WPP PR, public affairs revenue down slightly

LONDON: WPP Group reported that its PR and public affairs sector was down 1% on a like-for-like basis to $1.4 billion in 2012, compared with the prior year.

LONDON: WPP Group reported that its PR and public affairs sector was down 1% on a like-for-like basis to $1.4 billion in 2012, compared with the prior year.

The PR and public affairs division's slight drop in revenue was attributed mainly to pressure in North America and continental Europe. Growth in this sector was seen in the UK, Latin America, the Middle East, and Africa.

WPP, which owns Burson-Marsteller, Ogilvy Public Relations, Cohn & Wolfe, Hill+Knowlton Strategies, and other firms, reported that overall revenue was up 2.9% on a like-for-like basis to $16.5 billion in 2012, beating analysts' expectations of 2.6% growth. It reported an operating profit of nearly $2 billion and profit for the year of $1.4 billion.

Overall North American revenue fell 0.1% on a like-for-like basis last year to $5.3 billion. The region also saw a decline in operating profit in the fourth quarter of 0.6%.

WPP said in the earnings report that the company's advertising and media investment management businesses in North America saw strong growth, unlike its consumer insight, public relations and public affairs, branding and identity, healthcare, and specialist communications businesses sectors. The group said in the earnings statement that this divide “seems to be indicative of continued pressure on discretionary client spending.”

In Q4, WPP reported like-for-like overall revenue up 2.5%, with growth in all regions except North America.

Throughout 2012, the group garnered $6.2 billion in net new business, up almost 21% year-over-year. It cited team wins of business from Bank of America, IHG, Team Chemistry, MillerCoors, News Corp., and Team Pfizer in an analyst presentation.

The group also said in the earnings statement that 2013 “looks to be another demanding year” due to a lack of big events and the deficit and debt situation in the US.

Next year “looks a better prospect, however, with the World Cup in Brazil, the Winter Olympics in Sochi and, would you believe, another United States election - the mid-term Congressionals,” WPP said. 

It said group budgets indicate 3% revenue growth this year "with continued strong growth in faster-growing markets and slower growth in mature markets and functionally faster growth in media investment management and digital."

WPP noted in an earnings presentation that like-for-like growth in January 2013 was over 2%, and that the business is "well positioned with headcount held flat over 2012 and steps taken in Q4 to address more difficult structural issues."

This story was updated on March 1 with more information on WPP's Q4 and 2012 financial results.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Would you like to post a comment?

Please Sign in or register.