WPP's strong figures shine light on health of the economy

Total year-on-year sales from the UK were up 7.4 per cent to 262.3m in the three months ending September 30, compared with 0.2 per cent growth in the first quarter and a rise of 5.1 per cent in the second quarter.

WPP's figures are viewed as an important bellwether of the economy because companies' spending on advertising and marketing can reflect their confidence and strength.

The strong figures from the UK helped the company record 7.5 per cent like-for-like sales growth globally – its strongest quarterly like-for-like growth for a decade. Total revenues were up 12.2 per cent to 2.3bn, helped by the weak pound. WPP's growth has been driven by trading in the United States, which it said behaved more like an emerging market following growth of almost 10 per cent in the most recent quarter.

Traditional advertising has also recovered sharply, with an increasing trend in the first nine months. WPP, which owns names such as Ogilvy & Mather and J Walter Thompson, added: "This continuing overall improvement is most welcome, particularly after the brutality of a post-Lehman 2009.

"Calendar 2010 looks set fair with a good fourth quarter in prospect, particularly as most of our clients budget on a calendar year basis."

WPP said it expected like-for-like revenues in 2011 to be similar to this year, compared with a previous forecast for a 2 per cent rise. The revision follows the stronger-than-expected 2010 and amid ongoing fears over the strength of American consumer demand and impact of deficit cuts by governments.

It has also announced a 3.1m strategic investment in Buddy Media, which helps brands build a presence on Facebook.