WPP said revenues for the third quarter ended Sept. 30 rose by almost 11%, to $1.7 billion compared to the year-ago quarter. On a like-for-like basis, excluding the impact of WPP's acquisition of Cordiant Communications Group and currency fluctuations, revenues rose by 1%.
The North American market has "not only stabilized, but has started to show muted growth," WPP said. The health of other markets varies: the U.K. remains "most affected" by the current recession compared with the rest of Europe, while other regions -- Asia Pacific, Africa and Latin America -- "improved significantly."
In terms of new-business wins for the holding company for the first nine months, "this year is not in any way disappointing" compared with last year, Martin Sorrell, WPP's chief executive, said question-and-answer period after results were announced.
The company pointed to account wins for media services network MindShare, which is currently vying for Coca-Cola Co.'s media business, and advertising networks Ogilvy & Mather Worldwide and Berlin Cameron/Red Cell, which have also picked up significant new accounts.
"Operating margins appear to have bottomed," said Lorna Tilbian, an analyst at Numis Corp. "WPP is forecasting that margins will improve in the second half compared to the first half." For the full year, WPP aims to deliver a 13% full-year operating margin, Ms. Tilbian said. Mr. Sorrell reiterated that "13.8% is a wholly respectable margin target," and the company is not changing the number despite signs of some business improvements.
WPP is positive about prospects for 2004, saying that the Summer Games in Athens, the European Football Championships and the impact of heavy political advertising in the U.S. will strengthen advertising and marketing services spending, particularly in the U.S., and will spill into the U.K. and other parts of the world.
"Most of our businesses are thinking about growth of 3% to 4% in 2004," Mr. Sorrell said.