LONDON (dpa-AFX) - Advertising firm WPP Plc (WPP.L, WPPGY) on Wednesday said the year 2012 has started well as its profits and revenues for the first four months of fiscal 2012 increased with continuing improvement across all sectors and geographies, mainly faster growing markets.
In a statement made at the 40th Annual General Meeting held in Dublin today, WPP's Chairman said 'the pattern seen in 2011, with slower growth in the mature markets of the United States and Western Continental Europe, has mostly continued, with the faster growing markets of Asia Pacific, Latin America, Africa and the Middle East and Central and Eastern Europe continuing to be the strongest, as seen in the first quarter.'
As announced earlier, the company expects revenues in the balance of the year to grow slightly better than budget, with full year like-for-like revenue growth of over 4 percent and a slightly stronger second half.
In its statement, WPP said its reported revenues for the four months increased 7 percent to 3.23 billion pounds. Revenues in constant currency were up 7.4 percent, reflecting the slight weakness of sterling against the US dollar more than offset by its strength against the Euro, the company noted.
Revenues increased almost 5 percent in dollar terms and almost 11 percent in euro terms. On a like-for-like basis, excluding the impact of acquisitions and currency fluctuations, revenues were up 4 percent.
The company also said its operating profit was above budget and ahead of last year and margin was in line with full year margin target of 0.5 margin points improvement.
In constant currencies, advertising and media investment management was the strongest performing sector.
'For the remainder of 2012, the focus remains on growing revenues and gross margin faster than the industry average... At the same time, we will concentrate on meeting our operating margin objective by managing absolute levels of costs and increasing our cost flexibility,' the company noted.
According to the company, the three maxi-quadrennial events of 2012 - EURO Football Championships, Olympics and the US Presidential Elections - should underpin industry growth, despite continuing concerns over the Eurozone, Iran and the Middle-East tensions as well as faster growing markets' growth rates.
Looking further ahead, the company projects 2013 to be more challenging as there will be no quadrennial events in that year, while 2014 looks a better prospect, with the World Cup in Brazil, the Winter Olympics in Sochi and the mid-term Congressional elections in America.
In a morning statement, WPP said its operating company JWT Singapore has agreed to acquire a majority stake in India-based Hungama Digital Services Private Limited, the marketing division of Hungama Digital Entertainment Private Limited. Based in Mumbai, Hungama Digital Services employs 110 people.
WPP said its latest investment continues its strategy of developing networks in fast-growing and important markets and sectors.
Today's AGM will probably vote on WPP's founder and Chief Executive Officer Martin Sorrell's proposed 60 percent pay rise. As per reports, shareholder advisory body Pirc has urged the members to vote against the deal, citing concerns over 'excessiveness'.
In London, WPP shares are currently trading at 760 pence, down 8 pence or 1.04 percent.
Copyright RTT News/dpa-AFX