Wpp Plc · LSE:WPP
Wpp — Q1 2013 Earnings Presentation
26 slides from Wpp's earnings presentation, April 2013
Slide 1: Trading Statement for the First Quarter 2013
Trading Statement for the First Quarter 2013 April 2013 1
Slide 2: First Quarter 2013 Highlights
First Quarter 2013 Highlights Q1 organic revenue growth of 2.1% with 3.0% contribution from acquisitions. Q1 profits and operating margin above budget and well ahead of last year. Strongest region - Asia Pacific, Latin America, Africa & the Middle East and Central and Eastern Europe, with orga
Slide 3: First Quarter 2013 Summary
First Quarter 2013 Summary Reported revenue up 5.9% with constant currency revenue up 5.1%. Like-for-like revenue up 2.1% with gross margin up slightly less at 1.9%. First quarter profits and margins ahead of budget and well ahead of last year. Net new business wins in the first quarter of $
Slide 4: First Quarter 2013 Summary
First Quarter 2013 Summary Asia Pacific, Latin America, Africa & the Middle East and Central & Eastern Europe continues to be fastest growth region with like-for-like growth of 7.8%. UK strong with like-for-like growth of 3.7%. Western Continental Europe remains challenging with like-for-like
Slide 5: Summary – Revenue Growth
First Quarter 2013 Summary – Revenue Growth % Like-for-like 2.1 Acquisitions 3.0 Constant currency 5.1 Foreign exchange 0.8 Reportable sterling 5.9 Reportable US dollars¹ 4.1 Reportable euros² 3.6 1 Translated into US$, using among other currencies, average exchange rates of US$/£ for Q1 2013 of $1.
Slide 6: Revenue by Discipline
First Quarter 2013 Revenue by Discipline % Change 2013 2012 Reported Constant Like-for- £m £m Currency like Advertising, Media Investment 1,032 973 6.0 5.4 3.9 Management Consumer Insight 588 569 3.2 2.5 1.0 0.9¹ Public Relations & Public Affairs 221 225 -1.4 -2.7 -4.1 Branding & Identity, Healthcar
Slide 7: Advertising, Media Investment Management
First Quarter 2013 Advertising, Media Investment Management Strongest performing sector with like-for-like growth of 3.9% in first quarter. Strong growth in Y&R and Grey in the first quarter, particularly in the United States following several major new business successes in 2012. Still awaiting
Slide 8: Consumer Insight
First Quarter 2013 Consumer Insight Consumer insight significant improvement over the final quarter of 2012 with like-for-like revenue up 1.0% and gross margin up 0.9%. Like-for-like revenue growth in North America in the first quarter, the first time for a considerable period. Like-for-like r
Slide 9: Public Relations & Public Affairs
First Quarter 2013 Public Relations & Public Affairs Constant currency revenues down 2.7%, with like-for-like down 4.1%, with all of the Group’s brands affected. Geographically, North America, Western Continental Europe and Asia Pacific were particularly difficult. The United Kingdom and Latin A
Slide 10: Branding & Identity, Healthcare and Specialist Communications
First Quarter 2013 Branding & Identity, Healthcare and Specialist Communications Continuing good performance with constant currency revenues up 10.0% and like-for-like revenue growth of 2.4% in first quarter. The Group’s Specialist Communications businesses showed the strongest growth of this se
Slide 11: Direct, Digital and Interactive
First Quarter 2013 Direct, Digital and Interactive At 31 March 2013, direct, digital and interactive revenues were $1.3bn or almost 34% of total revenues (2012: $1.1bn and 31% respectively), up 15.8% in constant currency and up 7.5% like-for-like. The number of people working in the Group in thi
Slide 12: Revenue by Region
First Quarter 2013 Revenue by Region % Change 2013 2012 Reported Constant Like-for- £m £m Currency like North America 886 864 2.5 0.9 -1.0 UK 318 284 11.9 11.9 3.7 4.9¹ Western Continental Europe 592 563 5.1 2.7 -0.8 Asia Pacific, Latin America, Africa & Middle East, Central & Eastern 736 681 8.1 9.
Slide 13: Growth by Region
First Quarter 2013 Growth by Region Asia Pacific, Latin America, Africa & the Middle East and Central and Eastern Europe the strongest region, with like-for-like revenues up 7.8%. Double digit growth in Latin America, with the BRICs up over 10% and Next 11 up over 11%. In Asia Pacific, Greater C
Slide 14: Revenue Growth by Country
First Quarter 2013 Revenue Growth by Country Revenue Growth1 Countries >20% Argentina 15% to 20% Brazil, South Africa, Thailand 10% to 15% Mainland China² 5% to 10% Greater China³ Average4 to 5% Australia, India, Italy, Mexico, Russia, South Korea, UK Belgium, Canada, Denmark, France, Germany, Japan
Slide 15: Revenue Growth by Category
First Quarter 2013 Revenue Growth by Category Revenue Growth¹ Categories >15% Oil 5% to 10% Government Average² to 5% Automotive, Drinks Computers, Electronics, Entertainment, Financial Below Average² Services, Food, Personal Care & Drugs, Retail, Telecommunications, Travel & Airline ¹ Like-for-like
Slide 16: Effects of Currency
First Quarter 2013 Effects of Currency Currency movements accounted for a 0.8% increase in revenue, largely reflecting the weakness of the £ sterling against the euro and the US$, partly offset by strength against most faster growing market currencies. Sterling weaker overall as follows: Q1 2013
Slide 17: Trade Estimates of Major New Business Wins – First Quarter
First Quarter 2013 Trade Estimates of Major New Business Wins – First Quarter WPP Agency Incumbent Account Office Billings($m) Mindshare IPG/Mindshare Lionsgate/Summit USA 400 JWT OMC Vonage USA 160 GroupM PUB 360buy.com China 160 MediaCom OMC Fonterra Asia Pac/M East 150 Grey Grey Kellogg’s/Pringle
Slide 18: Trade Estimates of Major New Business Losses – First Quarter
First Quarter 2013 Trade Estimates of Major New Business Losses – First Quarter WPP Agency Winning Agency Account Office Billings($m) Mindshare PUB AbbVie Global 365 JWT PUB HSBC Wealth Global 32 18
Slide 19: Internal Estimates of Net New Business Wins – Year to Date
First Quarter 2013 Internal Estimates of Net New Business Wins – Year to Date ($m) Creative Media Total Advertising 449 743 1,192 Other Businesses 312 - 312 Total 761 743 1,504 19
Slide 20: Trade Estimates of Major New Business Wins/Losses Since April
First Quarter 2013 Trade Estimates of Major New Business Wins/Losses Since 1 April WPP Agency Incumbent Account Office Billings($m) GroupM PUB Nestlé USA 750 WINS Y&R PUB/IND JCPenney USA 420 JWT PUB STB Singapore n/a 20
Slide 21: Cash Flow and Net Debt
First Quarter 2013 Cash Flow and Net Debt Average net debt in the first three months up £331 million to £3.015 billion, compared to £2.684 billion in 2012, at 2013 exchange rates. Acquisitions (including earnouts) and share buy-backs totalled £114 million in first quarter of 2013. Net debt at
Slide 22: Acquisitions and Investments – Year to Date
First Quarter 2013 Acquisitions and Investments – Year to Date Faster Growing Quantitative & Markets Digital C-Section (Turkey) Globant (Argentina) Kantar Myanmar eCommera (UK)¹,² Today Advertising (Myanmar) LEADING SMART (CHINA)¹,² PLAY (Australia) Netbooster (Indonesia/Philippines) Salmon (UK) REP
Slide 23: Uses of Free Cash Flow
First Quarter 2013 Uses of Free Cash Flow Category March YTD 2013 March YTD 2012 FY 2012 New acquisitions¹ £65m² £27m² £500m² Share purchases/cancellations: £49m £21m £134m % of issued share capital 0.4%³ 0.2% 1.3% Dividend increase n/a n/a 16% ¹ Includes investments and step-ups in subsidiaries’ eq
Slide 24: First Quarter 2013 Summary
First Quarter 2013 Summary The year has started satisfactorily with like-for-like revenues up 2.1% and 3.0% contribution from acquisitions, ahead of budget. Most geographies and most sectors are growing revenues. Better revenue performance from consumer insight with growth in USA. First quarte
Slide 25: Outlook
First Quarter 2013 Outlook Trading in the first quarter was above budget and in line with target margin improvement for 2013 as budgeted. Preliminary quarter one revised forecasts show like-for-like revenue growth better than budget, with targeted improvement in margin as budgeted. Growth in f
Slide 26: Trading Statement for the First Quarter 2013
Trading Statement for the First Quarter 2013 April 2013 26