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WPP shares drop as advertising giant posts worst full-year performance since financial crisis

WPP, which cut its sales outlook three times in 2017, reported a 0.9% fall in full-year like-for-like net sales, against its October forecast of flat growth

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The firm said demand was particularly weak in North America, while the UK was one of the strongest performers

WPP PLC (LON:WPP) saw its shares drop by over 11% in early trading on Thursday after the world's biggest advertising group reported its worst performance since the financial crisis, and forecast no growth for 2018.

The FTSE 100-listed company, which has been hit by a reduction in spending from consumer goods giants and increasing competition, also revealed plans to simplify its structure.

READ: WPP lowers full-year guidance after third-quarter revenue decline as advertisers cut spending

The firm, run by high-profile businessman Martin Sorrell, said its budgets for 2018 were being set on the basis it would see flat growth for revenue and net sales, with the headline operating margin also flat in constant currency.

Sorrell said: "As our industry continues to undergo fundamental change, we are upping the pace of WPP's development from a group of individual companies to a cohesive global team dedicated to the core purpose of driving growth for clients."

WPP, which cut its sales outlook three times in 2017 reported a 0.9% fall in full-year like-for-like net sales, against its forecast given in October of flat growth.

The group’s reported revenue for 2017 was up 6.1% to £15.27bn and reported billings rose by 0.6% to £55.56bn, but were down 5.4% on a like-for-like basis.

WPP’s reported pre-tax profit increased by 12% to £2.11bn for 2017, up from £1.89bn in 2016.

The firm said demand was particularly weak in North America, while the UK was one of the strongest performers.

In early trading, WPP shares were down 11.7% at 1,231.60p.

Quick facts: WPP PLC

Price: 602 GBX

LSE:WPP
Market: LSE
Market Cap: £7.37 billion
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