WPP posts 28.5% profit bump

WPP has presented an upbeat view of the future for the advertising and marketing services industry after posting the fastest quarterly revenue growth in a decade.

Sir Martin Sorrell
Sir Martin Sorrell

The marketing services company says revenue grew 8.5% in the last three months of 2010, the fastest growth rate it has posted since the fourth quarter of 2000. December, the company adds, saw the first monthly double-digit growth rate since January 2001.

The strong final quarter helped the Sir Martin Sorrell-led company grow full-year revenue by 7.4% to £9.3bn. Pre-tax profit for 2010 increased 28.5% to £851.3m.

Growth was driven by a “surprising” performance in mature markets such as the US and the UK, where revenue increased by 7.6% and 5.9% respectively.

The company, which owns the Ogilvy, Grey and GroupM agency networks, says that an analysis of marketing and advertising budgets indicate like-for-like revenue growth continuing at about 5% in 2011.

In a statement, the company says that the “long-term outlook for the advertising and marketing services industry appears favourable”.

“…The developments in new technologies and media, the growth in importance of internal communications, the need to influence retail distribution, the growth in government spending and the new focus on corporate responsibility issues such as climate change, underpin the need for our clients to continue to differentiate their products and services both tangibly and intangibly,” it adds.

Advertising and media revenue, which accounts for 39.9% of the group’s earnings, increased 7.1% last year.

Consumer insight, which includes market research firm TNS, grew revenue by 3.9%. PR income rose 3.7%.

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