WPP, the world's biggest advertising group, posted a full year operating loss, announced a the resumption of a share buy back and described its performance as "resilient" with a "solid" year ahead.
The operating loss was £2.278 billion for the 12 months to December, mainly in writedowns in the value of agencies. Impairments totalled £3.12 billion, including £1.2 billion in goodwill for Wunderman Thompson.
The company has reported continual improvement since the depths of the pandemic with sales down 15.1% in the second quarter, -7.6% Q3 and –6.5% Q4.
Net debt was £0.7 billion, the lowest since 2004.
Savings in 2020 were £810 million and another £600 million identified over the next few years
The company now has just under 100,000 employees and expects to be adding headcount over the next year.
Across the world, VMLY&R was the best performer of 2020, close to flat for the 12 months and growing in December quarter.
In Australia, WPP AUNZ announced its full year results in February. The UK company is in the process of taking full control of Australian operations.
"We enter 2021 in a good place," CEO Mark Read told a briefing of market analysts.
He reported $US4.4 billion in net new business, including Alibaba, HSBC, Intel, JP Morgan, Uber and Unilever.
The company announced a final dividend of 14 pence and the resumption of a share buy back using proceeds from the Kantar sale.
“2020 was a tough year for everyone, including our people who faced the personal and professional challenges of COVID-19," says Read.
"Their commitment to our clients, support for one another and contribution to the communities we serve have been a constant source of inspiration and pride.
“WPP’s performance has been remarkably resilient, thanks to these efforts and the demonstrable value of what we do for our clients.
"While revenue was significantly impacted as clients reduced spending, our performance exceeded our own expectations and those of the market throughout the year. There is no doubt that the actions we took during the previous two years to transform and simplify the business and reduce debt – to a 16-year low at the end of 2020 – played a crucial role in the strength of our response.
“At the height of the pandemic we saw five years’ worth of innovation in five weeks, with a dramatic shift to digital media and ecommerce as people’s lives went online – trends on which we based our vision for WPP.
"Having modernised our client offer, refined our structure and strengthened our agency brands, we were well prepared for this shift and saw the benefits of this acceleration in parts of our business.
“We see many areas of attractive growth for WPP, from the permanent shift to ecommerce, the digitisation of media and the need from our clients to convert brand purpose into action.
"The past 12 months have demonstrated the importance and impact of communications. The demand from clients for simple, integrated solutions that combine outstanding creativity with sophisticated data and technology capability is only set to grow and, while uncertainties remain around the impact of the vaccine roll-out and economic growth, we continue to expect 2021 to be a year of solid recovery.”
2020 numbers:
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