WPP, reporting "sequential improvement" in net sales, still expects the full year to come in flat.
CEO Mark Read was pleased with the "strong" progress against strategic objectives.
However, the company is giving marginally weaker full year like-for-like guidance of -1% to 0%, from 0% to -1% previously, reflecting macro pressures and weakness in China. In April, the company had been expecting flat to 1% growth this year.
June quarter like-for-like revenue less pass-through costs came in at -0.5%.
North America was up 2%, Western Continental Europe 0.3%. However, the UK was down 5.3% and the Rest of World -2.2%, with growth in India +9.1% offset by a decline in China -24.2%.
In the June quarter, like-for-like revenue less pass-through costs fell 0.6% for global integrated agencies with GroupM growing 1.4%, offset by a 2.4% drop at creative agencies.
Staff numbers across the global group fell 3,000 to 111,000.
Operating profit for the half year to June was up 0.5% to £646 million and the profit margin was steady at 11.5%.
The results compare to other global advertising groups: IPG organic revenue growth of 1.7%: Publicis up 5.6%; Omnicom with a better than expected 5.2%; Havas posted negative organic growth of -2.3%.
WPP in January this year set out a strategy to build and improve the competitiveness of WPP’s offer.
"I am very pleased with the progress we have made in the past six months against each of our strategic objectives, particularly our continued investment in AI, the creation of VML and Burson, and the simplification of GroupM,” said Read.
"We are strengthening our offer for clients while building a more efficient company.
“Our second quarter performance delivered sequential improvement in net sales with continued growth in GroupM, Ogilvy and Hogarth and sequential improvement at Burson, VML and our Specialist Agencies.
“Importantly, we also saw North America return to growth in the second quarter.
“That said, we have seen pressure in China and in our project-related businesses which, together with an uncertain macro environment, has led us to moderate our expectations for the full-year."
WPP is selling its majority stake in strategic communications and advisory firm FGS Global to Kite Bidco, an entity controlled by private equity group Kohlberg Kravis Roberts (KKR). KKR, which first made a minority investment in FGS Global in July 2023, will pay $US775 million.
“The sale of our stake in FGS Global is an excellent outcome less than four years after its creation from three separate businesses within WPP," said Read.
"It will allow us to focus and invest in our core creative transformation offer while significantly strengthening our financial position.
“As a team, our priority continues to be improving our competitiveness by delivering a modern, global, creative and integrated offer for our clients.
“The steps we have taken since January to integrate our offer, bring in new talent and invest in AI represent strong progress towards delivering on our medium-term financial targets and to shareholders.”
Numbers for the half year to June:
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.