Sequential improvement in LFL growth in Q2. Strong progress against
Key figures (£m) |
H1 2024 |
+/(-) %
|
+/(-) %
|
H1 2023 |
||||
|
|
|
|
|
||||
Revenue |
7,227 |
0.1 |
2.6 |
7,221 |
||||
Revenue less pass-through costs |
5,599 |
(3.6) |
(1.0) |
5,811 |
||||
|
|
|
|
|
||||
Reported: |
|
|
|
|
||||
Operating profit |
423 |
38.2 |
|
306 |
||||
Operating profit margin3 |
5.9 % |
1.7 pt |
|
4.2 % |
||||
Diluted EPS (p) |
18.8 |
82.5 |
|
10.3 |
||||
Dividends per share (p) |
15.0 |
0.0 |
|
15.0 |
||||
|
|
|
|
|
||||
Headline4: |
|
|
|
|
||||
Operating profit |
646 |
(3.0) |
0.5 |
666 |
||||
Operating profit margin |
11.5 % |
0.0pt |
0.1pt |
11.5 % |
||||
Diluted EPS (p) |
30.9 |
(6.6) |
|
33.1 |
H1 and Q2 highlights
- H1 reported revenue +0.1%, LFL revenue +2.6%. H1 revenue less pass-through costs -3.6%, LFL revenue less pass-through costs -1.0%
-
Q2 LFL revenue less pass-through costs -0.5%, with
North America +2.0% and Western Continental Europe +0.3%, offset by theUK -5.3% and Rest of World -2.2%, with growth inIndia +9.1% offset by a decline inChina -24.2%
- Global Integrated Agencies Q2 LFL revenue less pass-through costs fell 0.6% with GroupM growing 1.4%, offset by a 2.4% decline at integrated creative agencies
- Top ten clients5 grew 2.5% in H1. CPG, TME6 and automotive client sectors grew well in Q2. Technology client sector stabilising, with a decline of 1.0% LFL in Q2, an improvement from Q1’s -9.0%. Healthcare and retail sectors impacted by 2023 client losses
- Strong progress on strategic initiatives with new products and solutions launched within WPP Open, our AI-powered marketing operating system, and Burson, GroupM and VML on track to deliver targeted savings
-
Agreement to sell WPP’s majority stake in FGS Global to KKR at an enterprise valuation of
$1.7bn , generating total cash proceeds to WPP of c.£604m7 after tax. Proceeds will be used to reduce leverage, implying pro-forma average net debt to EBITDA of c.1.60x8, comfortably within the range of 1.50-1.75x
- H1 headline operating profit £646m. Headline operating margin of 11.5% (H1 2023: 11.5%), up 0.1pt LFL, reflecting disciplined cost management as we continue to invest in our proposition. H1 reported operating profit £423m up 38.2%, reflecting the above factors and lower restructuring costs of £153m (H1 2023: £267m)
-
$1.7bn net new billings9 (H1 2023:$2.0bn ), with Q2 net new billings$0.9bn (Q2 2023:$0.5bn ). New client wins included assignments for AstraZeneca, Colgate-Palmolive, J&J andGovernment of Canada
-
Adjusted net debt as at
30 June 2024 £3.4bn down £0.1bn year-on-year
- Interim dividend of 15.0p declared (2023: 15.0p)
- 2024 guidance updated: LFL revenue less pass-through costs of -1% to 0% (previously 0% to 1%), with improvement in headline operating profit margin of 20-40bps (excluding the impact of FX)
“At our Capital Markets Day earlier this year we set out our strategy to build on and improve the competitiveness of WPP’s offer. I am very pleased with the progress we have made in the past six months against each of our strategic objectives, particularly our continued investment in AI, the creation of VML and Burson, and the simplification of GroupM. We are strengthening our offer for clients while building a more efficient company.
“Our second quarter performance delivered sequential improvement in net sales10 with continued growth in GroupM, Ogilvy and Hogarth and sequential improvement at Burson, VML and our Specialist Agencies. Importantly, we also saw
“The sale of our stake in FGS Global is an excellent outcome less than four years after its creation from three separate businesses within WPP. It will allow us to focus and invest in our core creative transformation offer while significantly strengthening our financial position.
“As a team, our priority continues to be improving our competitiveness by delivering a modern, global, creative and integrated offer for our clients. The steps we have taken since January to integrate our offer, bring in new talent and invest in AI represent strong progress towards delivering on our medium-term financial targets and to shareholders.”
This announcement contains information that qualifies or may qualify as inside information. The person responsible for arranging the release of this announcement on behalf of
To access WPP's 2024 interim results financial tables, please visit: www.wpp.com/investors
Strategic progress
At our Capital Markets Day in
Lead through AI, data and technology
It’s clear that AI is going to fundamentally change the way in which our clients reach consumers, the way in which we deliver and produce work and the way in which we operate as a company. While it is undoubtedly early days in the application of AI to marketing, we can see enough already to know that its impact will be significant.
At our Capital Markets Day, we laid out our plans to embrace AI and invest in the technology and data that is required. WPP Open, our intelligent marketing operating system powered by AI, is a critical component of our strategy, enabling us to use AI in how we work. But it is also important to understand that this is only one part of our strategy. We also need to train and upskill our teams, engage with our clients and create new, AI-driven experiences.
We have continued to invest in WPP Open as part of our annual investment of £250m in AI-driven technology. We have developed new functionality and integrated new AI models and as a result, have seen growing adoption and usage across WPP and by our clients.
Since the start of the year, we are seeing monthly active users up 74%, LLM usage up 177% and image generation up 241%. We are also seeing growing adoption by clients, with key clients using the platform including
Functionality and Model Integration
WPP Open is a single marketing operating system that powers all of WPP’s businesses. The core Studios – Creative, Production, Media, Experience, Commerce and PR – are designed to support key functional areas with AI-powered applications in a way that allows for integrated ways of working across the company.
WPP Open’s
WPP Open’s
We launched our upgraded Performance Brain™ at
We also announced the integration into
In June, we launched
In July, at SIGGRAPH, the annual computer graphics conference, we unveiled the next phase of our partnership with NVIDIA – using new NVIDIA NIM microservices and Shutterstock’s 3D asset library to create brand-compliant generative 3D landscapes and worlds. The Coca-Cola Company will be one of the first of WPP’s clients to begin scaling the opportunities of generative 3D across its 100 markets. WPP has also been working with
Our Work with Clients
Not only is AI enabling us to innovate in how we work with clients and to produce work in new ways, it’s also allowing us to develop new ground-breaking consumer experiences for our clients. We continue to lead the way in demonstrating the power of the technology to build more relevant and personalised experiences for our clients.
Some examples include:
- Mars’ Snickers Own Goal from T&Pm : Powered by AI technology from ElevenLabs, Synclabs and Open AI, this application uses a personalised AI José Mourinho to humorously coach fans out of their “own goals”. By generating custom video responses for fans' mistakes, this campaign leverages AI to create unique, shareable content and engage fans in a new, interactive way. The application is integrated with WhatsApp for social sharing and co-created with agency Helo.
- Coke SoundZ for The Coca-Cola Company by WPP Open X, led by AKQA : An AI-powered instrument creating uplifting tunes from Coca-Cola's iconic sounds. This innovative auditory branding engages consumers through sound psychology, featuring both digital and physical versions. Collaborations with artists like Marshmello have amplified its impact, reinforcing Coca-Cola's leadership in innovative marketing and delivering more than 500 million impressions globally.
-
Mondelēz’s Bournvita D For Dreams by Ogilvy and Wavemaker
: Uses advanced AI technology to offer children personalised cricket training from legend
Rahul Dravid . The AI tool tracks kids' time spent in the sun, translating it into virtual coaching sessions, and so promoting Vitamin D intake. The campaign combines AI-driven interactive experiences with the nutritional benefits of Bournvita, encouraging outdoor activity and health awareness.
Accelerate growth through the power of creative transformation
Creativity is what sets WPP apart, and when combined with AI, technology, data and the largest global media platform, we have an unparalleled integrated offer to clients.
That offer is resonating well, as reflected in growth across our largest clients. The first half of the year saw expansion in scope for many top clients, with wins including media assignments for Nestlé and Colgate-Palmolive’s decision to name WPP as its Amazon agency of record for
We continue to win industry recognition for our creative excellence. In June, the Cannes Lions International Festival of Creativity named WPP as ‘Creative Company of the Year’ for 2024, with Ogilvy taking home ‘Creative Network of the Year’. WPP agencies collected a total of 160 Lions, including a Titanium, 6
The Coca-Cola Company, whose global marketing partner is WPP Open X, was named ‘Creative Brand of the Year’ for the first time in its history. This follows the announcement in May that Unilever, one of WPP’s largest clients, was named ‘Creative Marketer of the Year’ for 2024, thanks in part to work from WPP agencies on its brands.
WPP's media agencies EssenceMediacom, Mindshare and Wavemaker also made a very strong showing at the festival, with GroupM ending the week as the industry’s leading media group with 90 Lions, up from 59 last year.
In addition, WPP's agencies won the most awards at this year’s
Build world-class, market-leading brands
We have made excellent progress towards building stronger world-class brands.
VML launched in
The new Burson agency launched in June, with the new leadership team in place globally and in most markets around the world. As a further simplification of our offer,
The GroupM simplification initiative also progressed well in the first half. We made good progress on the structural cost actions, with GroupM operating as one entity in markets around the world. As part of this, we have launched
In July, WPP announced the appointment of
In the final COMvergence report for 2023, GroupM remained the largest media planning and buying agency by some distance with leading positions in key global markets such as
GroupM continues to invest in retail media initiatives around the world, and of particular note is its partnership with Tesco to create a Media and Insight Platform, powered by dunnhumby, to deliver best-in-class delivery of data-led solutions, education and innovation across all areas of retail media in the
We have a strong pipeline of new business in media, and while our new business performance at GroupM in
Execute efficiently to drive financial returns through margin and cash
As well as the structural cost savings relating to the initiatives above, we are making good progress in our back-office efficiency programme across enterprise IT, finance, procurement and real estate.
In enterprise IT, we successfully rolled out Maconomy in certain markets in EMEA and
Across IT and Finance, we continue to optimise our finance shared service centres, including migrating teams from VML in
Our category-led procurement model continues to consolidate spend by sub-category to drive further savings. We are digitalising our source-to-contract processes, enabling further automation as we consolidate our ERP landscape.
In real estate, our ongoing campus programme and consolidation of leases continues to deliver benefits. Several new campus openings are planned for the second half of 2024, including WPP’s third
We have also opened a new operations and delivery hub in
Purpose and ESG
WPP’s purpose is to use the power of creativity to build better futures for our people, planet, clients and communities. Read more on the ways WPP is working to deliver against its purpose in our 2023 Sustainability Report.
First half overview
Revenue was £7.2bn, up 0.1% from £7.2bn in H1 2023, and up 2.6% like-for-like. Revenue less pass-through costs was £5.6bn, down 3.6% from £5.8bn in H1 2023, and down 1.0% like-for-like.
|
Q2 2024
|
%
|
%
|
%
|
%
|
|||||
Revenue |
3,815 |
1.4 |
0.3 |
(2.0) |
3.1 |
|||||
Revenue less pass-through costs |
2,912 |
(2.3) |
0.1 |
(1.9) |
(0.5) |
|||||
|
H1 2024
|
%
|
%
|
%
|
%
|
|||||
Revenue |
7,227 |
0.1 |
0.5 |
(3.0) |
2.6 |
|||||
Revenue less pass-through costs |
5,599 |
(3.6) |
0.3 |
(2.9) |
(1.0) |
|||||
Segmental review
Business segments - revenue less pass-through costs
% LFL +/(-) |
Global
|
Public Relations |
Specialist Agencies |
|||
Q2 2024 |
(0.6) |
1.5 |
(2.0) |
|||
H1 2024 |
(0.7) |
(0.9) |
(4.7) |
Global Integrated Agencies : GroupM, our media planning and buying business, grew 1.9% in H1 (Q2: +1.4%), offset by a 2.8% decline at other Global Integrated Agencies (Q2: -2.4%).
GroupM growth continues to be impacted by 2023 client assignment losses, which have been partially offset by wins including Nestlé. Q2 growth of 1.4% slowed sequentially from 2.4% in Q1 as an acceleration to mid-single digit growth in the US was more than offset by weaker second quarter trends in
Ogilvy’s performance benefited from recent new business wins, including Verizon, good growth in CPG clients and stabilisation of spending by technology clients in Q2. Hogarth grew well, benefiting from new business wins and growing demand for its technology and AI-driven capabilities, as clients seek to produce more personalised and addressable content. VML continued to be impacted by the loss of Pfizer creative assignments, but saw sequential improvement in Q2, benefiting from recent new business wins and stabilisation of spending by technology clients. AKQA was impacted by delays in project-related spend.
Public Relations : FGS Global continued to grow strongly in H1 2024, offset by declines at Burson due to the loss of Pfizer assignments and the impact of macroeconomic uncertainty on some areas of client spending.
Specialist Agencies
:
Regional segments - revenue less pass-through costs
% LFL +/(-) |
|
|
Western Continental
|
Rest of World |
||||
Q2 2024 |
2.0 |
(5.3) |
0.3 |
(2.2) |
||||
H1 2024 |
(1.6) |
(2.6) |
1.7 |
(1.4) |
In Western Continental Europe,
The Rest of World declined in H1 2024 as good growth in
We appointed a new President of WPP China in February who is working closely with the local CEOs of each of our agencies, including the new senior leadership team at GroupM, to bring together the best of our talent and capabilities in
Top five markets - revenue less pass-through costs
% LFL +/(-) |
|
|
|
|
|
|||||
Q2 2024 |
2.6 |
(5.3) |
(7.4) |
(24.2) |
9.1 |
|||||
H1 2024 |
(1.4) |
(2.6) |
(4.8) |
(20.3) |
8.1 |
|||||
Client sector review - revenue less pass-through costs
|
Q2 2024 |
H1 2024 |
H1 2024 |
|||
|
% LFL +/(-) |
% LFL +/(-) |
% share, revenue
|
|||
CPG |
5.1 |
7.2 |
28.3 |
|||
Tech & Digital Services |
(1.0) |
(5.1) |
17.2 |
|||
Healthcare & Pharma |
(9.7) |
(9.0) |
11.4 |
|||
Automotive |
3.6 |
1.5 |
10.4 |
|||
Retail |
(10.7) |
(9.9) |
8.8 |
|||
Telecom, |
5.1 |
5.9 |
6.8 |
|||
Financial Services |
1.9 |
0.5 |
6.2 |
|||
Other |
(15.7) |
(15.3) |
4.8 |
|||
Travel & Leisure |
1.9 |
3.0 |
3.7 |
|||
Government, Public Sector & Non-profit |
(7.6) |
(7.2) |
2.4 |
Financial results
Unaudited headline income statement12:
£ million |
H1 2024 |
H1 2023 |
+/(-) % reported |
+/(-) % LFL |
||||
|
|
|
|
|
||||
Revenue |
7,227 |
7,221 |
0.1 |
2.6 |
||||
Revenue less pass-through costs |
5,599 |
5,811 |
(3.6) |
(1.0) |
||||
Operating profit |
646 |
666 |
(3.0) |
0.5 |
||||
Operating profit margin % |
11.5% |
11.5 % |
– |
0.1pt* |
||||
Income from associates |
15 |
8 |
87.5 |
|
||||
PBIT |
661 |
674 |
(1.9) |
|
||||
Net finance costs |
(136) |
(128) |
(6.3) |
|
||||
Profit before taxation |
525 |
546 |
(3.8) |
|
||||
Tax |
(146) |
(148) |
1.4 |
|
||||
Profit after taxation |
379 |
398 |
(4.8) |
|
||||
Non-controlling interests |
(41) |
(37) |
(10.8) |
|
||||
Profit attributable to shareholders |
338 |
361 |
(6.4) |
|
||||
Diluted EPS |
30.9p |
33.1p |
(6.6) |
|
||||
|
|
|
|
|
||||
Reported: |
|
|
|
|
||||
Revenue |
7,227 |
7,221 |
0.1 |
|
||||
Operating profit |
423 |
306 |
38.2 |
|
||||
Profit before taxation |
338 |
204 |
65.7 |
|
||||
Diluted EPS |
18.8p |
10.3p |
82.5 |
|
||||
*margin points |
||||||||
Operating profit
Headline operating profit was £646m (H1 2023: £666m), at a headline operating profit margin of 11.5% (H1 2023: 11.5%), 0.1 points higher than the prior period on a constant currency basis. This reflects the decline in revenue less pass-through costs, cost inflation and investment for future growth, partially offset by continued cost discipline and restructuring initiatives.
Total headline operating costs were down 3.7%, to £4,953m (H1 2023: £5,145m). Staff costs (excluding incentives) of £3,837m were down 3.3% compared to the prior period (H1 2023: £3,969m), reflecting higher wage inflation offset by lower headcount as a result of the actions we have taken to mitigate the top-line decline in H1 and our restructuring initiatives. Incentives of £148m were down 14.0% compared to the prior period (H1 2023: £172m) due to phasing relating to the weighting of business performance through the year against annual incentive targets.
Establishment costs of £242m were down 11.1% compared to the prior period (H1 2023: £272m) driven by benefits from the campus programme and consolidation of leases. IT costs of £341m were down 2.6%, personal costs of £103m were down 8.0% driven by savings in travel and entertainment, and other operating expenses of £282m were up 4.4% driven by higher commercial costs.
On a like-for-like basis, the average number of people in the Group in the first half was 113,000 compared to 115,000 in the first half of 2023. The total number of people as at
Headline EBITDA (including IFRS 16 depreciation) for the period was down 1.4% to £756m (H1 2023: £767m).
Reported operating profit was £423m (H1 2023: £306m) at a reported operating profit margin of 5.9% (H1 2023: 4.2%). Reported operating profit includes restructuring costs of £153m (H1 2023: £267m), amortisation and impairment of acquired intangible assets and impairment of investments in associates of £80m (H1 2023: £100m, including £53m of goodwill impairment).
The restructuring and transformation costs (£153m) relate to actions set out at the January Capital Markets Day, primarily the structural cost saving plan relating to the creation of VML and Burson and the simplification of GroupM (£72m). These structural savings are to deliver annualised net cost savings of c.£125m in 2025, with more than 50% of that saving now expected to be achieved in 2024 (ahead of the original plan of 40-50%) and an associated restructuring cost of c.£125m in 2024. Also included within restructuring and transformation costs are the Group’s IT transformation projects (£47m) and property costs associated with impairments prior to 2024 (£22m).
Net finance costs
Headline net finance costs of £136m were up 6.3% compared to the prior period (H1 2023: £128m), primarily due to the impact of refinancing bonds at higher rates.
Reported net finance costs were £101m (H1 2023: £103m), including net income of £35m (H1 2023: net income £25m) relating to the revaluation and retranslation of financial instruments.
Tax
The headline effective tax rate (based on headline profit before tax) was 28.0% (H1 2023: 27.0%). The increase in the headline effective tax rate is driven by changes in tax rates or tax bases in the markets in which we operate. Given the Group’s geographic mix of profits and the changing international tax environment, the tax rate is expected to increase over the next few years.
The reported effective tax rate was 27.2% (H1 2023: 26.9%). The reported effective tax rate is lower than the headline effective tax rate due to gains on disposal of investments and subsidiaries not being taxable.
Earnings per share (“EPS”) and dividend
Headline diluted EPS was 30.9p (H1 2023: 33.1p), a decrease of 6.6% due to lower headline operating profit (which includes an adverse FX impact which reduced headline diluted EPS by
Reported diluted EPS was 18.8p (H1 2023: 10.3p), an increase of 82.5% due to higher reported operating profit.
For 2024, the Board is declaring an interim dividend of 15.0p (2023: 15.0p). The record date for the interim dividend is
Cash flow13
Six months ended (£ million) |
|
|
||
Headline operating profit |
646 |
666 |
||
Income from associates |
15 |
8 |
||
Depreciation of property, plant and equipment |
81 |
84 |
||
Amortisation of other intangibles |
14 |
9 |
||
Depreciation of right-of-use assets |
110 |
129 |
||
Headline EBITDA |
866 |
896 |
||
Less: income from associates |
(15) |
(8) |
||
Repayment of lease liabilities and related interest |
(187) |
(184) |
||
Non-cash compensation |
56 |
76 |
||
Non-headline cash costs (including restructuring cost) |
(144) |
(114) |
||
Capex |
(107) |
(104) |
||
Working capital |
(1,056) |
(1,044) |
||
Adjusted operating cash flow |
(587) |
(482) |
||
% conversion of Headline operating profit |
(91)% |
(72)% |
||
Dividends (to minorities)/ from associates |
(16) |
(42) |
||
Earnout payments |
(25) |
(12) |
||
Net interest |
(49) |
(48) |
||
Cash tax |
(168) |
(171) |
||
Adjusted free cash flow |
(845) |
(755) |
||
Disposal proceeds |
33 |
14 |
||
Net initial acquisition payments |
(29) |
(203) |
||
Dividends |
— |
— |
||
Share purchases |
(57) |
(37) |
||
Adjusted net cash flow |
(898) |
(981) |
Adjusted operating cash outflow was £587m (H1 2023: £482m). The main driver of the larger cash outflow year on year was an increase in non headline cash costs to £144m (H1 2023: £114m), mainly driven by costs related to the previously announced restructuring plan, including the creation of VML and Burson and the simplification of GroupM. The working capital outflow was £1,056m, in line with the prior period (H1 2023: £1,044m) and reflects the usual seasonality of client activity and timing of payments. Reported net cash outflow from operating activities (see Note 6) increased to £540m (H1 2023: £445m outflow).
Adjusted free cash outflow was £845m, higher than prior period (H1 2023: £755m) due to higher adjusted operating cash outflow and higher earnout payments, offset by lower dividends to minorities. Adjusted net cash outflow of £898m was lower than the prior period (H1 2023: £981m) due to lower net acquisition payments.
A summary of the Group’s unaudited cash flow statement and notes for the six months to
Balance sheet
As at
Non-current assets of £12,438m decreased by £241m (
Current assets of £13,375m decreased by £569m (
Current liabilities of £14,988m decreased by £1,317m (
The decrease in both trade and other receivables and trade and other payables is primarily due to the seasonality of client activity and timing of payments, with the relative movement from December consistent with prior years.
Non-current liabilities of £6,867m (
Recognised within total equity, other comprehensive loss of £62m (H1 2023: £210m) for the period includes a £37m loss (H1 2023: £285m) for foreign exchange differences on translation of foreign operations, and an £18m loss (H1 2023: gain of £78m) on the Group’s net investment hedges.
A summary of the Group’s unaudited balance sheet and selected notes as at
Adjusted net debt
As at
As at
The average adjusted net debt to headline EBITDA ratio in the 12 months ended
In
In
Our bond portfolio as at
Outlook
Our guidance for 2024 is as follows:
Like-for-like revenue less pass-through costs growth of -1% to 0% (previously 0-1%)
|
Other 2024 financial indications:
- Mergers and acquisitions will add <0.5% to revenue less pass-through costs growth (previously 0.5-1.0%)
-
FX impact: current rates (at
2 August 2024 ) imply a c.2.8% drag on FY 2024 revenues less pass-through costs, with a 0.1pt drag expected on FY 2024 headline operating margin - Headline income from associates and non-controlling interests at similar levels to 2023
- Net finance costs of around £295m
- Effective tax rate (measured as headline tax as a % of headline profit before tax) of around 28%
- Capex of around £260m
- Cash restructuring costs of around £285m
- Working capital expected to be broadly flat year-on-year
Medium-term targets
In
- 3%+ LFL growth in revenue less pass-through costs
- 16-17% headline operating profit margin
- Adjusted operating cash flow conversion of 85%+14
Business sector and regional analysis
Business sector15
Revenue analysis
|
Q2 |
|
H1 |
|||||||||
|
£m |
+/(-)
|
+/(-) % LFL |
|
£m |
+/(-)
|
+/(-) % LFL |
|||||
Global Int. Agencies |
3,238 |
1.5 |
3.3 |
|
6,117 |
0.6 |
3.2 |
|||||
Public Relations |
311 |
(0.1) |
1.1 |
|
601 |
(2.8) |
(0.9) |
|||||
Specialist Agencies |
266 |
1.9 |
3.0 |
|
509 |
(2.3) |
(0.5) |
|||||
|
3,815 |
1.4 |
3.1 |
|
7,227 |
0.1 |
2.6 |
|||||
Revenue less pass-through costs analysis
|
Q2 |
|
H1 |
|||||||||
|
£m |
+/(-)
|
+/(-) % LFL |
|
£m |
+/(-)
|
+/(-) % LFL |
|||||
Global Int. Agencies |
2,392 |
(2.6) |
(0.6) |
|
4,595 |
(3.5) |
(0.7) |
|||||
Public Relations |
293 |
0.1 |
1.5 |
|
568 |
(2.7) |
(0.9) |
|||||
Specialist Agencies |
227 |
(3.2) |
(2.0) |
|
436 |
(6.6) |
(4.7) |
|||||
|
2,912 |
(2.3) |
(0.5) |
|
5,599 |
(3.6) |
(1.0) |
|||||
Headline operating profit analysis
£ million |
H1 2024 |
% margin* |
H1 2023 |
% margin* |
||||
Global Int. Agencies |
551 |
12.0 |
550 |
11.6 |
||||
Public Relations |
80 |
14.1 |
88 |
15.1 |
||||
Specialist Agencies |
15 |
3.4 |
28 |
6.0 |
||||
|
646 |
11.5 |
666 |
11.5 |
||||
* Headline operating profit as a percentage of revenue less pass-through costs |
||||||||
Regional
Revenue analysis
|
Q2 |
|
H1 |
|||||||||
|
£m |
+/(-)
|
+/(-) %
|
|
£m |
+/(-)
|
+/(-) %
|
|||||
|
1,467 |
6.5 |
6.2 |
|
2,781 |
1.3 |
2.5 |
|||||
|
544 |
(4.1) |
(4.4) |
|
1,058 |
(0.7) |
(1.2) |
|||||
W Cont. |
762 |
(2.4) |
0.1 |
|
1,458 |
(1.3) |
1.9 |
|||||
AP, LA, AME, CEE16 |
1,042 |
0.5 |
5.1 |
|
1,930 |
(0.3) |
5.5 |
|||||
|
3,815 |
1.4 |
3.1 |
|
7,227 |
0.1 |
2.6 |
|||||
Revenue less pass-through costs analysis
|
Q2 |
|
H1 |
|||||||||
|
£m |
+/(-)
|
+/(-) %
|
|
£m |
+/(-)
|
+/(-) %
|
|||||
|
1,152 |
1.5 |
2.0 |
|
2,207 |
(3.4) |
(1.6) |
|||||
|
396 |
(5.4) |
(5.3) |
|
779 |
(2.1) |
(2.6) |
|||||
W Cont. |
608 |
(2.1) |
0.3 |
|
1,164 |
(1.3) |
1.7 |
|||||
AP, LA, AME, CEE |
756 |
(6.3) |
(2.2) |
|
1,449 |
(6.6) |
(1.4) |
|||||
|
2,912 |
(2.3) |
(0.5) |
|
5,599 |
(3.6) |
(1.0) |
|||||
Headline operating profit analysis
£ million |
H1 2024 |
% margin* |
H1 2023 |
% margin* |
||||
|
336 |
15.2 |
287 |
12.6 |
||||
|
78 |
10.0 |
98 |
12.3 |
||||
W Cont. |
117 |
10.1 |
111 |
9.4 |
||||
AP, LA, AME, CEE |
115 |
7.9 |
170 |
11.0 |
||||
|
646 |
11.5 |
666 |
11.5 |
||||
* Headline operating profit as a percentage of revenue less pass-through costs |
||||||||
Cautionary statement regarding forward-looking statements
This document contains statements that are, or may be deemed to be, “forward-looking statements”. Forward-looking statements give the Company’s current expectations or forecasts of future events.
These forward-looking statements may include, among other things, plans, objectives, beliefs, intentions, strategies, projections and anticipated future economic performance based on assumptions and the like that are subject to risks and uncertainties. These statements can be identified by the fact that they do not relate strictly to historical or current facts. They use words such as ‘aim’, ‘anticipate’, ‘believe’, ‘estimate’, ‘expect’, ‘forecast’, ‘guidance’, ‘intend’, ‘may’, ‘will’, ‘should’, ‘potential’, ‘possible’, ‘predict’, ‘project’, ‘plan’, ‘target’, and other words and similar references to future periods but are not the exclusive means of identifying such statements. As such, all forward-looking statements involve risk and uncertainty because they relate to future events and circumstances that are beyond the control of the Company. Actual results or outcomes may differ materially from those discussed or implied in the forward-looking statements. Therefore, you should not rely on such forward-looking statements, which speak only as of the date they are made, as a prediction of actual results or otherwise. Important factors which may cause actual results to differ include but are not limited to: the impact of epidemics or pandemics including restrictions on businesses, social activities and travel; the unanticipated loss of a material client or key personnel; delays or reductions in client advertising budgets; shifts in industry rates of compensation; regulatory compliance costs or litigation; changes in competitive factors in the industries in which we operate and demand for our products and services; changes in client advertising, marketing and corporate communications requirements; our inability to realise the future anticipated benefits of acquisitions; failure to realise our assumptions regarding goodwill and indefinite lived intangible assets; natural disasters or acts of terrorism; the Company’s ability to attract new clients; the economic and geopolitical impact of the conflicts in
Other than in accordance with its legal or regulatory obligations (including under the Market Abuse Regulation, the
Any forward looking statements made by or on behalf of the Group speak only as of the date they are made and are based upon the knowledge and information available to the Directors at the time.
__________________ | ||
1 |
Percentage change in reported sterling. |
|
2 |
Like-for-like. LFL comparisons are calculated as follows: current year, constant currency actual results (which include acquisitions from the relevant date of completion) are compared with prior year, constant currency actual results from continuing operations, adjusted to include the results of acquisitions and disposals for the commensurate period in the prior year. |
|
3 |
Reported operating profit divided by revenue (including pass-through costs). |
|
4 |
In this press release not all of the figures and ratios used are readily available from the unaudited interim results included in Appendix 1. Management believes these non-GAAP measures, including constant currency and like-for-like growth, revenue less pass-through costs and headline profit measures, are both useful and necessary to better understand the Group’s results. Details of how these have been arrived at are shown in Appendix 4. |
|
5 |
Top 10 clients by revenue less pass-through costs in H1 2023. Growth rate includes the impact of a client loss in the healthcare sector. |
|
6 |
Telecommunications, Media and Entertainment. |
|
7 |
Comprising £557m consideration (after tax) for WPP’s c.50% stake as well as a net £47m inflow for the repayment of a loan from WPP to FGS, less FGS’s cash on balance sheet. |
|
8 |
Pro-forma average adjusted net debt to headline EBITDA (last 12 months) (including depreciation of right-of-use assets) of c.1.60x, versus WPP’s average adjusted net debt to headline EBITDA (last 12 months) (including depreciation of right-of-use assets) of c.1.84x at |
|
9 |
As defined in the glossary on page 45. |
|
10 |
“Net sales” refers to revenues less pass-through costs. |
|
11 |
Proportion of WPP revenue less pass-through costs in H1 2024; table made up of clients representing 78% of WPP total revenue less pass-through costs. |
|
12 |
Non-GAAP measures in this table are reconciled in Appendix 4. |
|
13 |
Non-GAAP measures in this table are reconciled in Appendix 4. |
|
14 |
Adjusted operating cash flow divided by headline operating profit. |
|
15 |
Prior year figures have been re-presented to reflect the reallocation of a number of businesses between Global Integrated Agencies and Specialist Agencies. The impact of the re-presentation is not material. |
|
16 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240806766388/en/
Media
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+44 20 7466 5000
press@wpp.com
Investors and analysts
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Source: WPP