Strong WPP Results To Boost Advertising Industry
WPP chief executive Sir Martin Sorrell looks set to dismiss concerns of a slowdown in the advertising recovery this week when he reveals a rise in third quarter revenues at the company.
Industry analysts expect WPP to report revenues of £1.05 billion for the three months to September, up 2% on the same period the previous year and representing the first time that the company has broken through the billion pound barrier in a single quarter.
A report in the Observer suggests that Tuesday’s figures will show that WPP’s North American business has grown for the eight consecutive quarter following a strong upturn in the US advertising industry. Sorrell is expected to cite increased adspend by key clients such as Unilever and Colgate as evidence that business are bouncing back following a prolonged period of recession.
A positive performance for WPP, one of the world’s largest advertising groups, should help calm fears that high oil prices, rising interest rates and general economic worries could hamper the long-awaited upturn in global advertising. However, Sorrell is expected to warn about the danger these factors pose to the world economy, as well as the possibility of fiscal tightening in the US.
WPP’s third quarter revenues look set to add weight to the latest quarterly Bellwether report from the IPA, which last week revealed that the number of UK companies increasing their marketing spend outnumbered those cutting it for the fourth consecutive quarter.
This represented the first time in history that there has been a rise in the third quarter of the year, which is typically the time when advertising budgets are trimmed back. However, recent events such as Euro 2004 and the Olympics have given the industry a much needed shot in the arm (see UK Marketing Recovery Still On Track).
WPP: 020 7408 2204 www.wpp.com
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