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WPP AGM Trading Update | June 26 2002 |
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At the recent AGM of the WPP Group, chairman Martin Sorrell reported on reduced revenues for the first five months of 2002, having dropped by 2 percent. He also described how the operating margin target of 15 percent for the year remains unachievable. Mr Sorrell detailed how the company's trading continues to be difficult with few, if any, signs of recovery in the advertising and marketing services industry. By sector, he noted that advertising and media investment management was flat, information and consultancy up over 6 percent, public relations and public affairs down over 11 percent and branding and identity, healthcare and specialist communications down over 3 percent. The company continues to make small- to medium-sized acquisitions or investments in high growth geographical or functional areas. In the first five months of this year, these have been concentrated geographically in advertising and media investment management in the UK, Sweden, Finland, China and India; in information and consultancy in the USA, Ireland and Thailand; in public relations and public affairs in Australia and Japan; and in branding and identity, healthcare and specialist communications in Norway. WPP's financial strategy continues to be focused on three objectives: increasing operating profit by 10% to 15% per annum; increasing operating margins by 0.5 margin points or more per annum, depending on the level of revenue growth; and reducing staff cost to revenue ratios by 0.3 margin points per annum or more, again depending on the level of revenue growth. Simple printable version of this article. Email this article to a friend.
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