WPP profits up 37%; digital advertising hits £1.27bn
WPP has reported profits of £334m, while digital advertising has reached £1.27bn for the first six months of 2011.
The media conglomerate, which owns agencies including media planning and buying operation GroupM and advertising agencies Ogilvy and Grey, said that pre-tax profits were up over 37% year-on-year to £334m.
Revenue was up 6% on the previous year to £4.7bn, while billings were also up more than 5% at £21.4bn.
In the first six months, direct and digitally-related activities accounted for 28.1% of the group’s total revenues, or $2.1bn (£1.27bn) per annum. The target is to make this up to 40% of total group revenue within four years.
Quantitative disciplines, including digital and consumer insight, now account for 47% of group revenues.
Across the group’s communications services sector, WPP reported a “slight up-tick” in growth in branding and identity, healthcare and specialist communications, including digital and interactive, with like-for-like growth of almost 8% in the second quarter.
Consumer insight revenues were up 2.6%, a reduction from the first quarter, with slower growth in the US, the UK and Japan in April and May, with a partial recovery in June. Consumer insight revenues in Latin America showed particularly strong growth in the second quarter, followed by Asia Pacific and Africa.
Concerns around a “Euro contagion” and a US slowdown, however, has prompted caution across WPP, with the group reigning in its full year forecast.
In March, WPP presented a more upbeat view of the future for the advertising and marketing services industry after posting its fastest quarterly revenue growth in more than a decade. The marketing services company said revenue grew 8.5% in the last three months of 2010, the fastest growth rate since Q4 2000. December saw the first monthly double-digit growth rate since January 2001.
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