Sir Martin paints rosy picture for WPP in 2012 ... but 2013 is murkier
So how are things at WPP, the world's largest clutch of agencies ? The first quarter of 2012 painted a picture brighter than you might have expected. Revenues were up 5.5% to $3.76 billion and profit was better than expected - compared with a year ago at this time.
Sir Martib: upbeat for 2012
How much better, CEO Sir Martin Sorrell wasn't telling analysts in a conference call - but he did say he was optimistic about the remainder of the year and he did NOT not anticipate the "deceleration" that CEO Maurice Levy, of Publicis Groupe, forecast for the second quarter.
WPP , parent of agencies such as Ogilvy & Mather and JWT and the world's biggest media buyer Group M, picked up $1.85 billion in new business in the first quarter. Three big captures were L'Oreal in Germany, Eithad Airways and Levi Strauss & Co.
There were losses too. Mindshare lost its Sprint media business, worth a billion in billings to Publicis Groupe. Grey and Ogilvy lost smaller accounts with GlaxoSmithKline and Kraft.
In world terms, the leading growth areas for WPP were Asia and Latin America. Revenue grew upwards of 15% in the first quarter in countries like Argentina, Brazil, China and South Korea grew. Almost 31% of revenues came from direct, digital and interactive services, up 2 percentage points on a year ago.
There was a big leap in acquisitions, said Sir Martin: up 50% compared with a year ago. In the first quarter, WPP spent almost $44 million on 14 buys and upping equity stakes .
Examples: they bought the agency Carnation in Hungary and social-media research firm CIC Data, a stake in DT Digital in Australia and invested in mysupermarket.com.
What adds to Sir Matin's optimism is increased ad spending around the London Olympics,the UEFA Football Championships and the U.S. presidential elections.
The following year might be tougher, without any major events to drive spending. "The big question going into 2013: what's going to happen to the U.S. economy?," said Sir Martin told the analysts.