WPP turns a profit after stinging 2020 loss but its share price falls sharply as the impact of Russia’s invasion of Ukraine looms
- WPP’s returned to a profit in 2021 after slumping to huge loss in 2020
- Group’s share price fell sharply – but WPP boss maintains upbeat 2022 outlook
Shares in WPP have fallen sharply today despite the group’s upbeat preliminary annual results and optimism about its financial fortunes in the year ahead.
The advertising group’s latest financial update has been overshadowed by Russia’s invasion of Ukraine, where WPP has around 200 staff.
Boss Mark Read said the group was ‘very concerned’ about he crisis in Ukraine, but maintained that WPP’s revenue could still rise by around 5 per cent on a like-for-like basis this year.
Impact: Shares in WPP have fallen sharply today despite the group’s upbeat preliminary annual results
Shares in the FTSE 100-listed group have dropped, and were down 12.11 per cent or 142.50p to 1,034.00p this afternoon.
WPP reported a pre-tax annual profit of £951million today, against a loss of £2.8billion in 2020.
Net revenue increased 12.1 per cent to £10.4billion on a like-for-like basis, representing its fastest organic growth in two decades.
WPP said its performance in the pharmaceutical, healthcare, technology and consumer packaged goods sectors had been particularly strong over the past year.
The London-based firm signed deals with Google and Coca-Cola in the last year and won work from clients like AstraZeneca, Sainsbury’s and L’Oreal.
The group thinks advertising spend by companies will remain strong, despite mounting geopolitical uncertainty.
CEO Read said: ‘It has been an outstanding year for WPP.
‘Our top-line growth, driven by strong demand for our services in digital marketing, media, ecommerce and technology, has resulted in our fastest organic growth for over 20 years.
‘As a result, we are two years ahead of our plan, hitting our 2023 revenue target in 2021.’
He added: ‘We look forward to 2022 with confidence. We are guiding to strong top-line growth, improving profitability and continued investment in our people and services.’
The Martin Sorrell founded group, which employs more than 100,000 people, has been on a mission to turn its financial fortunes around after being hit hard the pandemic.
WPP said its turnaround plans were on track, and added that it had saved around £245million from across property procurement, improving IT and sharing certain services.