WPP revenues down in Q2

UK – Revenue at advertising and communications business WPP has bettered expectations despite a fall of 15% in the second quarter of 2020.

mark read

In its interim financial results for 2020, revenue less pass-through costs were down 15.1%, and fell 23.3% in the UK. In comparison, WPP’s first quarter revenue was down 7.9% in March as the company felt the effects of Covid-19.

WPP’s half-year revenue minus pass-through costs was 10.2% down, but the company said that it had improved liquidity and was on track for £700m to £800m of cost savings, of which £296m have already been realised.

Around 25% of the savings are expected to be permanent when the company recovers from the Covid-19 lockdown. The proposed savings announced earlier this year included freezing new hires; reviewing freelance expenditure; stopping discretionary costs; and postponing planned salary increases.

The company has restarted paying a dividend of 10p, citing the better than expected results.

Net debt at WPP is £2.7bn, down £1.5bn year-on-year. The company said this reflected its sale of 60% of global research, consulting and analytics business Kantar to Bain Capital Private Equity, as well as strong working capital management.

Mark Read (pictured), chief executive officer at WPP, said that assuming there is neither a second wave of Covid-19 nor any further major national lockdowns, the company had likely passed through the toughest period of the year, but was cautious at how quick the recovery would be.

“Our strategic transformation remains on track but as Covid-19 accelerates the change in our sector, we are accelerating our plans,” Read added.

“With £4.7bn of liquidity thanks to the Kantar transaction, and as we deliver against our cost savings targets, our financial position remains strong. As a result, we are able to return to paying our dividend, with an interim dividend of 10p for 2020.”

We hope you enjoyed this article.
Research Live is published by MRS.

The Market Research Society (MRS) exists to promote and protect the research sector, showcasing how research delivers impact for businesses and government.

Members of MRS enjoy many benefits including tailoured policy guidance, discounts on training and conferences, and access to member-only content.

For example, there's an archive of winning case studies from over a decade of MRS Awards.

Find out more about the benefits of joining MRS here.

0 Comments

Display name

Email

Join the discussion

Newsletter
Stay connected with the latest insights and trends...
Sign Up
Latest From MRS

Our latest training courses

Our new 2025 training programme is now launched as part of the development offered within the MRS Global Insight Academy

See all training

Specialist conferences

Our one-day conferences cover topics including CX and UX, Semiotics, B2B, Finance, AI and Leaders' Forums.

See all conferences

MRS reports on AI

MRS has published a three-part series on how generative AI is impacting the research sector, including synthetic respondents and challenges to adoption.

See the reports

Progress faster...
with MRS 
membership

Mentoring

CPD/recognition

Webinars

Codeline

Discounts