Yahoo Finance FTSE 100: WPP ups full-year outlook after 'strong' revenue growth
British advertising firm WPP (WPP.L) has raised its full-year outlook on the back of higher revenues, but tempered its expectations for profit margin growth amid slowing ad demand.
The FTSE 100 (^FTSE) company, one of the world’s biggest marketing groups, upped its guidance for 2022 revenues to 6.5% to 7%, an increase from the previous 6-7% range.
Headline operating margin was trimmed and is now forecast to rise by 30 to 50 basis points, against previous prediction of around 50 basis points.
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Like-for-like revenue, minus pass through costs, jumped 3.8% in the third quarter, beating analyst estimations.
Revenues increased 10.3% in Q3 to £3.6bn, or 2.7% on a like-for-like basis, with year-to-date revenues up 10.2% at £10.32bn ($11.95bn). The company won $1.7bn in net new business throughout the third quarter period.
Shares in the company fell 3.6% in early trade to 742p in London.
WPP joined industry rivals in raising guidance for advertising growth this year despite the economic slowdown affecting the digital advertising market.
The London-based group hasn't indicated how the global economic downturn is expected to affect its long term targets next year.
But, Mark Read, chief executive of WPP, said growth over the year had been "strong", adding the company was well placed to "support our clients in navigating the economic uncertainties ahead".
Wednesday's upgrade follows those at Omnicom (OMC), Interpublic (IPG) and Publicis (PUB.PA), suggesting that diversified marketing groups have so far emerged unscathed by troubles in the digital advertising market.
It comes as Goggle-owner Alphabet (GOOGL) on Monday reported slowing sales growth at its search business and a fall in ad sales at YouTube.
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