WPP Shares Fall After Third-Quarter Report

Holding Company Cites Weakness of U.S. Dollar for Slow Revenue Growth

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NEW YORK (AdAge.com) -- Shares in WPP Group tumbled nearly 5% this afternoon after the London-based holding company reported third-quarter revenue growth that fell short of analysts' estimates. WPP Group's third-quarter revenue grew 4.9% to about $3 billion. The company said in a statement that the weak U.S. dollar was the main factor stifling revenue growth.

WPP Group -- the parent company of MindShare, Mediaedge:cia, Ogilvy & Mather and JWT, among other global networks -- gained the most ground in Asia Pacific, Latin America, Africa and the Middle East, where revenue grew about 14%, excluding the effect of currency movements. Using the same metric, revenue grew about 5% in the U.K., about 5% in continental Europe and about 8% in North America.

WPP Group also reported small to medium digital acquisitions in the U.S., the U.K., Austria, Germany and the Netherlands.

What they're worried about
Representatives for the company in a statement said the recent liquidity crisis has had little effect on client spending, and that they are more concerned with "the impact that any new U.S. administration will have on 2009 -- when they have seen the government's books and will be tempted to displace any politically unpleasant medicine to the electorate early in the potential eight-year political cycle."

However, WPP executives remain optimistic about future ad spending. "We continue to believe that 2008 will be a good year for the industry, better than 2007, reflecting the positive combined impact of the maxi-quadrennial events of the U.S. presidential election, the 2008 Olympics in Beijing and, on a relatively more modest basis, of the European football championships," the company said in a statement.
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