Advertising giant WPP hailed a landmark year today after achieving revenues of £10bn and profits of £1bn in “difficult circumstances”.
The group, which employs 158,000 full-time staff and is the world’s largest advertising and media group, claimed record performances “on virtually whatever measure you care to name”.
Revenues rose 5.3 per cent on a like-for-like basis and should be up another four per cent in the current year, while bottom-line profits reached £1bn for the first time.
The improved performance came despite the eurozone crisis in the second half of 2011, which triggered uncertainty amongst both consumers and businesses.
WPP, whose chief executive is Sir Martin Sorrell, said: “Despite this, advertising and marketing services expenditures continued to rise and there seem to have been some significant changes, particularly in corporate behaviour, to explain why.”
Unlike in 2009, when consumers and firms were focused almost totally on rapidly reducing costs and de-leveraging, WPP said firms were prepared to invest in capacity and behind brands in fast growing markets.
“They were also prepared to invest in brands to maintain or increase market share even in slow growth Western markets, such as the US and Western Europe.”
The European football championships, the London Olympics and Paralympics and the US presidential elections should underpin industry revenues by one per cent alone this year, WPP predicted.
It added: “Both consumers and corporates are likely to continue to be cautious and fearful, but should continue to purchase or invest in brands in both fast and slow growth markets.”
WPP’s UK division, which accounts for around 12 per cent of the company’s turnover, was one of the best performing regions, with revenues up 8.8 per cent last year from brands that include Ogilvy, Grey, Kantar and GroupM.