Strong Results from WPP as Sorrell Confirms NOP Bid

Business services giant and MR owner WPP has announced good results for 2004, with profit before tax up 30% to £465.5m. Chief Exec Martin Sorrell took the opportunity to confirm that his company is in the running for UBM's NOP World.

In addition to global MR names including Millward Brown, RI and BMRB, WPP owns ad agencies Young & Rubicam and J. Walter Thompson, and its recently cleared acquisition of New York-based Grey Global leaves it breathing down the neck of world No.1 ad firm Omnicom Group.

Sorrell cited increased ad spending as the major driver for the group's above-forecast results. Advertising around the US presidential election and the Olympics both contributed to a 15% rise in headline pretax profits to £546m for the calendar year 2004 (excludes goodwill and impairment). Revenues matched analyst predictions at £4.3bn, and new billings from Unilever, Nestle, Samsung and Procter & Gamble should boost its future prospects.

The 30% increase in profit before tax represents a rise of 41% at constant currencies. Operating margin was 14.1%, and WPP said that January 2005 like-for-like revenues were up 6%.

Sorrell told Reuters that WPP had submitted a proposal for United Business Media's NOP World market research unit and was waiting to hear if it would go through to the next round. Analysts have suggested a price range for NOP from £275m to £350m.

All of WPP's main geographic regions showed revenue growth in 2004, with a unit including Asia, the Middle East and Africa leading the way, up 24%. Similarly, all business sectors contributed: the branding, health care and specialty communications unit showed the biggest revenue gains (14.6%) with market research next, followed by advertising & media buying and public relations.

WPP's web site is at www.wpp.com

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.