Switch off the editor’s digest free of charge
Roula Khalaf, editor of the FT, selects her favorite stories in this weekly newsletter.
WPP, the advertising agency based in London, who is looking for a new managing director, has reduced its forecast for income and profits this year and blamed a “challenging economic backdrop”.
The group announced on Wednesday that the same revenue in 2025 would decrease by 3-5 percent when removing pass-through costs to external suppliers after poor trade in the first year of the year.
This marks a sharp downgrade from the previous expectations of flat to 2 percent a year. This estimate was partly based on the assumption that the new business would lose weight in the course of the year, which WPP did not achieve.
The company’s shares decreased by 14 percent in early trade on Wednesday.
WPP Said that the macro economic conditions would have heavily burdened customer expenses and that fewer new businesses had been given than expected. This would lead to a decline in the headlines of 50 to 175, added.
Uniform sales would drop by 4.2 percent to 4.5 percent in the second half after a fall of up to 6 percent in the second quarter.
Mark Read, the managing director, the announced his departure In June we said after a 30-year career at the agency: “Since the beginning of the year, we have exposed ourselves to a challenging trade environment with tightening the macro printing and a lower net business.”
Read, who will continue as a managing director until the end of the year, while the board of directors begins the search for a successor, added that the group’s performance in June was worse than expected, and “this trade pattern would continue in the second half in the first half”.
The numbers again mark the extent of the challenge for the challenge Chairman Philip JansenThe former BT managing director with a recording of corporate restructuring and dealmaking that was appointed last year.
The WPP share price has dropped by more than half during the term of Read as Chief Executive and has taken over its market capitalization to around 5 billion GBP.
WPP is below average compared to some of its competing global advertising agencies such as publicis. However, she tried to invest more in AI tools and services for customers based on data and technology to deliver advertising campaigns cheaper, faster and more to individual consumers.
