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Advertising Sir Martin Sorrell WPP

WPP shakes off Brexit blues as revenues rise

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By John Glenday, Reporter

August 24, 2016 | 2 min read

Advertising behemoth WPP has steadied following a post-Brexit wobble to post a 4.6 per cent increase in like-for-like group revenue for July with net sales increasing by 1.9 per cent.

Most pertinently WPP was boosted by an improved UK performance over the most recent quarter which the business attributes to a rapid devaluation of Sterling since the referendum result.

Despite apparently being in fine fettle WPP is urging caution going forward however, with other global concerns besides Brexit weighing on its mind. Chief amongst these is a $7tn net cash mountain hoarded by multi-nationals which is not being invested for growth but rather spent on dividend payments and share buybacks.

In a statement WPP wrote: “United Kingdom like-for-like revenue, perhaps reflecting pre-Brexit vote uncertainties, was 3.5 per cent, slower than the first quarter growth of 4.7 per cent, as the group’s media investment management businesses grew less strongly, although still double digit, together with parts of the group’s data investment management and public relations and public affairs businesses, which were also slower.

“Net sales overall showed a similar pattern to revenue, up slightly to 3.4 per cent like-for-like in the second quarter, compared with 3.2 per cent in the first quarter, with parts of the group’s advertising, data investment management and healthcare businesses stronger than the first quarter.”

WPP is also fearful of the potential disruption to established businesses by the rise of new business models such as Uber and Airbnb.

The advertising giant cautioned that Britain isn’t out of the woods yet and "might" still tip into recession despite apparently skirting the worst fears of collapse.

Advertising Sir Martin Sorrell WPP

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