Wpp Plc · LSE:WPP
Wpp — Q3 2004 Earnings Presentation
22 slides from Wpp's earnings presentation, October 2004
Slide 1: Trading Statement Third Quarter 2004
WPP Trading Statement Third Quarter 2004 October 2004 WPP 1
Slide 2: Summary
Third Quarter 2004 Summary z Third quarter reported revenue up by almost 4%. On a constant currency basis, revenues up almost 12%. Like-for-like revenue growth accelerated to almost 6%, over 7% excluding Cordiant. z YTD reported revenue up over 5%. On a constant currency basis, revenues rose by almo
Slide 3: Summary
Third Quarter 2004 Summary z On a constant currency basis, information, insight and consultancy was the strongest sector, driven partly by acquisitions. z Branding and identity, healthcare and specialist communications up over 13%. z Advertising, media investment management up over 9%, with media in
Slide 4: Summary
Third Quarter 2004 Summary z Net new business wins of £234 million in the quarter, making a total of £1.771 billion in the first nine months. Group ranked first or second for net new business gains in the three major industry surveys for the first nine months of 2004. z New business wins in October
Slide 5: Revenue by Discipline: Third Quarter
Third Quarter 2004 Revenue by Discipline: Third Quarter Revenue 2004 2003 % Change % Change, £m £m Constant currency Advertising & Media Investment Management ¹ 479.9 476.7 0.7 9.3 Information, Insight & Consultancy 195.6 176.4 10.9 18.3 Public Relations & Public Affairs ¹ 112.5 112.8 -0.3 8.6 Brand
Slide 6: Revenue by Region: Third Quarter
Third Quarter 2004 Revenue by Region: Third Quarter Revenue 2004 2003 % Change % Change, £m £m constant currency North America 416.9 424.4 -1.8 10.4 UK 186.5 166.4 12.1 12.1 Continental Europe 262.0 255.9 2.4 6.8 Asia Pacific, Latin America, 202.2 182.9 10.6 22.4 Africa & Middle East Total 1,067.6 1
Slide 7: Revenue by Discipline: First Nine Months
Third Quarter 2004 Revenue by Discipline: First Nine Months Revenue 2004 2003 % Change % Change, £m £m Constant currency Advertising & Media Investment Management ¹ 1,416.6 1,352.3 4.8 12.8 Information, Insight & Consultancy 532.0 510.4 4.2 10.3 Public Relations & Public Affairs ¹ 334.1 336.9 -0.8 7
Slide 8: Revenue by Region: First Nine Months
Third Quarter 2004 Revenue by Region: First Nine Months Revenue 2004 2003 % Change % Change, £m £m constant currency North America 1,226.8 1,243.6 -1.4 10.9 UK 529.9 472.9 12.1 12.1 Continental Europe 786.3 752.7 4.5 7.9 Asia Pacific, Latin America, 550.2 471.2 16.8 26.4 Africa & Middle East Total 3
Slide 9: Advertising & Media Investment Management
Third Quarter 2004 Advertising & Media Investment Management z Revenue up over 9% on constant currency basis, driven by significant improvement in media investment management. Constant currency growth less in third quarter than first half as the acquisition impact of Cordiant unwinds. GroupM and Red
Slide 10: Information, Insight & Consultancy
Third Quarter 2004 Information, Insight & Consultancy z Revenue growth of over 18% in the quarter, partly driven by impact of acquisitions. Like-for-like growth stronger than first half with growth in Millward Brown, Kantar Media Research, IMRB, Center Partners and Lightspeed. z MaPs acquired by Mil
Slide 11: Public Relations & Public Affairs
Third Quarter 2004 Public Relations & Public Affairs z Continued constant currency revenue growth of over 8%, similar to quarter two with like-for-like growth over 5%. z Particularly strong growth at Cohn & Wolfe and Penn Schoen Berland. z Dome acquisition in the United States completed by H&K. WPP
Slide 12: Branding & Identity, Healthcare and Specialist Communication
Third Quarter 2004 Branding & Identity, Healthcare and Specialist Communication z Constant currency revenue up over 13%, with strong like- for-like growth particularly at OgilvyOne, Wunderman, JWT Specialised and Healthcare. z Remaining interests in The Farm in the UK and 141 Romania acquired. WPP 1
Slide 13: Revenue Growth by Country – year to date
Third Quarter 2004 Revenue Growth by Country – year to date Revenue Growth Countries 15%+ Australia, Belgium, Brazil, China, Denmark, Hong Kong, India, Italy, Mexico, Singapore 10-15% Netherlands, Spain, Taiwan, UK, USA 5-10% - 0-5% Canada, France, Germany, Japan, Sweden < 0% - WPP 13
Slide 14: Revenue Growth by Category - year to date
Third Quarter 2004 Revenue Growth by Category - year to date Revenue Growth Categories 15%+ Electrical, Financial Services, Oil, Telecommunications 10-15% Personal Care & Drugs 5-10% Computer, Food, Retail 0-5% Automotive, Drinks < 0% - WPP 14
Slide 15: Impact of currency
Third Quarter 2004 Impact of currency z Third quarter revenues up almost 12% in constant currency and up almost 4% reportable, the difference being primarily due to the weakness of the dollar. z Year to date revenues up almost 13% in constant currency and up over 5% reportable. WPP 15
Slide 16: Major New Business Wins/Losses – First Nine Months (Wins)
Interim Results for 2004 Major New Business Wins/ Losses – First Nine months Agency Account Office Billings ($m)* Team HSBC HSBC Worldwide 600 Y&R Brands Microsoft Worldwide 300 Y&R Advertising Toys R Us USA 125 OgilvyOne IBM ¹ Worldwide 100 Berlin Cameron/Red Cell Safeway USA 95 Y&R Advertising MTN
Slide 17: Major New Business Wins/Losses – First Nine Months (Losses)
Interim Results for 2004 Major New Business Wins/ Losses – First Nine Months Agency Account Office Billings ($m)* Y&R Advertising Burger King Worldwide 250 Wunderman IBM ¹ Worldwide 100 Ogilvy GSK USA 100 LOSSES Ogilvy Schering Plough USA 85 Ogilvy Bristol Myers Squibb USA 70 Y&R Advertising Kraft ¹
Slide 18: Net new business wins in the first nine months of 2004
Third Quarter 2004 Net new business wins in the first nine months of 2004* US$ Millions Creative Media Total Advertising 729 1,824 2,553 Other Businesses 635 - 635 Total 1,364 1,824 3,188 * Billings WPP 18
Slide 19: Major New Business Wins – October so far
Third Quarter 2004 Major New Business Wins – October so far Agency Account Office Billings ($m)* MindShare Nestle Global 600 Mediaedge:cia Paramount USA 480 WINS Mediaedge:cia Toys R Us USA 130 Ogilvy/ MindShare Delta Airlines USA 50 JWT Unilever - Knorr Europe 32 Ogilvy Unilever – Slimfast 1 ' USA
Slide 20: Uses of Cashflow
Third Quarter 2004 Uses of Cashflow z Net debt at 30 September £847m against £1,140m at 30 September 2003, a decrease of £293m. z Average net debt for the first nine months £850m, compared to £1,348m last year (a decrease of £498m) and £1,168m in constant currency (a decrease of £318m). z 1.208 shar
Slide 21: Acquisitions
Third Quarter 2004 Acquisitions z Merger agreement for Grey announced on 13 September, expected to be completed by early 2005. z Continued focus on small and medium sized strategic acquisitions - a number completed during the quarter. z Major focus continues to be on information, insight and consult
Slide 22: Trading Statement October 2004
WPP Trading Statement Third Quarter 2004 October 2004 WPP 22