WPP reports two per cent revenue decline with strongest performance in PR

WPP has reported revenues were £2.08bn in the first quarter of 2010, down just under two per cent from last year.

Martin Sorrell: WPP chief
Martin Sorrell: WPP chief

On a constant currency basis revenues rose by 0.5 per cent, reflecting the strength of the pound sterling against the US dollar and Euro. On a like-for-like basis, excluding the impact of acquisitions and currency fluctuations, revenues were flat.

The group, led by Sir Martin Sorrell, saw PR and public affairs revenues of £199.7m during the quarter, a decline of 0.9 per cent, but a rise of 2.8 per cent on a constant currency basis.

PR was the strongest performer of its four business groups. Its advertising, media investment management business and its consumer insight division both posted small revenue declines on a constant currency basis.

North America was its strongest market with 3.2 per cent constant currency growth, with the UK the next best performer after growing revenues by 0.2 per cent on a constant currency basis.

The group said that overall revenues had stabilised following declines of 5.8 per cent in the same quarter last year, 7.2 per cent in the final quarter of last year and more than eight per cent last year.

In its interim statement, the group said: ‘The first half of 2010 should be much better than the first half of 2009, both in terms of profitability and margins, as revenue stabilisation, possible growth and the cost actions taken in the second half of 2009 take effect.'

However, it warned: ‘Concerns still remain over when and how the fiscal and monetary stimuli will be withdrawn, particularly in the Western world. Too quickly and the recovery will falter, with unemployment rising. Too slowly, inflation and interest rates rise... Whichever way, economic growth in the West in particular is likely to be slow and a slog.'

Meanwhile, Interpublic Group's Constituency Management Group (CMG), which houses PR agencies Weber Shandwick and GolinHarris, has announced its revenue increased 5.4 per cent year-on-year to $221.8m.

PR revenues grew by 6.4 per cent, thanks to strong demand in the US.

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