What changed in this filing

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Item 1. Financial Statements

2024-04-17 compared with 2023-10-18 · 109 added, 135 removed, 357 unchanged (41% of the section changed)

4 unchanged sentences

(In millions)

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Current Assets:

Cash and cash equivalents $ 3,172.8 $ 4,432.0

Short-term investments — 60.7

Accounts receivable, net of allowance for doubtful accounts of $ 23.0 and $ 17.2

14 unchanged sentences

Customer advances 1,238.2 1,356.2

Current portion of debt 750.3 750.5

Short-term debt 11.2 10.9

24 unchanged sentences

(In millions, except per share amounts)

Three Months Ended September 30,

Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

REVENUE $ 3,630.5 $ 3,443.3

2 unchanged sentences

Occupancy and other costs 314.1 291.6

Real estate and other repositioning costs — — 191.5 —

Charges arising from the effects of the war in Ukraine — — — 113.4

Gain on disposition of subsidiary — — ( 78.8 ) —

Real estate repositioning costs — 119.2

Cost of services 3,006.7 2,953.7

23 unchanged sentences

(In millions)

Three Months Ended September 30,

Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

NET INCOME $ 337.0 $ 243.9

20 unchanged sentences

(In millions, except per share amounts)

Three Months Ended September 30,

Nine Months Ended September 30,

2023 2022 2023 2022

COMMON STOCK:

Common Stock, shares issued 297.2 297.2 297.2 297.2

Three Months Ended March 31,

Common Stock, shares 297.2 297.2

Common Stock, par value $ 44.6 $ 44.6

27 unchanged sentences

Net change in noncontrolling interests ( 42.0 ) ( 13.4 )

Increase in noncontrolling interests from business combinations 93.3 0.8 93.3 48.6

Ending Balance 564.7 514.6

6 unchanged sentences

(In millions)

Nine Months Ended September 30,

Three Months Ended March 31,

CASH FLOWS FROM OPERATING ACTIVITIES:

5 unchanged sentences

Share-based compensation 22.1 20.7

Real estate and other repositioning costs 191.5 —

Gain on disposition of subsidiary ( 78.8 ) —

Non-cash charges related to the effects of the war in Ukraine — 65.8

Real estate repositioning costs — 119.2

Other, net ( 5.0 ) ( 10.2 )

4 unchanged sentences

Acquisition of businesses and interests in affiliates, net of cash acquired ( 801.5 ) —

Maturity (purchase) of short-term investments 60.8 ( 100.0 )

Proceeds from disposition of subsidiary and other 192.6 35.6

Net Cash Provided By (Used In) Investing Activities 108.6 ( 406.9 )

Other, net ( 13.7 ) ( 14.5 )

Net Cash Used In Investing Activities ( 838.3 ) ( 37.6 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from borrowings 645.9 —

Change in short-term debt 0.3 1.0

6 unchanged sentences

Other, net ( 21.8 ) ( 8.0 )

Net Cash Used In Financing Activities ( 1,173.7 ) ( 1,089.6 )

Net Cash Provided By (Used In) Financing Activities 283.4 ( 479.0 )

Effect of foreign exchange rate changes on cash and cash equivalents ( 85.8 ) 18.4

3 unchanged sentences

The accompanying notes to the consolidated financial statements are an integral part of these statements.

OMNICOM GROUP INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Amounts in tables in millions, except per share data or unless otherwise noted)

(Dollars in tables in millions, except per share amounts)

Presentation of Financial Statements

8 unchanged sentences

Risks and Uncertainties

Current global economic challenges, including the impact of the ongoing war in Ukraine, high and persistent inflation, rising interest rates, supply chain disruptions, credit market deterioration, and other macroeconomic factors, could cause economic uncertainty and volatility.

Global economic challenges, including geopolitical events, international hostilities, acts of terrorism, public health crises, high and sustained inflation in countries that comprise our major markets, high interest rates, and labor and supply chain issues could cause economic uncertainty and volatility.

The impact of these issues on our business will vary by geographic market and discipline.

5 unchanged sentences

Our networks, practice areas and agencies provide a comprehensive range of services in the following fundamental disciplines:

Advertising & Media, Precision Marketing, Commerce & Branding, Experiential, Execution & Support, Public Relations and Healthcare.

Advertising & Media, Precision Marketing, Public Relations, Healthcare, Branding & Retail Commerce, Experiential, and Execution & Support.

Advertising & Media includes creative services across digital and traditional media, strategic media planning and buying, performance media and data analytics services.

Precision Marketing includes digital and direct marketing, digital transformation consulting and data and analytics.

Commerce & Branding services include brand and product consulting, strategy and research, retail and ecommerce.

Experiential marketing services include live and digital events and experience design and execution.

Execution & Support includes field marketing, digital and physical merchandising, point-of-sale and product placement, as well as other specialized marketing and custom communications services.

Precision Marketing includes digital and direct marketing, digital transformation consulting, e-commerce operations, media execution, market intelligence and data and analytics.

Public Relations services include corporate communications, crisis management, public affairs and media and media relations services.

Healthcare includes corporate communications and advertising and media services to global healthcare and pharmaceutical companies.

Branding & Retail Commerce services include brand and product consulting, strategy and research and retail marketing.

Experiential marketing services include live and digital events and experience design and execution.

Execution & Support includes field marketing, sales support, digital and physical merchandising, point-of-sale and product placement, as well as other specialized marketing and custom communications services.

At the core of all our services is the ability to create or develop a client’s marketing or corporate communications message into content that can be delivered to a target audience across different communications mediums.

3 unchanged sentences

Revenue by discipline:

Three Months Ended September 30,

Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Advertising & Media $ 1,906.8 $ 1,776.5

Precision Marketing 438.2 360.0

Commerce & Branding 211.6 211.9 631.7 630.3

Experiential 133.3 120.6 445.5 412.3

Execution & Support 206.1 262.0 673.2 811.2

Public Relations 390.3 375.5

Healthcare 323.6 318.4

Branding & Retail Commerce 200.2 209.6

Experiential 159.9 147.8

Execution & Support 211.5 255.5

Revenue $ 3,630.5 $ 3,443.3

Effective January 1, 2023, we realigned the classification of certain services primarily within our Commerce & Branding, Execution & Support, and Experiential disciplines and prior year amounts have been reclassified .

Revenue by geographic market:

Three Months Ended September 30,

Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

North America $ 2,040.9 $ 1,926.8

7 unchanged sentences

Asia-Pacific includes Australia, Greater China, India, Japan, Korea, New Zealand, Singapore and other Asian countries.

Revenue in the United States for the three months ended September 30, 2023, and 2022 was $ 1,868.8 million and $ 1,847.8 million, respectively, and revenue in the United States for nine months ended September 30, 2023, and 2022 was $ 5,531.6 million and $ 5,415.2 million, respectively.

Contract assets and contract liabilities

September 30, 2023 December 31, 2022 September 30, 2022

Contract assets:

Revenue in the United States for the three months ended March 31, 2024, and 2023 was $ 1,925.9 million and $ 1,812.2 million, respectively.

Contract balances

Contract balances include work in process and customer advances, which primarily consist of advance billings to customers in accordance with the terms of the client contracts, primarily for the reimbursement of third-party costs.

March 31, 2024 December 31, 2023 March 31, 2023

Work in process:

Media and production costs $ 788.8 $ 664.4 $ 710.9

Contract assets and unbilled fees and costs 856.0 529.5 684.2

Unbilled fees and costs and contract assets 922.8 678.1 798.0

Work in process $ 1,711.6 $ 1,342.5 $ 1,508.9

Contract liabilities:

Customer advances $ 1,238.2 $ 1,356.2 $ 1,279.6

Work in process represents accrued costs incurred on behalf of customers, including media and production costs, and fees and other third-party costs that have not yet been billed.

Media and production costs are billed during the production process in accordance with the terms of the client contract.

Contract assets primarily include incentive fees, which are not material and will be billed to clients in accordance with the terms of the client contract.

Substantially all unbilled fees and costs will be billed within the next 30 days.

There were no impairment losses to the contract assets recorded in the nine months ended September 30, 2023 and 2022.

Contract liabilities primarily represent advance billings to customers in accordance with the terms of the client contracts, principally for the reimbursement of third-party costs that are generally incurred in the near term.

There were no impairment losses to work in process recorded in the three months ended March 31, 2024 and 2023.

Net Income per Share

The computations of basic and diluted net income per share:

Three Months Ended September 30,

Nine Months Ended September 30,

2023 2022 2023 2022

Basic and diluted net income per share:

Three Months Ended March 31,

Net Income - Omnicom Group Inc.

$ 318.6 $ 227.5

Weighted Average Shares:

Weighted Average Shares (millions):

Basic 197.9 202.2

1 unchanged sentence

Diluted 200.1 204.5

Anti-dilutive stock options and restricted shares — 5.1 — 4.3

Net Income per Share - Omnicom Group Inc.:

1 unchanged sentence

Diluted $ 1.59 $ 1.11

Business Combinations

On January 2, 2024 , we acquired Flywheel Digital, the digital commerce business of Ascential plc, for a net cash purchase price of approximately $ 845 million .

The financial statements of Flywheel Digital are included in our consolidated financial statements as of and for the period ended March 31, 2024.

The acquisition of Flywheel Digital did not have a material effect on our financial position or results of operations in the three months ended March 31, 2024 and is not expected to do so for the remainder of the year.

The principal tangible assets and liabilities acquired were net working capital, and the intangible assets acquired were primarily comprised of customer relationships, intellectual property, trade name and goodwill.

The allocation of the purchase price to the underlying assets is undergoing a formal valuation process that is not yet complete.

As a result, as of March 31, 2024, we estimated amortizable intangible assets to be $ 182.6 million.

We will likely revise this estimate, however, we do not expect any changes to be material to our financial position and results of operations.

Goodwill and Intangible Assets

Change in goodwill:

Nine Months Ended September 30,

Three Months Ended March 31,

January 1 $ 10,082.3 $ 9,734.3

Acquisitions 688.3 —

Noncontrolling interests in acquired businesses 90.7 48.5

Contingent purchase price obligations of acquired businesses 170.1 8.7

Dispositions ( 5.9 ) ( 1.4 )

1 unchanged sentence

$ 10,693.8 $ 9,792.6

There were no goodwill impairment losses recorded in the nine months ended September 30, 2023 and 2022, and there are no accumulated goodwill impairment losses.

The increase in goodwill during the three months ended March 31, 2024 is primarily attributable to the acquisition of Flywheel Digital.

There were no goodwill impairment losses recorded in the three months ended March 31, 2024 and 2023, and there are no accumulated goodwill impairment losses.

Intangible assets:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Value Accumulated

2 unchanged sentences

Amortization Net

Purchased and internally developed software

Acquired intangible assets and internally developed strategic platform assets

$ 1,084.3 $ ( 585.6 ) $ 498.7 $ 902.6 $ ( 572.9 ) $ 329.7

Customer related and other 852.9 ( 531.6 ) 321.3 758.5 ( 510.8 ) 247.7

Other purchased and internally developed software 306.2 ( 271.9 ) 34.3 327.9 ( 290.7 ) 37.2

Total Intangible Assets $ 1,390.5 $ ( 857.5 ) $ 533.0 $ 1,230.5 $ ( 863.6 ) $ 366.9

We completed our annual goodwill impairment test as of May 1, 2023.

The market assumptions used in our assessment reflected the current economic environment (see Note 1- Risks and Uncertainties ).

Based on the results of our impairment test, we concluded that as of May 1, 2023 our goodwill was not impaired.

In 2023, to better align with our internal financial processes, the date of our annual impairment test was changed from June 30 to May 1.

Amortization of intangible assets:

Three Months Ended March 31,

Acquired intangible assets and internally developed strategic platform assets $ 21.5 $ 14.8

Other purchased and internally developed software 4.3 4.5

Amortization Expense $ 25.8 $ 19.3

Credit Facilities

In June 2023, we amended our existing $ 2.5 billion unsecured multi-currency revolving credit facility, or Credit Facility, to, among other things, extend the termination date of the Credit Facility to June 2, 2028 and transition the benchmark rate for U.S.

Dollar denominated loans from LIBOR to the Secured Overnight Financing Rate, or SOFR.

We have a $ 2.5 billion unsecured multi-currency revolving credit facility, or Credit Facility, terminating on June 2, 2028 .

On January 3, 2024, we entered into a $ 600 million Delayed Draw Term Loan Agreement, or Term Loan Facility, terminating on December 31, 2026.

We have the ability to issue up to $ 2 billion of U.S.

Dollar denominated commercial paper and issue up to the equivalent of $ 500 million in British Pounds or Euro under a Euro commercial paper program.

In the third quarter of 2023, we issued commercial paper with a maximum amount outstanding of $ 60 million.

At September 30, 2023, there were no outstanding borrowings under the Credit Facility, and no outstanding commercial paper issuances.

During the three months ended March 31, 2024, there were no drawings under the Credit Facility or the Term Loan Facility, and no commercial paper issuances.

In addition, certain of our international subsidiaries have uncommitted credit lines, aggregating $ 507.0 million, that are guaranteed by Omnicom.

All these credit facilities provide additional liquidity sources for operating capital and general corporate purposes.

The Credit Facility contains a financial covenant that requires us to maintain a Leverage Ratio of consolidated indebtedness to consolidated EBITDA (earnings before interest, taxes, depreciation, amortization and non-cash charges) of no more than 3.5 times for the most recently ended 12-month period.

At September 30, 2023, we were in compliance with this covenant as our Leverage Ratio was 2.4 times.

The Credit Facility does not limit our ability to declare or pay dividends or repurchase our common stock.

All of these facilities provide additional liquidity sources for operating capital and general corporate purposes.

The Credit Facility and Term Loan Facility each contain a financial covenant that requires us to maintain a Leverage Ratio of consolidated indebtedness to consolidated EBITDA (earnings before interest, taxes, depreciation, amortization and non-cash charges) of no more than 3.5 times for the most recently ended 12-month period.

At March 31, 2024, we were in compliance with this covenant as our Leverage Ratio was 2.5 times.

The Credit Facility and Term Loan Facility do not limit our ability to declare or pay dividends or repurchase our common stock.

Short-Term Debt

Short-term debt of $ 14.5 million and $ 16.9 million at September 30, 2023 and December 31, 2022, respectively, represented bank overdrafts and short-term borrowings primarily of our international subsidiaries.

Short-term debt of $ 11.2 million and $ 10.9 million at March 31, 2024 and December 31, 2023, respectively, represented bank overdrafts and short-term borrowings primarily of our international subsidiaries.

Due to the short-term nature of this debt, carrying value approximates fair value.

1 unchanged sentence

Long-term debt:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

3.65 % Senior Notes due 2024

8 unchanged sentences

€ 600 million 3.70 % Senior Notes due 2032

£ 325 million 2.25 % Senior Notes due 2033

Long-Term Debt, Gross 6,286.3 5,669.9

1 unchanged sentence

Unamortized debt issuance costs ( 25.7 ) ( 22.3 )

Unamortized deferred gain (loss) from settlement of interest rate swaps, net — 0.6

Unamortized deferred loss from settlement of interest rate swaps, net ( 0.4 ) ( 0.2 )

Current portion ( 750.3 ) ( 750.5 )

Long-Term Debt $ 5,501.0 $ 4,889.1

On March 6, 2024, Omnicom Finance Holdings plc, or OFH, a U.K.-based wholly owned subsidiary of Omnicom, issued € 600 million 3.70 % Senior Notes due 2032.

The net proceeds from the issuance, after deducting the underwriting discount and offering expenses, were $ 643.1 million.

Omnicom has fully and unconditionally guaranteed the obligations of OFH.

Our 2.45 % Senior Notes due 2030, 4.20 % Senior Notes due 2030 and 2.60 % Senior Notes due 2031 are senior unsecured obligations of Omnicom that rank equal in right of payment with all existing and future unsecured senior indebtedness.

5 unchanged sentences

Such notes are senior unsecured obligations that rank equal in right of payment with all existing and future unsecured senior indebtedness.

Omnicom and OCI have, jointly and severally, fully and unconditionally guaranteed the obligations of Omnicom Finance Holdings plc, or OFH, a U.K.-based wholly owned subsidiary of Omnicom, with respect to the € 500 million 0.80 % Senior Notes due 2027 and the € 500 million 1.40 % Senior Notes due 2031, collectively the Euro Notes.

Omnicom and OCI have, jointly and severally, fully, and unconditionally guaranteed the obligations of OFH with respect to the € 500 million 0.80 % Senior Notes due 2027 and the € 500 million 1.40 % Senior Notes due 2031, and Omnicom has fully and unconditionally guaranteed the obligations of OFH with respect to the € 600 million 3.70 % Senior Notes due 2032, collectively the Euro Notes.

OFH’s assets consist of its investments in several wholly owned finance companies that function as treasury centers, providing funding for various operating companies in Europe, Australia, and other countries in the Asia-Pacific region.

1 unchanged sentence

There are no restrictions on the ability of Omnicom, OCI or OFH to obtain funds from their subsidiaries through dividends, loans, or advances.

The Euro Notes and the related guarantees are senior unsecured obligations that rank equal in right of payment with all existing and future unsecured senior indebtedness of OFH and each of Omnicom and OCI, respectively.

Omnicom has fully and unconditionally guaranteed the obligations of Omnicom Capital Holdings plc, or OCH, a U.K.-based wholly owned subsidiary of Omnicom, with respect to the £ 325 million 2.25 % Senior Notes due 2033, or Sterling Notes.

OCH’s assets consist of its investments in several wholly owned finance companies that function as treasury centers, providing funding for various operating companies in EMEA, Australia, and other countries in the Asia-Pacific region.

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Therefore, given these similarities, we aggregate our six operating segments, which are our agency networks, into one reporting segment.

The agency networks' regional reporting units comprise three regions:

The agency networks' regional reporting units comprise three principal regions:

the Americas, EMEA and Asia-Pacific.

3 unchanged sentences

Americas EMEA Asia-Pacific

September 30, 2023

March 31, 2024

Revenue - Three months ended $ 2,137.4 $ 1,085.4 $ 407.7

Revenue - Nine months ended $ 6,146.8 $ 3,213.4 $ 1,271.1

Long-lived assets and goodwill $ 8,092.0 $ 3,776.5 $ 706.6

September 30, 2022

March 31, 2023

Revenue - Three months ended $ 2,000.8 $ 1,036.8 $ 405.7

Revenue - Nine months ended $ 6,002.4 $ 3,133.9 $ 1,284.6

Long-lived assets and goodwill $ 7,642.2 $ 3,377.2 $ 734.4

Our effective tax rate for the nine months ended September 30, 2023 decreased period-over-period to 26.3 % from 28.8 %.

The nine months ended September 30, 2023 includes an increase of $ 10.7 million in income tax expense related to a lower tax benefit in certain jurisdictions for the real estate and other repositioning costs and an increase in the U.K.

statutory tax rate, partially offset by $ 10.0 million of previously unrecognized tax benefits.

The higher effective tax rate for the nine months ended September 30, 2022 was predominantly due to the non-deductibility of the $ 113.4 million of charges recorded in the first quarter of 2022, arising from the effects of the war in Ukraine, as well as an additional increase in income tax expense of $ 4.8 million related to the disposition of our businesses in Russia.

Our effective tax rate for the three months ended March 31, 2024 increased period-over-period to 25.7 % from 25.5 %.

The effective tax rate for three months ended March 31, 2024 includes the favorable impact from the resolution of certain non-U.S.

tax positions of $ 7.5 million.

The effective tax rate for the three months ended March 31, 2023 includes the favorable impact from the resolution of certain tax positions of approximately $ 10.0 million of previously unrecognized tax benefits, partially offset by approximately $ 6.0 million related to a lower tax benefit in certain jurisdictions for the real estate repositioning costs in the quarter, and an increase in the U.K.

statutory tax rate.

The Inflation Reduction Act of 2022, or IRA, levies a 1% excise tax on net stock repurchases after December 31, 2022.

The excise tax is recorded as part of the cost of acquiring treasury stock and is not material.

The excise tax is recorded as a cost of acquiring treasury stock and is not material.

Additionally, the IRA imposes a 15% corporate alternative minimum tax, or CAMT, for tax years beginning after December 31, 2022.

The CAMT is not expected to have a material impact on our results of operations or financial position.

Various foreign jurisdictions are in the process of enacting legislation to adopt a minimum effective tax rate described in the Global Anti-Base Erosion, GloBE or Pillar Two, model rules issued by the Organization for Economic Co-operation and Development.

A minimum effective tax rate of 15% would apply to multinational companies with consolidated revenue above €750 million.

Currently, Japan, South Korea and the United Kingdom have enacted legislation effective beginning in 2024 that is consistent with the GloBE rules.

Other countries are expected to adopt GloBE rules within the next year.

Under the GloBE rules, a company would be required to determine a combined effective tax rate for all entities located in a jurisdiction.

If the jurisdictional effective tax rate is less than 15%, a top-up tax generally will be due to bring the jurisdictional effective tax rate up to 15%.

At September 30, 2023, our unrecognized tax benefits were $ 159.8 million.

The CAMT does not have a material impact on our results of operations or financial position.

Numerous foreign jurisdictions have enacted or are in the process of enacting legislation to adopt a minimum effective tax rate described in the Global Anti-Base Erosion, or Pillar Two, model rules issued by the Organization for Economic Co-operation and Development, or OECD.

Under such rules, a minimum effective tax rate of 15% would apply to multinational companies with consolidated revenue above €750 million.

Under the Pillar Two rules, a company would be required to determine a combined effective tax rate for all entities located in a jurisdiction.

If the jurisdictional effective tax rate determined under the Pillar Two rules is less than 15%, a top-up tax will be due to bring the jurisdictional effective tax rate up to 15%.

We are continuing to monitor the pending implementation of Pillar Two by individual countries and the potential effects of Pillar Two on our business.

We do not expect the provisions effective in 2024 to have a materially adverse impact on our results of operations, financial position or cash flows.

At March 31, 2024, our unrecognized tax benefits were $ 168.7 million.

Of this amount, approximately $ 161.8 million would affect our effective tax rate upon resolution of the uncertain tax positions.

3 unchanged sentences

Postemployment Arrangements

Nine Months Ended September 30,

Three Months Ended March 31,

2024 2023 2024 2023

5 unchanged sentences

Total net periodic benefit expense $ 1.7 $ 3.3 $ 3.5 $ 3.3

We contributed $ 0.3 million and $ 0.4 million to our defined benefit pension plans in both the nine months ended September 30, 2023 and 2022, respectively .

Real Estate and Other Repositioning Costs

We contributed $ 0.1 million to our defined benefit pension plans in each of the three months ended March 31, 2024 and 2023.

Real Estate Repositioning Costs

In connection with the transition to a flexible working environment, a hybrid model which allows for partial remote work, we took certain actions in the first quarter of 2023 to reduce and reposition our office lease portfolio.

In the second quarter of 2023, as a result of our continuing efforts to increase efficiencies and relevant skill sets to meet client demands, we incurred severance charges and other exit costs associated with rebalancing our workforce and consolidating operations in certain markets.

As a result, for the nine months ended September 30, 2023, operating expenses included $ 191.5 million ($ 145.5 million after tax), primarily related to non-cash impairment charges for the operating lease right-of-use, or ROU, assets, severance charges, and other exit costs.

There were no real estate and other repositioning charges during the three months ended September 30, 2023.

All severance and other costs will be paid in less than one year.

Substantially all of the operating lease payments related to the ROU assets will be paid out over three years.

Disposition of Subsidiaries

In April 2023, we disposed of certain research businesses included in our Execution & Support discipline.

As a result, we recorded a pretax gain of $ 78.8 million.

The disposition will not have a material impact on our ongoing results of operations or financial position.

Charges Arising from the Effects of the War in Ukraine

In 2022, we disposed of our businesses in Russia.

In the first quarter of 2022, we recorded pretax charges of $ 113.4 million, which included cash charges of $ 47.6 million and primarily consisted of the loss on the disposition of our net investment in our Russian businesses and included charges related to the suspension of operations in Ukraine.

All of the charges related to the disposition of our businesses in Russia had been paid as of December 31, 2022, and substantially all of our commitments related to the suspension of operations in Ukraine have been paid .

As a result, for the three months ended March 31, 2023, operating expenses included $ 119.2 million ($ 91.0 million after tax), primarily related to non-cash impairment charges for the operating lease right-of-use, or ROU, assets.

Substantially all of the operating lease payments related to the ROU assets will be paid out over two years.

There were no real estate repositioning charges during the three months ended March 31, 2024.

Supplemental Cash Flow Data

Change in operating capital:

Nine Months Ended September 30,

Three Months Ended March 31,

(Increase) decrease in accounts receivable $ 884.2 $ 1,065.0

4 unchanged sentences

Increase (decrease) in operating capital $ ( 1,033.6 ) $ ( 951.0 )

Supplemental financial information:

Three Months Ended March 31,

Income taxes paid $ 69.4 $ 73.6

5 unchanged sentences

In the ordinary course of business, we are involved in various legal proceedings.

We do not presently expect that these proceedings will have a material adverse effect on our results of operations or financial position.

We do not presently expect that such proceedings will have a material adverse effect on our results of operations or financial position.

Accumulated Other Comprehensive Income (Loss)

2 unchanged sentences

Currency Translation Total

Nine Months Ended September 30, 2023

Three Months Ended March 31, 2024

January 1 $ ( 8.1 ) $ ( 42.7 ) $ ( 1,286.8 ) $ ( 1,337.6 )

3 unchanged sentences

$ ( 7.1 ) $ ( 42.9 ) $ ( 1,365.9 ) $ ( 1,415.9 )

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

January 1 $ ( 12.1 ) $ ( 41.3 ) $ ( 1,384.5 ) $ ( 1,437.9 )

10 unchanged sentences

Financial assets and liabilities measured at fair value on a recurring basis:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

Cash and cash equivalents $ 3,172.8 $ 3,172.8 $ 4,432.0 $ 4,432.0

Short-term investments $ — — $ 60.7 60.7

Marketable equity securities 0.8 0.8 0.9 0.9

Foreign currency derivatives $ — $ — $ 0.1 $ 0.1

Cross currency swaps - net

investment hedge $ 4.2 4.2 $ — —

Cross currency swaps - net

investment hedge — — $ 6.6 $ 6.6

Contingent purchase price obligations $ 258.6 258.6 $ 229.5 229.5

Change in the Level 3 fair value measurement of contingent purchase price obligations:

Nine Months Ended September 30,

Changes in contingent purchase price obligations:

Three Months Ended March 31,

January 1 $ 229.5 $ 115.0

5 unchanged sentences

Carrying amount and fair value of our financial assets and liabilities:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Value Carrying

Cash and cash equivalents $ 3,172.8 $ 3,172.8 $ 4,432.0 $ 4,432.0

Short-term investments — — 60.7 60.7

Marketable equity securities 0.8 0.8 0.9 0.9

Cross currency swaps - net investment hedge 4.2 4.2 — —

Non-marketable equity securities 12.5 12.5 6.7 6.7

Short-term debt $ 11.2 $ 11.2 $ 10.9 $ 10.9

Foreign currency derivatives — — 0.1 0.1

Cross currency swaps - net investment hedge — — 6.6 6.6

1 unchanged sentence

Long-term debt 6,251.3 5,822.1 5,639.6 5,237.8

The estimated fair values of the cross-currency swaps and foreign currency derivative instruments are determined using model-derived valuations, taking into consideration foreign currency rates, interest rates, and counterparty credit risk.

The estimated fair values of the cross-currency swaps are determined using model-derived valuations, taking into consideration foreign currency rates, interest rates, and counterparty credit risk.

The estimated fair value of the contingent purchase price obligations is calculated in accordance with the terms of each acquisition agreement and is discounted.

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements