Sir Martin Sorrell’s WPP, the world’s largest advertising company, has reported a 12% rise in pre-tax profits to £1.45bn for 2014 – with strong performances from its agencies in the US, Britain and China.
The group said on Monday that it had been a good start to 2015 with January like-for-like revenue up 6.7% and net sales up 3.9%. Headline profit before tax hit £1.513 billion, up 3.7%.
However, despite the good news, the group warned that the future will be met with political and economic uncertainties.
“If the Conservatives win outright (unlikely?) or lead a coalition or even form a minority government, there will be a Referendum on the EU in 2016 or 2017, which will cause significant uncertainty,” the company said.
“If Labour wins outright (also unlikely?), or leads a coalition (more likely with the SNP?) or forms a minority government, it will win partly on a ‘bashing business’ manifesto, which may resonate at the ballot box.
“All seems a case of ‘Morton’s Fork’. Either way, the United Kingdom economy may slip into the political cycle again, with austerity in the early part of the five year cycle to deal with the continuing Budget deficit and better times around the next election in five years’ time (or earlier?) – just like the current Chancellor has done so brilliantly for the Coalition, in their first
term.”
WPP, which has more than 188,000 staff in 111 countries, saw the UK’s rate of growth in the final quarter stand slightly above quarter three, with constant currency revenue up 15%, compared to 14.9%.
The group’s UK advertising and media investment management and public relations and public affairs businesses performed particularly well.
Source: WPP.
