Randall J. Weisenburger - Executive Vice President and Chief Financial Officer John D. Wren - President and Chief Executive Officer

Jason Helfstein - Oppenheimer & Co. Alexia Quadrani - JPMorgan Craig Huber - Barclays Capital Benjamin Schachter - UBS Michael Nathanson - Sanford C. Bernstein & Co. Matthew Chesler - Deutsche Bank

Good morning, ladies and gentleman and welcome to the Omnicom's Fourth Quarter 2008 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct the question-and-answer session and instructions will follow at that time. (Operator Instructions). As a reminder, this conference call is being recorded. At this time, I'd now like to introduce you to today's conference call host, Executive Vice President, Chief Financial Officer of Omnicom Group, Mr. Randall Weisenburger. Please go ahead. Randall J. Weisenburger: Thank you. And thank you all for taking the time to listen to our fourth quarter 2008 earnings call. We hope everyone had a chance to review our the earnings release. We've also posted it to our website, both the earnings release and the press... and a investor presentation that will cover the information that we'll present this morning. This call is being simulcast and will be archived on our website. Before we start, I have been asked to remind everyone to read the forward-looking statements and other information that's included on page one of our investor presentation, and to point out that certain of the statements made today may constitute forward-looking statements and that these statements are our present expectations and actual events or results may differ materially. We will begin the call with some brief remarks from John Wren. Then following John's remarks, we'll review the financial performance for the quarter. John D. Wren: Good morning and thank you for joining our call this morning. The fourth quarter was probably the most challenging quarter the company has faced since 1992. The combination of a decline in economic growth worldwide and the rapid strengthening of the U.S. dollar, caused a decrease... a quarterly decrease in our revenue. As all of you know, the pace of the economic decline in the fourth quarter was caused by many factors: the banking system meltdown in November, the freezing of credit to companies and individuals, rising unemployment and the decline in consumer confidence and trust. Looking forward, we think that first nine months of this year is going to be difficult. At this point, we expect to see some improvement late in the year with earlier fourth quarter comparisons and positive gains from the significant stimulus actions by the U.S. and most major countries. Our hope is that these programs will spur recovery in ad spending late in 2009 and then into 2010. As in past recessions, we expect to outperform GDP. Offsetting any decline in spending, and the uncertainty in revenue, we are reducing our cost structure. In the fourth quarter, we eliminated many open positions and implemented targeted staff reductions in many of our agencies. We also cut back non-client, non-essential travel and discretionary costs. We also reduced incentive compensation for senior executives, but preserved incentives for most other employees. And finally we froze our delayed salary increases in order to reduce lay offs. Looking to the longer term, I'm very confident in our ability to adjust to the changing environment. The company continues to be focused on the fundamentals which have seen us through good times and challenging times alike. These fundamentals are: number one, our leading portfolio of global advertising and marketing brands are the best in the world. We continue to have a very well balanced mix of business, diversified by discipline and across geographies and also a broad base of clients in industry served. I don't think there's a question of our unparalleled creativity which is at the core of delivering value to our clients. And finally, we are focused on cash and cost disciplines and... in order to allow us to invest in growth and productivity in the future. Finally, before I turn it back to Randy, I just want to add that our focus during this crisis will be helping our clients grow their businesses. That is our number one priority. Thanks and I'll turn it back to Randy. Randall J. Weisenburger: Thanks John. Although a certainly a difficult quarter, overall we think our agencies accomplished a great deal in the quarter and the financial results were fairly strong, given the economic environment. That said, for the first time in a very long time, due to the combination of the overall economic environment and FX rates, revenue declined in the quarter by $254.7 million to $3.37 billion. That was a decrease of about 7%. Despite the fourth quarter, for the full year, revenue increased $665.9 million to $13.36 billion. That was an increase of 5.2%. Operating income for the quarter decreased 15.7% to $448 million, and that was an operating margin of 13.3% which was down about 140 basis points from the year earlier. To put that in dollar terms, the margin decline translates into roughly $46.1 million of operating income. As everyone knows, the pace of economic change in the fourth quarter was fairly unprecedented. Almost all of our agencies experienced some loss of revenue, mostly in project revenue which was traditionally larger in the fourth quarter and for us, heavily skewed in the United States. Given the time of the year, our only ability to adjust cost was to reduce discretionary spending as much as possible and to reduce our incentive compensation pools which we did. These actions were in fact sufficient to offset the loss of operating income associated with the lost revenue. However, we also took aggressive severance actions in the quarter to align our cost structures with the decline in revenue forecast for 2009. As a result, we had a year-over-year increase in severance of about $55 million in the quarter, which was about $10 million more than the dollar translated decline in operating margins. We estimate that the annualized savings in salary-related cost or the actions taken in the fourth quarter is approximately $215 million. As we move through 2009, we will continue as and if necessary, to aggressively manage our costs to keep them in line with revenue forecast. While we can't control the economy, we do expect to manage our own costs to the extent possible. For the year, operating income increased 1.8% to $1.69 billion and the operating margin was 12.6%, down at about 50 basis points from last year, almost all of which was from the fourth quarter. Net interest expense for the quarter was $23.9 million. That was up about 9.6 million from last year and up about $3.2 million from the third quarter. For the year, net interest expense was a$74.3 million. That was basically flat with 2007. The increase in the quarter versus the fourth quarter of 2007 was primarily the result of the increased interest expense due to supplemental interest payments made in 2008 on our 2031 and 2032 convertible notes, combined with increased average debt levels resulting primarily from our stock repurchase activities in the first half of 2008. Versus the third quarter, the increase was primarily due to a reduction in interest income resulting from a combination of lower interest rates earned on cash balances held primarily in emerging markets and then the FX impact on those earnings. For example, the currencies in some of those markets weakened against the U.S. dollar by as much as 40% and that significantly reduced the U.S. dollar translated interest income. On the tax front, our reported tax rate for the quarter was about 33.5%. That brought the full year rate to 33.6%, which is slightly lower than what we reported last year, due primarily to lower tax rates in various foreign jurisdictions. Net income for the reason I mentioned earlier, net income for the quarter decreased 13.7% to $271 million, a broad net income year-to-date or for the full year up to just over $1 billion, which was an increase of 2.5%. Fully diluted earnings per share decreased 8.3% to $0.88 per share in the quarter, and for the 12 months increased 7.5% to $3.17 per share. Now, analyzing our revenue performance, as everyone is aware the U.S. dollar has strengthened significantly versus most currencies in the quarter, causing a significant FX impact. In the quarter that impact was $210.7 million of decline in revenue. For the year, even after the major move in the quarter, FX remained marginally positive at 1.3% or $164 million. Looking ahead, if rates stay where they are, we expect FX will be negative between 8 and 9% in Q1 and then between 6.5 and 7.5% for the full year. Growth from acquisitions net of dispositions added about $39 million to revenue in the quarter or about 1%. Our acquisition activity has been fairly minimal over the past six months. It's been our first priority to focus on our existing businesses, making sure our own house is in order before buying a new one. And while we've seen a number of potentially interesting businesses, for the most part, it would appear that many sellers' expectations have not yet fully adjusted to the current economic environment, but that does appear to be changing. Organic growth, for the first time in a very long time, declined by $83.2 million or about 2.3%. However, qualitatively, we think our agencies are in a very good shape. Our agencies again were the most highly recognized and awarded agencies in each of the respective fields for last year and our overall, new business record was excellent. So while we can't expect our agencies to control the global economy, we do expect them to continue to outperform the economy overall and more importantly, to outperform their peers. For the year, organic growth was positive 2.9%, adding about $374 million to revenue. As for our mix of business, traditional media advertising accounted for 43.3%, CRM was 38.5%, PR 9% and specialty communications 9.2%. As for their respective growth rates, advertising declined 7.6% in the quarter but excluding currency impacts, was down only 1.4%. CRM, while negative overall, continued to be the strongest performing sector, with a 3.3% overall decline and again excluding the impact of currency changes increased 3%. Public Relations was down 10.2%, continuing to experience general softness in the quarter, and specialty communications was down 15.3%. If people recall from prior calls, this category consists primarily of specialty media, recruitment, advertising and our healthcare businesses, all three difficult sectors in the quarter. Specialty media is primarily our Directory or Yellow Pages business, which in addition to being impacted by general economic conditions, is facing some significant technology changes. Recruitment advertising, which is probably our most economically-sensitive business, was down almost 30% from last year and healthcare continue to slow in the quarter due to a lower number of new product releases and cuts in spending from the large pharma companies. Our geographic mix of business in the quarter was 52.2% U.S. and 47.8% international. In the United States, revenue declined $86.4 million or 4.7%. Acquisitions, actually added $20 million to revenue or about 1.1% and organic growth was a negative 5.8%. International revenue decreased by $168.3 million or 9.5%. As I mentioned before, FX was very significant. It reduced revenue by $210.7 million or about 11.8%. International acquisitions added $19 million or 1.1%. And our international organic growth in the quarter was positive 1.3%. Internationally, we had strong performances in the emerging the markets of Asia, especially China and India, as well as in Eastern Europe. Developed Asia, specifically Japan and Korea were down sharply and Western Europe, with the exception of France and the U.K., were consistent with U.S. The results in France and the U.K. were more a factor of new business success and weaker prior year comparatives rather than better economic conditions in those markets. Operating cash flow for the year was strong. While as a result of the current economic environment, we're experiencing pressure from certain clients on working capital. To-date, our performance has been good. The measure of our operating performance in this area is the average relationship between our receivables and payables. To-date, we've not experienced any meaningful decline in our working capital operating performance. We have however, significantly increased our focus in this area to ensure that our performance stays on track. Absent our own operating performance, FX has had a negative impact on our working capital. As did although to a much lesser extent, declines in client spending at year end. As you know, we operate with negative working capital, meaning working capital is a source of cash for us, about half of which comes from our media operations. With the significant FX moves in the quarter, we experienced a dollar translated contraction in working capital of about $350 million. In addition, we experienced some contraction in working capital as a result of reductions in client media spending near year end. Our primary sources of cash, net income adjusted for basic non-cash charges, primarily stock-based compensation charges and their related tax benefits, then depreciation and amortization. Those items totaled $1.3 billion. Our primary uses of cash for the year were dividends, which totaled $192 million. CapEx totaled $212 million. Acquisitions, including earn out payments, totaled $441 million and then share repurchases for the year totaled 847 million. We did suspend repurchase initiative back in August and don't intend to resume until after the capital markets have fully stabilized. We also received 86 million of proceeds from auction exercises and stock sold under our employee stock purchase plan. That resulted in net repurchases of about 760.8 million. As a result of our repurchase activity over the last 12 months, our average diluted share count for the fourth quarter declined 6.1% to about 307.2 million shares. Our current credit picture; we finished the quarter and a very strong capital market position. Our operating leverage ratios, EBITDA to gross interest and total debt to EBITDA were very strong at 15.4 and 1.6 times, respectively. As a reminder, our debt facilities contain only those two covenants, EBITDA to net interest of not less than five times and net debt to EBITDA of not greater than three times. From a liquidity perspective, we finished the year in a strong position with cash in undrawn committed credit facilities totaling just over $3.6 billion. And we had an additional uncommitted facilities available totaling $354 million. As many of you know, the put date on our 2031 convertible bonds was the end of last week. And as expected, we receive puts on 841 million of the 847 million outstanding bonds. To fund the put, we drew down from our revolver and of the 841 million bonds put, we retired 295 million and then a partnership controlled by Omnicom was formed to purchase the remaining 546 million of notes, with the intent in the event that the capital markets and specifically, the convertible bond markets recover over the next year, the partnership will look to sell those bonds back into the market. And finally on a new business front, while new business activity in the quarter was fairly light, our agencies fared pretty well overall with net wins totaling approximately $780 million, with the most significant win being OMD's win or the combined global media account for Nissan and Renault. They already have the Nissan account, so this was both an important sale and an important win. Now with that, I am going to ask the operator to open the call for questions.

Great. Thank you very much. (Operator Instructions). And we do have a question from line of Jason Helfstein with Oppenheimer. Please go ahead. Jason Helfstein - Oppenheimer & Co.: Hi thanks. Could you hear me?

Yes. Jason Helfstein - Oppenheimer & Co.: Okay. Two questions; so, what was... can you just tell us what project revenues were last year in the first quarter of '08? And then, just if you can just talk about near-term business trends, has weakness hit non-projects spending yet? And then secondly, do you expect to benefit of the new business wins in the U.K. and France to help drive those countries in the next six to nine months? And then when you combined them with growth in emerging markets, do you think organic growth can continue to outpace the U.S. and remain positive or is there just a lag and eventually, it catches up with the U.S? And then just lastly housekeeping, what was the impact of currency on EPS? Thanks.

We can't really cut those up into a few more things but first, projects in the first quarter. I don't believe, we have the number. There are projects in every quarter. As Randy indicated, the fourth quarter always seems to be more significant and that's we tend to track that more closely. I think that was your first question. I think across the board, clients are evaluating and looking at their marketing spend. Until the banking crisis is resolved and liquidity starts to flow back into the system, I think we are in a unusual... we continue to be in an unusual period of time. And clients spending patterns haven't fully settled down yet. I think what you could expect is, what's normal. Automotives are being very, very cautious in cutting back because of the decline in volume and credit availability to consumers on a global basis. Packaged good companies are spending. We don't see increases in their spending, but see them more efficient and trying to gain market share during this period. So things haven't yet settled, but the normal patterns I think will prevail as we get further out in to the year.

Okay. Couple of other questions, that I remembered and then you'll have to fill in where we missed. FX impact on EPS. FX pretty much just flows straight through on a percentage basis, through pretty much all the lines of the P&L. I don't think it's any significant... its not significantly more or less impactful anywhere. Your other question was France and the U.K.'s performance in the quarter. Is it going to carry over? Our operations in those markets from a business standpoint are performing well, but from the economies they are, I don't think are in a better shape than anywhere else in the world. So they are certainly going to get impacted by the economies as well. Jason Helfstein - Oppenheimer & Co.: Okay. And then just the last piece was when then you combine that with the emerging markets. Obviously, emerging markets helped the international organic. I mean do you expect that to continue?

Yes. Yeah absolutely. I mean what we expect over a longer period of time is that we should be able to outperform whatever global GDP happens to be. That's been our history, that's been what our abilities been in the past. Difficult to be granular and tell you what January is going to be or the first quarter. But, that's something that the company has been able to do throughout its entire history. The other side of the equation is adjusting our costs, while there is uncertainty, while there is a less than stable environment, which is where we're at. In terms of emerging markets, you have to remember that China where it's very important and contributes a lot, is only six-tenths... 6% of the global economy. So if it grows in excess of where its projecting to be, if it grew 10%, it would be adding six-tenths of a percent to the global population, I mean to the global growth. So, everything is important. All those markets are important, they'll continue to be important. But in a very near term, I think the developed nations are where most of the actions are going to occur.

Couple of the emerging markets that have been very strong over the last couple of years, Brazil and Russia in particular, those economies have been, especially Russia's been hit fairly hard with the change in oil prices. We'll see how that ultimately flows through. We have very good operations in both of those countries. So I suspect we will do well on a relative basis. But again those economies may be harder hit even than the United States. Jason Helfstein - Oppenheimer & Co.: Thank you very much.

Thank you.

Thanks. And our next question comes from the line of Alexia Quadrani with JPMorgan. Please go ahead. Alexia Quadrani - JPMorgan: Hi, thank you. Just a couple of questions, I guess first on the fourth quarter; could you give us some color I guess how organic growth performed in the fourth quarter? Specifically, how much of the pull back came from the project base that is your loss to project based business versus sort of a general pull back in client spending or specifically, maybe the auto category. And then secondly, did the European I guess ad trends, did they worsen as the quarter progressed?

The Auto sector was clearly impacted in the fourth quarter. With as many operations as we have around the world, there wasn't a wholesale reduction in any one place that we could point to. But there were plants where they could eliminated or have curtailed plants in the fourth quarter and cut back on some spending.

Project revenue was pretty significant. Each year in the quarter, we've kind of an incremental couple of hundred million dollars of revenue that we've explained in the past is always difficult to forecast, because it's kind of that last minute project revenue. A substantial portion of that doesn't appeared that it came in. That $200 million is accounts for over -- would be 4% organic growth in itself. We were in negative what 2.3% organic growth in total. Alexia Quadrani - JPMorgan: Okay, and then I just a follow up question; in terms of the first quarter, should we... do you have any sense of like how much severance expense we made back in Q1, just given your current plans?

We were able to do quite a bit of trimming based for what we saw in the fourth quarter. The $55 million was the year-over-year increase. The actual severance number was greater than that in the fourth quarter. We will have some severance costs. It will be very targeted in the quarter and it depends upon clients finalizing their spending which in many instances we're waiting for, we'll know about in the next couple of weeks. So we don't expect anything to the level what we have experienced in the fourth quarter, but we don't have a targeted number at the moment. At this point, such as surgical going forward is unlike what happens in the business. Alexia Quadrani - JPMorgan: And just another housekeeping point; tax rate for the year should we see this as Q4 is a good run rate for '09?

No I'd probably assume 33.7 to 33.9. That's safer. Alexia Quadrani - JPMorgan: Okay. Thank you very much.

Thank you.

Thanks. And our next question comes from comes the line of Craig Huber with Barclays. Please go ahead. Craig Huber - Barclays Capital: Yes, good morning. Just wanted to talk a bit about your cash level. Can you explain a little further Randy why was about $1.1 billion here in the fourth quarter, down from $1.7 billion, $1.8 billion each of last two fourth quarters? And then more importantly how much of that $1 billion, $1.1 billion of cash you due use your own, your own money can you do you want with it?

Okay. Two questions, let me give the first one. Two pieces to that year-over-year cash; on a spending basis when you go through our, what I'll describe is our primary sources and uses of cash, excluding working capital. We spent about $300 million more than our cash sources. So, that should have increased our net debt levels or decreased our cash balance by that $300 million. The rest of it is really a conversion, FX conversion difference. Basically, we're converting all of our international balances back into U.S. dollars and those conversions basically shrunk the U.S. reported dollar amount by about $350 million. That's basically the bulk of those changes. As far as our cash, I mean as a technical matter, it's our cash. Now, we use that cash to operate the business. We have large daily swings in working capital balances, depending upon the timing of client flows, or over the course of say 2008, our daily average cash balance was roughly say $100 million, it wasn't $1 billion. On high cash days, cash flow coming into the treasury system, it could have been as high as $1.5 billion and on low cash days, we mean we would have all cash payments out, maybe as much as 5 or $600 million drawn under our facilities. So, help me, as I am trying to answer the question fully, the cash is ours but we use it in the business. We couldn't take that cash and go out making acquisition with it and not replenish it somehow.

And you didn't ask this, but I think if you look at 2008 and then you start to think about 2009. In 2008, we bought back about $800 million net of our own stock program which we suspended in August as Randy indicated. We won't start up again until the world returns to a more normal world. And I think the acquisition number of $400 million plus last year was higher than what our requirements are going to be in 2009 at this point, unless we do anything new. So as you go forward, you have the operations and then those uses and some of those uses are curtailed pretty seriously at the moment. Craig Huber - Barclays Capital: And also a housekeeping question. Should 2031 converts to $295 million that you guys retired; is there a cash tax safety you have to take on that in the coming quarters?

Well, we'll see. There is some interesting legislation proposed in the Senate Bill that would significantly push out that potential tax payment. We'll see if that comes through. If it doesn't come through, that will be about, I think it's going to be about $50 million to $60 million. Craig Huber - Barclays Capital: Okay. Then lastly, just a follow-up on Alexia's question; can you give us if you would, how much the project-related revenues were in the fourth quarter versus what they were a year ago? And I think you were saying that's what the major swing was here in the U.S., is that correct?

Yeah. We don't... see I've to do this, we don't track specifically all of our project revenue versus all of our non-project revenue. What we do know is that in the fourth quarter of each year there is a couple of hundred million dollars of a project revenue that comes in that is un-forecasted revenue, each year when the quarter starts. That revenue tends to be last minute projects; clients that have anything left in their budget, projects will come out of the agencies or out of the clients, finishing off the year. Those projects tend to come up because people have budget left to spend. This year we didn't expect, given the overall economic climate that there would certainly be as many projects or as much of that spending as normal. As we suspected, that didn't come in or at least a large percentage of that didn't come in. Craig Huber - Barclays Capital: Okay. Then lastly can you quantify how much money you saved from lower incentive costs in the quarter, versus a year ago?

Yes. But it's going to take me a second.

If there is another question, while we get this and we'll come back to this one if you would. Craig Huber - Barclays Capital: No that's all I had. Thank you.

When we get it Craig, we'll just say it. Actually and this is a rough...our incentive system is based upon individual performance and targets throughout the group. So if a particular unit doesn't perform, incentives automatically are declining. So we will get back to you in a minute, since we don't have the number.

Great, thank you. Then we're going to go on to a question from the line of Ben Schachter with UBS. Benjamin Schachter - UBS: Hey guys, a few questions. Randy you've talked about the partnership buying they convert. Wondering if you can explain a bit more about how that structure works, why it's in place?. And then also, if you could talk about how we should think about the overall net interest line for the year going forward? And then a few follow ups after that, thanks.

Okay. Let's see, we'll start with the net interest line. I think a good starting point will be our fourth quarter interest expense. I think it will go...our interest expense should go up from that number, probably in the 3 to $5 million per quarter range, depending upon again what happens with short-term interest rates and what happens with the July 32 bond. Now a bigger piece of our... let's say capital structure is going to be 30 days floating rate versus having the rate fixed. Last year on the 2031 bond, I think we've paid just under 1% interest rate to keep it outstanding. So, frankly what we've refinanced that with by drawing down under revolver at least based on current rates, is about in the same spot. On a year-over-year difference, because of FX differences and lower interest rates on invested cash, we will have or we expect to have less interest income in 2009 than we did in 2008 and then, also the translation of that back into dollars will be less. So, from there I think the fourth quarter is probably a pretty good view. We do cycle for the first half of 2009 with higher interest expense on the 2032 bond, the first half of 2008 that number was lower than will be in the first half of 2009. As far as the partnership goes, we formed a partnership to hold the bonds and that partnership will look to resell the bonds back into the marketplace. We think the converts are very good security for Omnicom. They fit well into Omnicom's capital structure and tax planning. We'd like to keep the bonds outstanding on a long-term basis. Right now, I think current market conditions the convert bond market is not acting at least normally. Our hope is that the convert bond market stabilizes or recovers or how we want to phrase it, over the course of the next year. And that we're able to reissue those bonds back into the marketplace. We'll see if that's possible. Benjamin Schachter - UBS: Okay. In the past when we've spoken before this macro meltdown, we talked about having 80, 90% visibility in the revenue for the year by November or December. And I assume obviously that's not happening now that it seems extent. So could you talk about visibility into '09 in terms of, you obviously have your severance cost. You're laying off for certain expectations. What's going on with that visibility, what kind of flexibility are in contracts now to change the way you're able to see the year. Just overall, how you're looking at the revenue picture and how do you think about that?

Well I think even at this point we still have probably 75, 80% maybe even 85% visibility, into 2009. The challenge is, obviously even 15% not, visible given the accuracy that we'd like to have with our forecast and planning is a pretty big sway. I used to somewhat joke that investors thought plus or minus 1% organic growth, might have been significant enough, even if we knew 90% of our business. If people tell 1% was significant that was ten times. Right now, we certainly have less visibility than we've had in prior years at this point.

In terms of severance and the actions we've taken in the fourth quarter, that was very targeted and we went unit-by-unit around the world, looked at what the revenue expectations were done at that office level and then made determinations as to what severance... what reductions we could incur without impairing our ability to continue to service our clients. So that was a very targeted exercise which started early in the fourth quarter and was acted upon when we realized that project revenue wasn't coming through. We will continue to assess our business at that level as we go forward. But if there is a bit of fog out there and I think until the... until some of the broader economic things settle, we're going to continue to feel our way through on part of our revenue base. Benjamin Schachter - UBS: And then also John you started off the call mentioning things haven't been discussed since the early 90s. If my model is correct, looking back then, the operating margins were 11%... 11 to 12%. Is there any reason to think that it should be similar to that looking into 2009 or is that just ancient history and the business is different today?

Right, that's ancient history. Our mix of business today is far different than what it was back in '92. I think what I was referring to is '92 is the last hard serious recession that the company faced. The one in earlier in this decade happened very quickly and seems to pass very quickly. '92 was a little longer slog and that's what I was referring too. Benjamin Schachter - UBS: So, you don't see any scenarios where your operating margin can get below 12?

We were about 12.6% margins for '08. I said a couple of times, certainly our objectives is to try to manage and hold those margins. Depending upon the overall economic environment, thinking flat to say minus 50 to 100 basis points of margin, I think would be pretty strong performance, again depending upon that overall economic back drop.

We do continue to have quite a bit of flexibility in our cost base. Benjamin Schachter - UBS: Alright. Thanks gook luck.

Thank you. Operator: Thank you and our next question comes from the line of Michael Nathanson with Stanford Bernstein. Please go ahead. Michael Nathanson - Sanford C. Bernstein & Co.: Thanks. Only follow up the last question and one for Randy. John, could you give us a sense of what the flexibility is? How much of your salary and services, say cost are flexible in nature?

Well, the two things happen with it. First of all, as I described it as product level, so, the people that are actively engaged in clients. There is somewhat of a drag cost but the client is looking for people to execute on work. If the work isn't there, those costs are... is painful as it is somewhat flexible. With operational people and senior management, the incentive comp rules are highly flexible. If business is down those numbers can be adjusted. For senior people the incentive compensation can be a much greater percentage change in their compensation than the change in revenues. 4 or 5% decline in revenue could mean 40 or 50% cut in pay for some of those senior people that really... their overall positions aren't necessarily flexible, but their pay certainly is. Michael Nathanson - Sanford C. Bernstein & Co.: Randy, my point is incentive comp versus how much percentage of revenue? Is it in the 5 to 10% range?

I think its in the 5 or 6% range.

Yeah. Michael Nathanson - Sanford C. Bernstein & Co.: Okay that's what... okay great. And then on the convertible partnership, does that structure mean that you could still enjoy the tax and accounting benefits on the compared account (ph) accusing the 5%?

Well there are no accounting benefits of those bonds. The full tax savings of those bonds, none of that is a P&L benefit for us. From a tax standpoint, they will be very minimal current year or while they're in this partnership, current tax benefits. It does preserve the ability to issue those bonds back into the marketplace than preserve the long-term benefits and to keep the specific bonds alive. Michael Nathanson - Sanford C. Bernstein & Co.: Can you hear me. What happens, you've said that if conditions improve, let's once the marketing conditions were to improve, is there anything magical about 12 months and who decides the course of actions at that point?

No I don't think there is any magical about the 12 months. If these bonds are something that the market finds acceptable, then their security is that that we'd like to preserve. I think the structure is designed somewhat as a bridge knowing that the current market environment is disrupted. What the new reality is, I don't know. But we're this is a bridge to finding out what the new realty is and the new marketplace thinks these securities are good security. We would like to have an outstanding. If they don't think it's a good security, then we'll probably dissolve the partnership and retire whatever bonds are still outstanding. Michael Nathanson - Sanford C. Bernstein & Co.: Thanks.

Thank you. And our next question comes from the line of Matt Chesler with Deutsche Bank. Please go ahead. Matthew Chesler - Deutsche Bank: Hi, good morning, a few questions. You mentioned that the severance, the year-to-year increase was $55 million and the run rate savings will be substantially larger than that. What was the actual amount that you were able to record in the quarter and were there any additional charges, whether its office-related or otherwise that might be considered non-recurring in nature?

I think the total severance number was about $75 million in the quarter. One-time in major charges, I mean there is... the only thing that seems to always recur is charges that are non-recurring. So we don't tend to call things non-recurring charge and a company of this size depending upon the agency there is inevitably a handful of things that are only happened to that agency once. They just happen to another agency in a different quarter.

And in terms of the other cost, is complex because of its size but there is a specific strategy and analysis done city by city of our real estate throughout the world. And in every just virtually every place in the world which is coming on an annual basis. So as we have to flex our staff down, we do over a period of time have the ability to adjust other costs when we have reductions. Similarly, as we increase, we can flex our costs. So...

And in an economic environment like this, there is certainly cost and things that they come about that are not normal. I mean there is definitely increase in bad debts.

There is write off...

Much, much greater increase in our spend focusing on client credit and working capital and renegotiating contracts, et cetera. So economic times like this certainly have an increase in certain cost that come with it. Matthew Chesler - Deutsche Bank: So would it be overdoing it to assume that the combined total of those costs exceeded the $100 million in total or is it somewhat less than that?

No, Matt, my guess is it certainly exceeded $100 million. Matthew Chesler - Deutsche Bank: Okay. Another question would be, while the world changed dramatically in the early fall, at what point did it become clear that this wasn't your run in the mill at market slowdown? What point in the quarter was that that you really got a sense that you needed to take some plausible action?

What happens in most quarters, has happened this year a little bit differently is year-end projects; you never get real clear visibility as to just how much is going to come through. You are basing a lot of your assumptions through the quarter on history. I think this year when the banking system froze in November, it shifted almost everybody's attention to their balance sheets and behavior followed. And so many projects, which could have happened and would have happened on a more normal basis just didn't materialize, as you went through the quarter. The other thing which is difficult to explain is we probably have over 2000 operating offices and facilities around the world. They don't have to have much of a decline in revenue per location to add up to $83 million or $100 million. So the micro-management of this gets a bit difficult and it gets reflected or highlighted in the quarter. But when you look at spending over the course of a year or patterns, it's not necessarily a very clear indication that develop, that causes a trend which we can project. Matthew Chesler - Deutsche Bank: Okay, from your perspective, did you feel that as we exited December, that spending patterns were slower than they were, in November when the freeze first started to happen or was there any trend you could sort of give us sense anecdotally there?

Well, I think there is a sense of caution on the part of most companies. At the moment, we're still sorting that out.

The advantage of having an incredibly diversified group of very smart clients is you get it, there is a diverse reaction. I hear stories, anecdotal stories of clients using this as opportunities to be aggressive in building their brands and try to gain market share. You hear other stories of clients trying to freeze everything they can freeze. They're obviously face... each clients facing different realities in their own business, own balance sheet, own distribution channels et cetera. Our agencies have to react to each of those situations specifically. Matthew Chesler - Deutsche Bank: Final question is a follow-up on the partnership structure. So I understand that it's a 12 month in duration of the partnership. Who's the investor? Did you need to get, did the banks have to agree to this transaction and are you considering this structure for 2032 to put if credit markets don't improve?

Let's see, it's a small group of investors. I don't believe they have an interest of being named. The banks didn't have to approve the structure where the controlling partner, where the general partner in the partnership. It's a fairly simple structure, we basically just drew down under our bank line to fund the bonds that were put. The partnership is a consolidated controlled entity of Omnicom. So it's not really any different than any one of our existing subsidiaries behind the bonds. The structure was designed to preserve the bonds for later or potentially later re-issuance to the marketplace, keeping the specific bonds alive in their structure et cetera. So we don't have to reinvent them and go through a whole re-issuance process. So it's really not a very complicated thing from a Omnicom perspective. It's basically like buying treasury stock. The bonds are effectively treasury bonds at this point. Matthew Chesler - Deutsche Bank: Are you considering the same structure for the June puts?

Well June... well there are June puts, there is end of July for the 2032 bond. Hopefully, the market is going to be dramatically improved by then. If it's not, it's something that I think we'll consider. We are just past 9.30. I guess we're running longer than normal. So I'm going to cut it off at this point, because I know a lot of investors you want to be there. A lot of analysts and people want to be there for the opening. Thank you all very much for taking the time to listen to our call.

Great and thank you. And ladies and gentlemen, that does conclude our conference for today. Thank you for your participation and for using AT&T's Executive Teleconference. You may now disconnect.