The company reported revenue dropped 2.9% for the quarter, to $1.44 billion, and dropped more than 3% on an organic basis, after factoring out acquisitions and currency effects. The weakness was most pronounced in the North American region and in WPP's public relations and branding and identity units.
North America revenues down
North American revenue
Finance Director Paul Richardson said revenues for the fourth quarter and the full year are now expected to be down. The company had expected much easier comparisons starting in September, but that month came in flat and signs of weakness continue, he said.
Mr. Richardson noted the company has added $2.9 billion in net new business year-to-date -- ahead of last year's $2.5 billion total -- but new billings are slow to show up in revenue, so the effects of recent wins such as Mattel and Gillette Co. may not appear until next year.
Consumer spending slowdown
In spite of recent upbeat comments from broadcasters including Viacom, advertising and the U.S. economy remain weak, said Chief Executive Martin Sorrell. There are signs now of a slowdown of consumer spending, and concern over holiday retail sales is surfacing, he said. True recovery may have to wait until 2004, he said.
"If you want to depress yourself, you can find some data to depress yourself," Mr. Sorrell said. "There's some evidence of a double-dip, and we have to be concerned about it."