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Insight Division Slows Up WPP Growth
WPP has reported third quarter revenue of £2.46bn, representing like-for-like growth of 4.7%, but says its insight division grew much slower than any other, revenues rising less than 1%.
Although the Group's growth was slower than in the first two quarters, this reflects the strength of Q3 2010. Gross margin by contrast rose 5.5% in Q3. Stronger growth in the developing markets and a significant improvement in the UK were partially off-set by an anticipated slowing in the USA. Revenues in the BRIC countries were up 19% and in the 'Next 11' economies up almost 15%.
WPP says revenue growth strengthened across all service sectors except consumer insight, 'within which custom research remains the drag, particularly in mature markets'. Consumer insight revenues grew just 0.7%, with gross margin, 'a better measure of performance and cost comparison', up 1.7% - this while advertising and media investment management revenues grew by 12.5%, PR and public affairs by 7.4% and branding and identity, healthcare and specialist communications by 10.5%.
Revenues for the first nine months of the year were up 5.6% on a like-for-like basis, totalling £7.170bn. 29% of the Group's revenues in the period came from Asia Pacific, Latin America, Africa and the Middle East and Central and Eastern Europe, up 1.5 percentage points over the first nine months of 2010. The Group has set a target of 35-40% in the next three to four years. Chasing the same target for digital and interactive revenues, the Group says these accounted for almost 29% of total revenues, up 0.7 percentage points against last year.
The company said 2012 'does not look dire', with expected boosts from the US Presidential election, London Olympics and other major events, but noted grimly that 'the continuous macroeconomic gloom and despair in the media and elsewhere must have some impact on both corporate and consumer confidence.'
Web site: www.wpp.com .
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