WPP AUNZ expects profit to improve in 2020, according to an trading update today.
The company says net sales are expected to be between $630 million and $650 million, a 4% to 6% increase on the 2020 financial year.
This improved outlook, combined with a cost cutting benefit of $65 million, is expected to produce headline EBIT (earnings before interest and tax) of between $85 million and $95 million.
The outlook assumes the economy continues its recovery and there are no new material COVID-related economic impacts and restrictions.
The company also expects to return to paying dividends in the 2021.
In the current December quarter, revenue will still be below the the same three months last year. A net sales decline of 14% to 15% is expected.
For the full year to December, WPP AUNZ expects net sales to be $608.5 million, down 14.6% on 2019.
WPP AUNZ: "The company will move into the ‘strengthen’ phase of its strategy in FY21. This phase includes initiatives to drive client engagement, top line growth, and expansion in growing areas of the market.
"It will concentrate on investing in technology (Martech, data), commerce and experience solutions, while maintaining best-in-class, technology-driven services and solutions in communications (media, creative, PR)."
Jens Monsees, CEO of WPP AUN, told staff in an email: "With good momentum in recent client engagements, as well as an improvement in the macro economic environment, we are confident about this outlook.
"Our strategy is to transform, strengthen and grow our business over the coming few years. With much of the transformation phase of our strategy complete, 2021 is about strengthening and growing our business.
"Next year will see the introduction of a number of initiatives to drive an increase in our revenue and profitability. These include improving client engagement, growing our top line and continued expansion in communications, tech, commerce and customer experience.
"2020 has been an extraordinary year; we are all now looking forward to a positive 2021 and bringing more creative and original ideas and advice to our clients."
Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at adnews@yaffa.com.au
Sign up to the AdNews newsletter, like us on Facebook or follow us on Twitter for breaking stories and campaigns throughout the day.