Vincent Bollore's Havas has reported underlying revenue growth of 3.5% in the first quarter, ahead of investor expectations but below the rate of rivals such as Publicis, as its UK operation unexpectedly delivered a revenue decline.

The French marketing services group reported organic revenue growth, a key metric watched closely by analysts to gauge the underlying health of a business, of 3.5% to €387m (£316m) in the first quarter.

Havas's home market of France, which accounts for 20% of total revenues, performed well with organic revenue growth up 5.1% year-on-year to €80m.

The UK, however, saw growth go into reverse as revenue shrank by 0.2% to €44m, which Havas blamed on a "temporary slowdown in marketing services activities".

Havas said that Europe, which overall was up 1.1%, had a "highly satisfactory" performance that had unfortunately been pulled down by poor conditions in Spain and Portugal.

Havas's 3.5% organic revenue growth is below that of rivals - Publicis Groupe reported a 4.1% uplift and US giant Omnicom 5.1% - but shareholders were broadly pleased as the rate outpaced expectations.

In the first quarter of 2011 Havas reported organic growth of 6.8%, a tough comparison to improve on year-on-year.

"This was a good performance against a tough comparative and should be seen as reassuring," said analysts at UBS.

Havas's North Amercian business grew 3.6% to €136m.

The rest of the world put on good revenue growth of 12.3% to €58m, or 15% of total revenues, although emerging markets account for a tiny amount of revenues overall.

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