Robust first half at WPP

29th Aug 2013 07:11

Advertising giant WPP revealed a 19 per cent increase in half year pre-tax profit as slowing growth rates among emerging markets were eclipsed by a strong performance among mature markets like North America and the UK.The FTSE 100 listed firm said pre-tax profit jumped 19.4% to £427.1m for the six months ended June 30th 2013 while revenue grew 7.1% to £5.3bn. Like-for-like (LFL) sales rose 2.4% with 3.1% growth from acquisitions and 1.6% from currency, reflecting a weaker pound. It forecast annual revenue growth at 2.8%.Billings were up 5% at £22.7bn while headline diluted earnings per share rose over 10% to 28.4p.Asia Pacific, Latin America, Africa & the Middle East and Central and Eastern Europe, although still showing strong overall growth, slowed in the second quarter, with constant currency revenues up 6.8% in the second quarter and up 5.2% LFL, lower than the first quarter LFL growth of 7.8%. The UK reported revenue of £669m in the first half, up 13.1% and North American sales rose 5.3% to £1.84bn.It said Western Continental Europe remains currently very challenged from a macro-economic point of view. "Overall 2013 started reasonably well with a fair first quarter, a stronger second quarter and July year-to-date like-for-like growth of 2.8%. All geographies and sectors, except public relations and public affairs, grew." "There has been some slowing of revenue growth rates in the faster growing markets of Asia Pacific, Latin America, Africa & the Middle East and Central and Eastern Europe, but this was more than compensated by a significant improvement in the revenue growth rates in the mature markets of North America and the UK in the second quarter," it said in a statement.WPP said the pattern of 2013 looks similar to 2012 and equally demanding, perhaps with slightly increased client confidence. Quarter two has seen significant improvement over the first quarter of the year.It added that 2014 looks a better prospect, however, with the World Cup in Brazil, the Winter Olympics in Sochi and the mid-term US Congressionals.A dividend payment of 10.56p has been offered, up 20%.CJ