WPP PLC updates
Sign up to myFT Daily Digest to be the first to know about WPP PLC news.
The advertising group WPP said its revenues had returned to pre-pandemic levels a year sooner than expected on the back of a stronger than anticipated resurgence in global marketing expenditure.
WPP reported revenues of £6.1bn in the first half, a year-on-year increase of 16 per cent on a like-for-like basis, as clients that had slashed ad budgets at the onset of the pandemic pushed their brands to benefit from the economic recovery.
The owner of agencies including Ogilvy, GroupM and Hogarth Worldwide, which had said it anticipated returning to 2019 levels of annual revenues by 2022, now expects to do so for the full year.
Digital media was capturing much of the growth, said the world’s largest advertising group by revenues. The group cited GroupM research that forecast a recovery in television ad spend this year, but at slower rates than digital. While most other advertising channels were on track to “stabilise or grow” this year, spending through newspapers and magazines was expected to decline.
Mark Read, chief executive, said clients were focusing on “digital media, ecommerce and marketing technology”.
The London-based group said spending was recovering “across all sectors” as it joined smaller rivals Publicis, Omnicom and Interpublic in reporting a recovery despite persistent concerns about coronavirus.
Revenues rebounded in all regions in the six months to June 30, led by like-for-like increases of 22 per cent in the UK and 24 per cent in western continental Europe. They remained beneath 2019 levels in France and Spain.
WPP’s board declared an interim dividend of 12.5p, an increase of 25 per cent, after pre-tax profits improved from £276m the same period a year ago to £502m.
The group bought back £248m worth of shares in the first half and plans a further £350m in the second.
Net debt at WPP, which also owns data company Kantar and public relations consultancy Finsbury Glover Hering, stood at £1.5bn at the end of the period, a reduction of £1.2bn from the same period a year ago.