WPP expected to cut forecast

WPP is expected to cut its full-year sales forecast for the second time in six months this week.

Sir Martin Sorrell
Sir Martin Sorrell

Analysts expect the Sir Martin Sorrell-led marketing services group, which owns JWT, Mediaedge:cia and Hill & Knowlton, to report sales for the first six months of the year dipped 7.9% to £4.27bn when it reports on Wednesday (24 August).

In April, Sir Martin said he expected a mid-single digit decline for the full-year, revising down his prediction of a 2% dip earlier in the year but expectations are that the group might now fall short of the revised forecast.

The group’s margins, forecast to come out below 10% for the half-year, are expected to be hit by severance costs relating to staff cuts. WPP has cut nearly 7,000 staff in a bid to reduce costs.

WPP is the last of the major marketing groups to report second quarter figures. Interpublic, owner of McCann Erickson and Lowe, reported revenue fell 14.5% in the three months to 30 June, while Publicis Groupe, owner of Starcom and Saatchi & Saatchi, said revenues dipped 6.6%. Omnicom sales dropped 11%.

Shares in WPP rose 4.26% this morning on hopes that the group would be upbeat in its statement.

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