ADVERTISING giant WPP today posted falling sales after suffering blue-chip client losses, while ousted former CEO Sir Martin Sorrell stepped up his wheeller-dealing.
The ad giant — now describing itself as a “creative transformation company” — saw sales in the first quarter down 8.5% in the first quarter.
The loss of accounts from Ford, American Express, HSBC and some big pharma companies were behind the falls, leaving chief executive Mark Read facing “a challenging year”.
Across the whole group sales were down 2.8% at £2.92 billion. The sale of data business Kantar is “progressing well”, says WPP.
It claims it is “pleased with the level of interest” in the business, though outsiders have questioned if it will be overtaken by newer rivals with stronger technology.
The market was sanguine about the figures, as was Read. Shares edged up 10p to 916p. Read said: “We’ve got work to do. I think clients are very supportive.”
Debts are down by £712 million to £4.2 billion as Read reverses Sorrell’s deal-hungry strategy. Thousands of jobs have been cut but Read thinks that staff are bullish and that “we’ve done most of what we needed to do in terms of restructuring”.
Meanwhile S4 Capital, Sorrell’s new venture, struck deals to buy Caramel Pictures, which will become part of MediaMonks, a digital content outfit S4 bought last year. It also picked up ProgMedia, a Sao Paulo ad agency that will operate under MightyHive, becoming that firm’s base in Latin America.
Sorrell, left, was ousted after a row over the alleged misuse of company money, including spending on prostitutes. Sorrell denies the claims.
Today he said: “Client interest in our purely digital, first party data, always-on 24/7 programmatic model is frenetic.”
Critics of Sorrell’s reign at WPP say he was slow to embrace the shift to digital.
