Global marketing giant WPP WPP has announced a 3.8% rise in profits but has revised down its forecasts for 2009, predicting a fall in revenues of 2%.
WPP says 2008 was a year of “two contrasting halves, with first organic revenues growing by 4% in the first six months compared to just over 1% in the second half “as the impact of the sub-prime and insurance monoline crises, that started towards the end of 2007, was intensified by the collapse, emergency acquisition and restructuring of financial institutions in most parts of the world.”
It reported that, despite the positive effects of major global events such as the US presidential elections and the Beijing Olympics, worldwide advertising and marketing expenditures only rose “about 2-3%” in
Overall the group, which owns advertising agencies including JWT and Olgilvy & Mather Worldwide and media agencies Mindshare and MediaCom, and led by Sir Martin Sorrell (pictured), reported like for like revenue grew by 2.7%.
UK like for like revenue rose by 2.2% in 2008 but its North American revenues slumped 0.3%. Spain and Italy were it’s weakest markets out the five Western European regions, although overall continental European revenues increased 2.3%.
Operations in the Asia Pacific, Latin America, Africa & the Middle East grew strongest at 8.4% like for like growth.
However, it says 4th quarter revenues were stronger than expected because FMCG companies “may be maintaining their brand investment spending even in the difficult times.”
WPP’s digital operations and PR and public affairs activities are the fastest growing areas of its business, with the former contributing 25% of the group’s business and the latter contributing 27% on a pro forma basis.
Last month, rival Interpublic Group reported organic revenue growth increased 6.2% in 2008 while Publicis Groupe reported a slight 1% rise in group revenues in 2008.