WPP PR growth accelerated in Q3 amid 'strong momentum'

Like-for-like revenue in WPP's PR arm grew 16 per cent in the third quarter of 2021, with Burson Cohn & Wolfe and Hill+Knowlton Strategies highlighted for their strong performance.

In a trading update this morning, WPP said it is now trading "above 2019 levels in all of our business lines".

Overall revenue in the PR division, which also includes Finsbury Glover Hering, rose 10.4 per cent versus the same quarter last year, reaching £231m.

Growth accelerated in the third quarter – comparable like-for-like revenue growth in Q2 was 12.9 per cent. Like-for-like growth was up 12.6 per cent on Q3 2019, before the onset of the coronavirus pandemic (the figures exclude 'pass-through' costs).

WPP said of Q3 2021: "Demand for board-level strategic communications advice remains strong, and Specialist PR was again the best performer. Both BCW and H+K Strategies maintained strong momentum, with growth accelerating from the second quarter."

For the first nine months of 2021, like-for-like revenue excluding pass-through costs in the PR arm grew 10.3 per cent to £660m.

The division outperformed WPP's Global Integrated Agencies division in Q3, where comparable like-for-like growth was 13.5 per cent. Like-for-likes at the Specialist Agencies division surged 41.5 per cent.

Guidance raised

WPP raised its guidance for 2021 today as it reported a 15.7 per cent rise in like-for-like revenue (excluding pass-through costs) in Q3, reaching £2.64bn.

Growth in Q3 was strongest in Western Continental Europe (21.5 per cent). Growth in the UK was 16.9 per cent, ahead of its Asia Pacific, Latin America, Africa & Middle East and Central & Eastern Europe region (15.6 per cent) and North America (12.2 per cent) – US growth was 12.4 per cent.

Growth in Greater China was 18 per cent, in Germany it was 34.5 per cent, and in Australia it was 2.4 per cent.

WPP said it now expects like-for-like revenue growth (excluding pass-through costs) of between 11.5 and 12 per cent for the year, up from the previous expectation of nine to 10 per cent growth.

The holding company expects headline operating margin for 2021 of "slightly above" 14 per cent – previous expectations were "towards the upper end" of 13.5 per cent to 14 per cent. WPP is set to complete its £600m share buyback programme in December, the group said, having bought back £448m so far this year.

WPP chief executive Mark Read said: "Our very strong performance goes well beyond a cyclical recovery, with like-for-like growth over 2019 at 6.9 per cent in the quarter. Clients across all sectors and geographies are making significant investments in marketing, particularly in digital media and ecommerce services, and with the actions we have taken over the last three years, we are even better positioned for growth."

The group won new business worth $1.7bn in the quarter, and $4.6bn in the year to date. "In new business, we continued to perform well," WPP stated. "Most importantly, we retained our long-term partnership with Unilever in media after a thorough review. Including the business won in China last year, we have expanded our remit with Unilever. We also grew our relationship with Bayer, adding the key markets of Germany, Russia and China to our existing media responsibilities. During the period, we won new assignments from Beiersdorf, L'Oréal, Sainsbury's, TD Bank and Under Armour, among others."

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