WPP Sales Rise 1.2.% in First Five Months on U.K. Revenue Growth

Jun 25, 2014 7:21 am ET

June 25 (Bloomberg) -- WPP Plc, the world’s largest advertising agency, reported a 1.2 percent increase in revenue for the first five months this year led by sales in the U.K., U.S. and fast-growing markets.

Revenue rose to 4.43 billion pounds ($7.5 billion), the London-based company said today in a statement. WPP, which owns ad agencies including Young & Rubicam and Grey, said like-for- like sales, which strips out the impact of acquisitions and currency fluctuations, rose 7.6 percent.

Chief Executive Officer Martin Sorrell said in an interview last week that growth has slowed in fast-growth markets such as Brazil and India, though they are still outperforming more mature markets in the U.S. and Europe. He also forecast sporting events this year, such as the soccer World Cup in Brazil, will lift growth.

WPP said 2014 has started stronger than 2013 and like-for- like gross margin or net sales were up 4 percent, compared with 3.8 percent in the first quarter of 2014 and 4.3 percent in the fourth quarter of last year.

“Operating profit is above budget and well ahead of last year and the increase in the gross margin or net sales margin is in line with the group’s full year target of a 0.3 margin point improvement on a constant currency basis,” the company said in the statement.

Global ad revenue is set to exceed half a trillion dollars this year, Magna Global predicted in December. Sporting events including the Sochi Winter Olympics and World Cup will help boost the industry by 6.5 percent to $521.6 billion, the media- research company said.

Like-for-like sales in the U.K. rose 7 percent in the first five months and the region is strongest performer for WPP.