WPP PLC (LSE:WPP) has revised up its revenue forecast for the full year after it achieved a “strong” performance in the third quarter.
Like-for-like (LFL) revenue less pass-through costs is now expected to show growth of 6.5%-7.0% in 2022, which is above the previous forecast of 6.0%-7.0%, the advertising and marketing conglomerate said in a third-quarter trading update.
The FTSE 100-listed company also adjusted guidance for its headline operating margin to a rise of 30-50 basis points (bps) from the 50 bps increase forecast previously.
Revenue less pass-through costs totalled £2.98bn in the third quarter, a rise of 3.8% LFL on the same period last year and 10.9% higher than in pre-pandemic 2019. Total reported revenue grew by 10.3% to £3.57bn.
In the year to date, LFL revenue less pass-through costs was up by 7.1% at £8.49bn.
Among the company’s top five markets, the US grew by 4.5%, the UK by 4.2%, and India by 10.7%, while revenue fell by 9% in China. In Germany, revenue dropped by 8.7% but was 3.3% higher excluding the impact of a Covid-related contract in the prior year.
The Public Relations business saw the highest growth in the third quarter, with revenue up 5.8%. Specialist Agencies saw a 3.9% drop in revenue, but this was 8.6% higher excluding the Covid-related contract.
Net new business won totalled US$1.7bn in the third quarter, including assignments with Nestlé, Samsung and SC Johnson, and was US$5.1bn in the year to date.
"WPP continues to show strong momentum, reflecting broad-based growth across our agencies, markets and industry sectors and the investment by our clients in marketing, eCommerce and digital transformation. Our performance on a three-year basis has continued to improve each quarter during 2022," commented WPP chief executive officer Mark Read in the statement
He said that the company is on track with its £300mln transformation savings and added that it will continue to manage costs “with discipline”.
"We enter the last quarter of the year with confidence, based on the leading competitive position of our businesses, our client momentum and the knowledge that the actions we have taken to strengthen WPP leave us well-placed to support our clients in navigating the economic uncertainties ahead," Read concluded.