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WPP Grows Profits
WPP Group has reported half yearly results. Headline profit before tax rose over 24% to $566m (£316m) and like-for-like revenue was up a respectable 5% year-on-year. The Group's Information, Insight and Consultancy companies performed well although slightly behind other sectors on some key measures.
The group, whose MR division Kantar includes Millward Brown and Research International among many others, had total billings of $25.8bn (£14.4bn), up more than 27%. The like-for-like revenue figure is a slight increase on the 'encouraging' organic growth of 4.8% in the first quarter.
Slower growth in the UK had a limited impact on the overall performance of the group. Like-for-like revenue growth (which excludes the effects of currency movements and the impact of acquisitions) was only 1.2% in the UK, in North America and Continental Europe 4.5% each and in Asia Pacific, Latin America, Africa & the Middle East 9.4%.
The group says the record first half results reflect 'continued significant improvement over last year and further evidence of growth across the whole business, both functionally and geographically.' CEO Sir Martin Sorrell said the industry as a whole was becoming 'two paced' with rapid growth in new media contrasting with slow growth in traditional media; and slower growth in the mature markets of the US and Western Europe set against more rapid growth in Central and Eastern Europe, Asia, Latin America, Africa and the Middle East. Sorrell said prospects for the industry 'remain very good, as the need for differentiation through innovation and branding and global expansion grow.'
The Group's Information, Insight and Consultancy businesses continued their growth, with constant currency revenues increasing by almost 11% and operating margins improving. Revenue for this sector was £438.9m, and headline PBIT £41.5m. However, the sector trailed others in both profit and revenue terms. Branding & Identity, Healthcare and Specialist Communications was a comfortable leader in both:
Growth rates by operating sector
[table]
The group employees around 77,500 people, up 3.4% on the year. Its home page, with links to detailed investor information, is at www.wpp.com .
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