FX.co ★ WPP Q1 Revenues Down, LFL Revenue Rises; Backs FY24 Outlook

WPP Group Plc, a British communication services provider, has reported a first-quarter revenue of 3.41 billion pounds for this year, a 1.4 percent decrease from the previous year. However, on a like-for-like basis, revenues experienced a growth of 2.1 percent.

The overall revenue of the group, less the pass-through costs, witnessed a 5 percent decrease, falling to 2.69 billion pounds from the last year's 2.83 billion pounds, and on a like-for-like basis saw a 1.6 percent downfall.

The growth observed in the UK and Western Continental Europe were balanced by declines in North America and Asia Pacific. Notably, while the Asia Pacific region faced a decline, India exhibited strong growth contrasting with the downfall in China.

As for the fiscal year 2024, WPP anticipates the growth of like-for-like revenue less pass-through costs to range between 0 to 1 percent. They also predict an improvement in the headline operating margin from 20 to 40 basis points, without considering the impact of foreign exchange.

WPP holds a mid-term expectation of a 3 percent like-for-like growth in revenue less pass-through costs, and estimates the headline operating profit margin to be between 16 to 17 percent.

According to Mark Read, WPP's Chief Executive Officer, the first quarter of 2024 has met their expectations, despite facing the toughest comparison of the year. The company believes that its full-year prospects stand unchanged. Read states that they are on track to return to growth for the rest of the year, bolstered by an encouraging new business pipeline and the strength of their creative and media business. Additionally, the integration of new AI capabilities and a simplified organizational structure are expected to foster flexibility and enhance cash conversion.