WPP PLC (LSE:WPP) raised its full-year forecast yet again as the continuing recovery in the global advertising market boosted its third-quarter sales to above pre-pandemic 2019 levels.
The FTSE 100 advertising and marketing group said its key measure, like-for-like (LFL) revenue less pass-through costs, grew 15.7% in the three months to end-September compared with 2020. This beat forecasts of 9.7% and was 6.9% higher than the same period in 2019.
The group achieved strong sales in its main markets, with LFL revenue less pass-through costs rising 16.9% year-on-year in the UK, 12.4% in the US, 18% in China and 34.5% in Germany, where growth was boosted by a Coronavirus (COVID-19)-related contract.
Compared with 2019, the UK, US and German markets saw revenue growth of 9.3%, 6.2% and 32.1% respectively.
WPP raised its guidance yet again and now expects LFL revenue less pass-through costs to grow by 11.5%-12% in 2021, up from its August forecast of 9%-10%, which had been increased from a mid-single digit estimate.
New business won in the third quarter amounted to US$1.7bn, taking the year-to-date total to US$4.6bn.
Chief executive Mark Read commented: “Clients across all sectors and geographies are making significant investments in marketing, particularly in digital media and ecommerce services. We are now above 2019 levels in all of our business lines, and with the actions we have taken over the last three years, we are even better positioned for growth.
"Our reshaped offer - which combines creativity with technology and data, through Choreograph, with the largest global media platform in GroupM - is proving its value for existing and new clients. This is reflected in the continuation of our longstanding and successful partnership with Unilever, and the growth of our relationship with Bayer. In addition, we are delighted to have won new assignments with Beiersdorf, L'Oréal, Sainsbury's and TD Bank.
“With strong client demand, a clear strategic direction and a strong balance sheet, we are well positioned to continue our momentum into 2022 and beyond. Net debt stood at £1.6bn at the end of September, down £1bn year-on-year
The company also announced that it will purchase a further £200mln worth of shares under its continuing share buyback programme. So far this year it has bought back £448mln and will complete the £600mln programme by the year-end.
Shares were 5.1% higher at 1,015.50p in early trade.