Healthy Numbers for WPP but DIM Sums Disappoint

WPP has reported total 2015 revenue up 5.3% on a like-for-like basis, with headline EBITDA of £2.002bn, up 7.7% at constant currency. Revenue in pounds was up 6.1% to £12.235 bn. The insight-focused 'data investment management' division (DIM) remained flat for the year, although slightly improved in Q4.

The results show the Kantar division continuing to lag the group's other three units, Media Investment Management, PR and Public Affairs, and 'Branding and Identity, Healthcare and Specialist Communications'. Last year, Group like-for-like revenue was up 8.2% but the figure for DIM was just 0.6%. This year, DIM revenue was down 0.2% on a like-for-like basis, although by the Group's preferred measurement, Net Sales, the division rose a fraction (up 0.3%). In the fourth quarter, DIM's like-for-like revenue rose 1.4% and net sales rose 0.8%. Annual reported revenue for the division was £2.426bn, level with last year and now representing 21.1% of the Group total.

Looking more closely at the sector, the Group says syndicated research 'continues to show resilience', with like-for-like net sales growth up well over 2%, but custom research - just under half of DIM's net sales - fell by a similar amount. Kantar Worldpanel, Kantar Health, Kantar Retail and IMRB all showed 'strong like-for-like net sales growth', with TNS, Millward Brown and Lightspeed 'more challenged'.

Group net sales were £10.524bn, up 3.3% like-for-like, while its headline EBITDA rose from £1.910bn to more than £2bn for the first time. Like-for-like revenue growth was seen in all regions, led by strong growth (7.1%) in North America and with all other regions between 4 and 5%.

WPP says its dual focus in 2016 was to continue revenue growth from a leading position in horizontality, faster growing geographic markets and digital fields, including through strategic acquisitions; and continue emphasis on balancing this with headcount increases and improvement in its staff costs/net sales ratio to enhance operating margins. Average Group headcount in 2015 declined - on a like-for-like basis - by around 1.9% to 124,930, excluding associates.

The Group's home page is at www.wpp.com .