WPP's Q3 Growth of 3.3% Was Boosted by Better U.S. Results

Sorrell says India Is 'The Only BRIC Left Standing'

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Martin Sorrell
Martin Sorrell Credit: Dario Pignatelli/Bloomberg

WPP's third quarter 2015 net sales were up 3.3% globally, boosted by improved North American revenue, up 6.8%.

The world's biggest marketing services group reported overall revenues, including acquisitions, of $4.49 billion for the third quarter, up 5.9% on the same period last year.

Asked at an investor meeting whether he was disappointed with the growth, WPP CEO Martin Sorrell said, "I'm always disappointed, but I'm not particularly disappointed with these results. If you look at the pattern, July and August were good. September was less good but it's still good overall."

North America, which accounts for 37.2% of group revenues, reported growth of 6.8% in the third quarter. Mr. Sorrell said, "The U.S. recovery continues, although it's somewhat patchy. It's not just less tourists buying in the U.S. because of the strength of the dollar, but also because there is patchiness in domestic consumption. But broadly the U.S. remains pretty strong."

WPP's home territory of the U.K. showed slower organic revenue growth of just 1.1% in the third quarter, while Western Continental Europe was up 6.1%.

Asia Pacific, Latin America, Africa and the Middle East, and Central and Eastern Europe together grew 2.9% in the third quarter, bringing in $1.3 billion and 29.1% of group revenues.

Mr. Sorrell said that India, where double-digit growth continues, is "The only BRIC left standing… The other three [Brazil, Russia and China] are in tough shape."

However, he added, "It's quite clear that the next billion consumers on the planet will come from Asia Pacific – that argument applies equally to Latin America, and Africa and the Middle East – so clients are still very focused on fast growth markets. Having said that, efficiency, effectiveness, procurement and finance are still front and center [for marketers]... There is a considerable pressure for continuous improvement."

Speaking about the spate of media reviews over the summer, which he labeled a "tsunami," Mr. Sorrell said that technology, data and content are the key areas that clients are using to discriminate between agencies.

But other factors are also at play. He added, "Cord cutting, the debate about the impact of new media on television, measurement issues, bots issues, potential fraud issues -- all those issues raise the temperature and raise issues about the complexity of media choices. That obviously impacts the complexity of those reviews and… compounds the anxiety."

WPP claimed net new business for the quarter of $4.9 billion in the first nine months of the year, which Mr. Sorrell said put the group first in all the net new business league tables.

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