WPP revenue up 8% in first four months; Brexit and US rate rise cited as possible risks

9th Jun 2015 12:42

Advertising agency WPP posted an 8% rise in revenue to £3.78bn for the first four months of the year, although the company cautioned that it looks set to be "another demanding year" and pointed to a possible 'Brexit' and US interest-rate hike as risks.Revenue in constant currency was up 7.1%, reflecting the weakness of sterling against the dollar, which was partly offset by sterling's strength against the euro.On a like-for-like basis, excluding the impact of acquisitions and currency fluctuations, revenue was up 5.0% compared with the same period last year and similar to the first quarter of this year.The company said that sales growth in April was marginally softer, as parts of the group's advertising, data investment management and branding & identity businesses were slightly slower, albeit against a very strong comparative last year.Advertising and media investment management, branding and identity, and healthcare and specialist communications continued to be the strongest sectors, and the US and UK showed the strongest growth, said WPP.The company said: "After another record year in 2014, the group's performance in the first four months of the new financial year has been particularly creditable, as worldwide gross domestic product growth, both nominal and real, seems to have slowed in the second half of last year and into the new year."In the statement, WPP said that the UK referendum on European Union membership and the potential impact of an interest-rate hike by the Federal Reserve were possible upcoming risks."Although interest rates are likely to remain lower, longer than many anticipate, due to mediocre growth rates, when the tightening comes, as it inevitably will, it may have a dramatic impact on bond and equity valuations, as recent gyrations in the markets indicate," said WPP.It added: "the somewhat surprising result of the United Kingdom General Election (at least to the pollsters), with the Conservatives winning an overall majority, has resulted in an uncertainty-stimulating European Union referendum."Commenting on the results, Hargreaves Lansdown equity analyst Keith Bowman said: ""In a tough growth environment, WPP continues to benefit from corporate brand investment. Diversified geographical and divisional growth has again been reported, with the UK remaining a particular highlight and some improvement in Western Continental Europe over the final quarter of 2014 being seen."At 15:25, WPP shares were down 1.2% at 1,469p.