WPP posts 6.7% drop in lfl sales

2nd Jun 2009 12:46

Advertising giant WPP said like-for-like sales in the first four month of the year dropped 6.7% after trading worsened in April.On a reportable basis, worldwide revenues were up 33.7%. In constant currencies, revenues rose 10.3%, principally reflecting the weakness of the pound sterling against the US dollar and Euro. Profit before tax, mainly as a result of the first-time amortisation of intangible assets in relation to the acquisition of Taylor Nelson Sofres, higher interest charges and incremental severance costs, was down 'significantly' on the previous year, the group said.WPP added that comparable first-quarter revenue is likely to show a mid-single digit decline.As a result, the group is reducing headcount and associated staff costs, in line with the forecast revenue decline. In the first four months of 2009 the number of staff fell by almost 4,300 or 3.7%. "The pattern of trading continues to be similarly difficult to the first quarter, although April was worse," said the group."The economic pressure was most keenly felt in the United States and this has spread to the United Kingdom and Continental Europe, although Eastern Continental Europe still shows revenue growth for the first four months of 2009."For the remainder of 2009 the short-term focus will continue to be on balancing staff costs and headcount, against the fall in revenues. WPP shareholders will vote a £60m bonus scheme for chief executive Martin Sorrell later today.