WPP posts impressive first-half profits |
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Sat, 27 Aug 2005 09:05
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LONDON - The world's second-largest advertising and marketing agency, WPP has reported a 6 percent jump in like-for-like first-half revenue in the first half of the year. The company said that this increase was in line with expectations and the performance had prompted it to raise its margin target.
WPP, the parent of JWT and Young & Rubicam also announced that its pre-tax profits for the first half of the year were up by 32 percent to £255 million. The company, which acquired Grey Global network in the earlier part of the year, also said that the overall revenues for the first six months ending June 30 had increased by 22 percent to £2.47 billion. Asia Pacific, Latin America, Africa and the Middle East took the honors as the best performing regions for the company with a 12.6 percent increase in like-for-like revenues.
WPP chief Sir Martin Sorrell commented, "By and large the growth is because of a general growth across the region, it's been the case for the last year or so, in Latin America it's even greater than in Asia. But Asia longer term will be stronger than Latin America." The growth in the Asia Pacific region was helped to a large extent by excellent growth in China and India. Thailand and Indonesia were also catching up, Sir Martin added.
North American revenues increased by 5.9 percent, while European revenues contributed 4 percent. UK revenues continued to lag behind at 2.7 percent. Traditional powerhouses Germany, France, Sweden and Denmark were lagging behind Central and Eastern European countries in terms of growth. Sir Martin observed that 15 percent of the group's revenues could be attributed to new media methods such as direct marketing, interactive advertising and the internet, "As traditional media - television, newspapers and magazines - come under pressure, direct, interactive and internet become more important. It's a big strategic challenge for clients in terms of trying to reposition," he observed.
WPP increased its interim dividend by 20 percent to 3.0 pence.
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