Commenting on the quarter Mark Read, chief executive officer of WPP says, “We are encouraged by progress during the quarter, but with recent new business wins primarily impacting 2025 and continuing macroeconomic pressures our expectations for the full year remain unchanged.”
The network reported Q3 revenue up +1.4% and LFL revenue +4.1%.
Q3 LFL revenue less pass-through costs are +0.5%, with North America +1.7%, Western Continental Europe +2.2% and UK flat, partially offset by a 2.2% decline in Rest of World, reflecting a continued decline in China (-21.3%).
For Global Integrated Agencies Q3 LFL revenue less pass-through costs grew 0.5% (Q3 2023: +0.1%).
GroupM growth improved sequentially to 4.8% (Q3 2023: +1.6%), offset by a 3.1% decline at integrated creative agencies (Q3 2023: -1.1%).
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“Our third quarter delivered like-for-like growth in net sales, with a strong performance from GroupM in particular. We saw growth in North America, Western Continental Europe and India, though trading in China remains difficult,” says Read.
The network cited encouraging success in recent pitches built around WPP Open that assisted Q3 net new billings to stand at $1.5bn (Q3 2023: $1.4bn) with year-to-date at $3.2bn (YTD 2023: $3.4bn).
It states, “strong progress on strategic initiatives with new products, capabilities and solutions launched within WPP Open, our AI-powered marketing operating system”.
It adds that Burson, GroupM and VML are on track to deliver targeted savings and build simpler, stronger businesses.
“Our people are increasingly embedding AI in the way that we work and deliver creative and media campaigns to clients, with usage of WPP Open up 107%6 since the beginning of the year.
“Supporting this, the creation of VML and Burson, and the simplification of GroupM, are delivering a stronger business and structural cost savings,” says Read.
Adjusted net debt as of 30 September 2024 £3.6bn, down £0.3bn year-on-year.
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Top 10 clients and new client wins
Its top 10 clients grew 7.0% in Q3.
CPG, automotive, travel & leisure and financial services client sectors grew well in the quarter.
The technology client sector stabilised, with growth of 1.3% in Q3 vs -5.1% in H1 2024.
The healthcare and retail sectors continued to be impacted by 2023 client losses.
In Q3 its clients wins include Amazon (media ex Americas), Unilever (media, retail media and activation, and creative) and Henkel (media).
“Most importantly, we returned to form in new business, winning Amazon’s media account outside the Americas and securing our media relationship with Unilever, including taking back the retail media and activation business in the US.
“Our success with two of the world’s top 10 advertisers demonstrates the renewed competitiveness of our offer,” says Read.
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Strong start to Q4 2024
The network has also had a strong start to Q4 with Starbucks (US creative) and Honor (global media including China).
“We are also proud to be supporting the new Starbucks leadership team with our recent creative win in the US,” says Read.
The agreement to sell WPP’s majority stake in FGS Global on track to close in Q4, will generate net cash proceeds to WPP of c.£604m after tax. Proceeds will be used to reduce leverage.
2024 guidance remains unchanged as 2024 LFL revenue less pass-through costs of -1% to 0%, with Q4 facing a tougher comparative than Q3 and macro uncertainty.
Improvement in FY24 headline operating profit margin of 20-40bps (excluding the impact of FX).
