WPP Group, the owner of the Young & Rubicam and MediaCom networks, has reported pre-tax profits of £1.1bn in 2012, up 8.3% year on year after strong performances in its advertising and media investment division
According to WPP’s preliminary results for the year ended 31 December 2012, WPP made revenue of £10.37bn, an increase of 3.5% year on year or 5.8% on a constant currency basis.
WPP made a profit before taxation of £1.09bn in 2012, up 8.3% from £1.01bn in the previous year and an increase of 14.6% when the effect of changes in currency exchange rates is stripped out.
Advertising and media investment management brought WPP revenue of £4.27bn in 2012, an increase of 2.8% year on year or 5.2% on a constant currency basis.
The advertising and media investment management division of WPP reported an operating profit of £755m in 2012, an increase of 13% year on year and representing a profit margin of 17.7%.
In total WPP’s billings were worth £44.41bn, a decrease of 0.9% year on year that was primarily connected to the strength of sterling. Billings increased by 1.6% in constant currency.
Looking forward, WPP said January 2012 revenues were ahead of budget. All regions, except North America, were up and of the sectors media investment management, consumer insight and healthcare communications were up the strongest.
Repeating concerns aired by Sir Martin Sorrell last month, WPP cited the decision to launch a referendum for Britain’s European Union membership as a new "grey swan", or known unknowns affecting clients’ confidence.
The other four grey swans affecting confidence are: the fragility of the Eurozone, problems in the Middle East, the possibility of a "hard or soft landing" in China or the BRIC countries and the US deficit.
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