will as a result of the sectors we’re in. Troy Mastin - William Blair & Company, LLC: My next question might be very hard to answer, but I’m going to try anyway. Maybe you’ve thought about this, done some back-of-the-envelope estimates, but how much do you think organic growth would have to deteriorate based on what you put in Slide 8 perhaps in the back half of this year for you to still achieve that 8.5% to 9% organic target? Michael I. Roth: The answer is yes, we’ve done that, but no we’re not going to answer. All I can tell you is that we’ve done that calculation and we wouldn’t be able to say that we’re reasonably comfortable that we’re going to achieve our target if we don’t believe that the organic growth that’s necessary to deliver is within our sight. Troy Mastin - William Blair & Company, LLC: What would be the biggest risk to your ability to hit that target? Is it the project nature of some of your fourth quarter revenue or is it something else? Michael I. Roth: I think it would have to be something greater than just project revenue. And obviously we’re also managing to the margins. I think both Frank and I mentioned in our comments that we’re assuming for the rest of the year for it to be difficult, so therefore our expense management is continuing notwithstanding the solid performance we had for the first half of the year. Troy Mastin - William Blair & Company, LLC: In terms of acquisitions, how are you viewing the current environment in the context of your acquisition strategy? Given the removal of financial players and maybe some valuations coming in, does this make you more motivated to do acquisitions or if there’s more uncertainty in the environment, does that result in a net pullback? Michael I. Roth: We’ve always said that our acquisitions are going to be very strategic in terms of filling either a discipline that we need help in or geographic. And I think that’s just going to continue. There are no major acquisitions out there that we are thinking about or frankly we need. So the two examples that we just completed are classic examples of what we said we were going to be looking for. Geographic in particular in the Middle East, we think that is an opportunity and we used our relationship and our ability to do the transaction to our advantage; and in the digital space. So both of them are totally consistent with the type of transactions that we’ll be looking at going forward.

And Troy, we’re not seeing significant decline in asset valuations. That’s the crux of the question. We’re not seeing that.

Our next question comes from Michael Nathanson - Stanford & Bernstein. Michael Nathanson - Stanford & Bernstein: Now you’ve improved your systems and reporting processes. I know you spent a lot of time on it. How much revenue visibility do you guys have? I mean, how many quarters in advance can you actually get a comfort on forward bookings?

Michael, we’ve gone through our half year operating reviews with all our large units. Our visibility into Q3 and Q4 is good. It’s not where it needs to be and we’re always continuously trying to improve, but again we wouldn’t be here reiterating our growth targets unless we had a high degree of comfort in what the back half of the year looks like. With that said, there’s a fair amount of work that comes up in the fourth quarter that you don’t have visibility into. So we’re basing it on conversations we’re having with clients and what recurring scopes of work or recurring projects have been in the past. But like us, companies are going through the same process now looking at the back half of the year and there’s always risk in that spend. Michael Nathanson - Sanford & Bernstein: And how much would you say, of the revenue base you have now looking forward, what percentage do you think is contractually given? And that could change, too. People could come back and say “I need relief,” but is it more three quarters you think that’s contractually known at this point?

Well, you’ve got contractual scopes of work, you’ve got project-related business, and you still have growth that’s to be generated. So we’re not going to disclose what the percent is in each bucket, but those are the three main buckets and all have risks. Michael I. Roth: And historically our fourth quarter has always been a key quarter for us so that’s something that obviously we have to watch very carefully. The PR business for example is very much project oriented and those are the things we monitor very closely.

Seasonality-wise our fourth quarter’s been running over the past few years 29% to 30% of our annual revenue. Michael Nathanson - Sanford & Bernstein: You mentioned Jack Morton was a factor for Europe a couple times. Was any of that related to the Euro World Cup and is that when you kind of identified UK contracts? Michael I. Roth & Frank Mergenthaler: No, it was not. Michael Nathanson - Sanford & Bernstein: And is Jack Morton your mind considered project based work or should we think of it as more recurring business? Michael I. Roth: It’s more or less project related but we’re looking at the model and trying to get it more as a recurring business. So that’s certainly one of our objectives. They’ve made good strides in their model and becoming more recurring, but certainly a good piece of it is still project based.

Our next question comes from Matt Chesler - Deutsche Bank Securities. Matt Chesler - Deutsche Bank Securities: All of my questions have been answered, thank you.

Our next question comes from Benjamin Schachter - UBS. Benjamin Schachter - UBS: Going into the quarter, I was wondering if you could talk about what your expectations were for the US. It seems slightly on a trajectory downward and I was wondering how low you think the US can go. And then separately, the UK seems very strong and anecdotally we’re hearing the opposite in terms of a lot of things that are going on in the macro situation in the UKs. So I’m wondering how you explain how the UK has done so much better versus the continental? Michael I. Roth: Well one of the things I had commented about the UK was the wins that Lowe had in the UK in particular with Unilever, so that is a good piece of the growth in the UK. The US is obviously a very important market for us and we watch it very carefully. A lot of the stories in terms of potential pullbacks we’re hearing in the US, again we haven’t seen major pullbacks although clearly our clients are looking much more carefully at their spend in terms of where they can get the most bang for their buck, can they get more for less, and all of that is going on in the United States. But it’s still all factored into our assumptions and our conclusion that we’re on track to achieve our overall targets. Benjamin Schachter - UBS: But for the US your targets include organic lower than 3%? Michael I. Roth: It’s all wrapped up in the conclusion in terms of achieving our overall target. And when we say our overall organic is 4% to 5% that includes our expectations for the United States. Benjamin Schachter - UBS: I’m wondering if you have any comments on initial budgeting thoughts you have around 09 and what kind of organic growth rates you think you might be starting to think about there? Michael I. Roth: We just went through and we’re in the midst of our RE for the full year and obviously at the end of it we say, “All right, let’s take a picture of 09,” and usually the response is, “Let’s get through 08 before we start talking in detail about 09.” So I’ll use the same answer my operating guys give me.

That’s tough to do until you get better visibility in the fourth quarter and that doesn’t happen until we start really going through the planning process in September/October. Benjamin Schachter - UBS: By September/October you think you’ll have a sense of it?

Oh yes. We’ll be deep into planning by then, so I think everyone’s in a wait and see get through August, people get back to September and get better visibility in the fourth quarter, then we’ll have a view on 09. Michael I. Roth: And a lot of it is going to be a function of where the economy is in the fourth quarter. And it’s reasonable to wait to see that.

Our next question comes from Dan Salmon - BMO Capital Markets. Dan Salmon - BMO Capital Markets: On headcount, prior to this I think you basically had been talking that you had basically been maintaining headcount for the most part and shifting it into more higher growth areas and out of the slower growth areas. Does that remain the case or have you picked up at all in light of the strong performance or staying cautious on the second half? Michael I. Roth: The bulk of the increase in the headcount comes from our acquisition of Lowe Linthas in India, so therefore generally our headcount is relatively stable if you would and we’re seeing ins and outs. And again it’s consistent with what you said and that is we’re heading into our headcount in those markets and disciplines that are our growth areas. So we’re using a relatively level headcount. Dan Salmon - BMO Capital Markets: Regarding the investment in MCN, the timing of it. Was there anything in particular that triggered that? Maybe something in your ownership agreement or was it just simply that the time was right? Michael I. Roth: No, we’ve had a long-lasting relationship with them. They’re business is doing great. It’s a market when we do our strategic planning that’s certainly an area we want to grow in, so we felt it best to have discussions about it. And they were very receptive to it and it was mutually agreed upon obviously and we were both pretty excited about it. Dan Salmon - BMO Capital Markets: One for Frank here. With the new credit facility rolled out here at only $335 million of potential liquidity, is there anything that’s not a huge amount with the elf obviously still sitting there, should we expect anything else before the elf matures or is this sort of in preparation for that and more moves to come next year?

The $750 million of liquidity the ELF provides we’re confident we don’t need that much liquidity. So if there’s an opportunity to go into the credit market to expand the $335 million facility, we’ll look at it. But we’re comfortable where we are today and we’ll be opportunistic but we feel very pleased we got this transaction done in a very difficult bank market and we’re very pleased that our bank groups stepped up and executed the deal.

Our next question comes from [Jonathan Cohen]. [Jonathan Cohen]: Where do you see your leverage ratio ending up at year end? And the second question is, Moody’s put out a very positive note with regard to IPG’s credit just a few days ago. When are you guys going back into S&P? It seem like they’re quite [inaudible] here?

On a leverage ratio Jonathan I don’t have a projected number in front of me, so we can circle back with you with Jerry. On S&P we meet with all of the agencies regularly. We’re very transparent with them. I think we have a good relationship with them. We would love to see our rating improve at a more accelerated rate given the turnaround and what we’ve done from a financial perspective over the last eight to 10 quarters, and we’ll continue to meet with them. But we can’t control their own internal processes. Michael I. Roth: The rating agencies right now are a little gun shy and they’re a lot quicker to take down than bring up. So it’s a little frustrating when you put in the kind of results and our balance sheet the improvements that we’ve seen, but we’ll keep working at it but they’re more interested on the downside than the upside these days. [Jonathan Cohen]: Any plans to physically go into S&P before the year end?

Well, we talk to them every quarter. They come here; we go there; we do it via phone; we’ll meet with them whenever they’d like. Michael I. Roth: Before we even do a debt deal you have to talk to the rating agencies and get their views.

We give them briefings on quarters before we go public so again I think we’re doing everything we can to show them transparency and we’re anxiously waiting for them to move our rating up.

Our next question comes from Ian Whitaker.

Most of mine have been answered, but one remaining question actually. As you alluded to, we’ve seen some companies actually report some very good growth in terms of advertising in the market but I guess one of the cynical points is always thrown back is with [inaudible] actually going into price promotion and also as well into in-store activity. I just wondered what your view is? When you talk to the advertisers, has there been a shift in terms of more of an emphasis on brand building and therefore spending on traditional advertising or do you feel that when they actually increase their market budget most of the increase is actually going to these in-store promotions? Michael I. Roth: I think we said at the beginning we’ve seen an increase in activation, we’ve seen an increase in our marketing services, and that I think is going to continue to trend upwards. We’re pleased with some of the brand building opportunities we have as well. So again I think the larger multinational companies look at this as an opportunity and they also realize that this is not the time to pull back in terms of brand building. Because when there’s no, I’ll say this as an advertising guy, you spend more and you get a return on your investment in terms of your spend. So our challenge is to make sure that we’re moving the needle and we have the tools and ability to move it and prove that we are. As long as we continue to do that I think you’re going to continue to see the spend.

Just to clarify, what I meant in terms of the spend was things for example such as 3 for 2 price promotions. The cynical view is in terms of where the advertisers are shifting their spend to, it’s more to that line when they increase the marketing budgets, but I’m just wondering whether or not you’re seeing that in your conversations with the advertisers? Michael I. Roth: I think it’s all over the lot so I can’t comment particularly with any particular promotion that’s out there.

But activation is definitely up right now.

Our next question comes from Andrew Berg - Post Advisory Group. Andrew Berg - Post Advisory Group: Going back to the comments on working capital, obviously working capital was a great benefit this quarter. You guys cautioned us not to look too much into one quarter’s results, but as we think about it this quarter as we roll into the next quarter’s period, how should we think about what may play out in terms of shifts from second or third quarter and how big a potential use working capital might be in the third quarter given how big a benefit it was in the second?

Andrew, it’s tough to comment on that. What we’ve said is that we will be cash flow positive from an operating perspective this year for the first time in a while. We continue to believe in that. There’s a lot of volatility in our model in working capital. We’ve made it a focus for the past 18 months. Our operators are now aggressively managing their balance sheets, both payables and receivables, so we expect to see continued improvement of working capital management for 08 versus 07. Andrew Berg - Post Advisory Group: And as we think about where you are today in terms of your receivables DSO or your payables, you guys in this quarter did a fantastic job. Historically we’ve seen it back up a little bit in the second quarter. I presume we should be working off of today’s levels for any sort of traditional softness we see Q2 to Q3 and we shouldn’t think that you’d revert back to third quarter levels of last year then?

Again, difficult for me to comment on because we don’t spend too much time focusing where our quarter end working capital is. We’re more focused on improving our processes to ensure we can squeeze as much cash out of working capital in our balance sheet as possible. Where we are seeing a real positive effect is on the tax side. We’ve been able to utilize about $200 million in 07 of our net operating losses, which was cash flow positive of roughly generated about $60 million in cash. If we continue to deliver what we’ve indicated with respect to this year, we’d expect that number to close to double. So we’re starting to get at some of these tax assets that are on our balance sheet and fully provided for and it’s translating into real cash generation on the tax front.

Our next question comes from Catriona Fallon - Citigroup. Catriona Fallon - Citigroup: Actually you were touching on my question which was around the NOLs. So you used about $200 million last year. Does that mean you still have about $1.5 billion left NOLs?

No, we actually have $1.8 billion left. Catriona Fallon - Citigroup: And $1.5 billion overseas?

No. We don’t just break that out Catriona, but the majority is overseas but it’s not that heavily weighted. Catriona Fallon - Citigroup: And you expect to use about $400 million of that this year?

No, I think if we deliver our plan, it’s more like $300 million and with it would be a tax effect added, it’s roughly $100 million of cash coverage. Michael I. Roth: We can’t take benefit obviously until we use it. And that’s obviously a key component of our planning. Catriona Fallon - Citigroup: Has anything changed with the billing methodology or pricing that you’ve been able to get out of clients? Is there anything that you’re doing different in your processes that maybe are making you able to charge for more of the services that you’re performing for clients? I guess I’m asking about efficiency and whether you’re able to get paid for all the work that you’re doing? Michael I. Roth: I think we’ve touched on this before. As we developed our financial controls and our transparency with our clients and look closely at our contracts, we’ve had the ability to better analyze the contracts and get paid for the work that we’re doing. So I think yes, the answer to that is we are in a stronger position in terms of dealing with our clients and the work that’s being performed. And in the old days it was more difficult for us to do that so I think the improvements we’ve made in financial controls as well as the analyses of our profitability by our clients has enabled us to improve on that issue.

And we’ve made some fairly substantial investments behind systems and process improvements and we’re sharing best practices and processes amongst our networks, so this was an area that we called out a number of years ago as one of the largest opportunities for us to improve margins. It was the amount of leakage that our lack of visibility into our client relationships was causing. And we’re not there yet, but we continue to improve on it quarter to quarter. Catriona Fallon - Citigroup: I know there’ve been questions about seasonality, but do you see anything different about the seasonality this year? I mean, typically Q3 comes down from a revenue perspective sequentially and I’m wondering if there’s anything different this year with what you’re seeing with the current trend from Q2, the Olympics going into Q3, and then what you might expect for Q4? Michael I. Roth: We’d expect seasonality trends to be consistent.

Our last question comes from Leo Schmidt - The CHUBB Corporation. Leo Schmidt - The CHUBB Corporation: The first question has to do with looking at the last time we had a major economic slowdown and looking at today’s environment, I guess that would be 2001 and going into the summer of 2001. As you look back over those periods, can you draw any compare and contrast what’s different then and what’s different now? I know it’s a much different business for you; you have a lot more control. That was an advertising bubble blowing up; this is not. This has consumer housing kind of slowing down so the consumer’s in a much different place. But as you look out and as you kind of look and hear your clients talk to you, what is different that you think is happening now than then? And then my second question is, could you talk about your payables in your cash flow? Is that from your incentive comp going up or could you give us a little more flavor of the payable versus receivable there? Michael I. Roth: I’ll let Frank talk about the payables. As far as the difference in the economic slowdown, clearly the dot com environment was a lot different than it is today. When that bubble burst, we had a lot of our clients just spending money as a result of the influx from the dot com boom. We don’t have that today so that is probably the most significant difference from it. The other is the more global aspect of our business as well as the integrated offering in the different marketing services and offerings that we have as a company. I think the company today is very well diversified in terms of our offerings and I think that’s what I was alluding to before when I was talking about the model. And that is, with the various different services we have to help our clients get the message out there and the various tools and research we have, I think it lends itself to the confidence that the clients have and the ability to spend and get a return for it. So I think that’s a difference. A downturn is a downturn and it’s not pretty when it really happens, but I think we’re better suited to deal with it than we were back then and we also have the financial transparency into our businesses that is a lot different now than we did before.

On the working capital front, 1/1/07 we began to incent our agency financial teams to more aggressively manage their balance sheets. So with respect to AR collection and managing DSOs, we’re seeing a noticeable improvement. And on the payable side, one of the things that we ensure right now is the processes have improved that we’re never out any money. So our match pay processes have been dramatically improved and again I think you’re seeing that now is coming through in the improvement in our working capital management. Michael I. Roth: I want to thank you all for your support and participation and look forward to our next call. Thank you.