WPP has surprised everybody, including possibly itself, by posting much better than expected revenue growth less pass-through costs (its version of organic growth) of 3.1% in Q1 2021, a sharp turnaround from negative 6.5% in Q4 2020.
The rise was driven by a strong performance in China (+18%) and the UK (+6.5%.) The US grew O.7%.
This puts WPP ahead of the rivals that have already reported: Publicis at +2.8%, Havas 0.8% and Omnicom -1.8%. Interpublic reports later today. A less favourable comparison would be with digital-first newbies S4 Capital (Sir Martin Sorrell’s new venture) and You & Mr Jones which both claim to be growing at 20% or thereabouts although they’re still much smaller.
WPP says the performance is “faster and stronger than we expected” and a quarter earlier. In revenue terms WPP is back to where it was in pre-pandemic Q1 2019.
Agency-wise, media operation GroupM grew 5.8% year on year with VMLY&R the best creative/digital performer. Ogilvy and AKQA (now incorporating Grey) are still negative although AKQA performed strongly in its home market the UK.
CEO Read (above) says: “Our strengths in ecommerce, digital media and technology, combined with our ongoing investment in creative talent, are resonating with clients as their markets recover and they seek to transform their offer for future growth.
“The roll-out of vaccines is improving visibility in many markets, although there is inevitably uncertainty over the pace of recovery. We are making good progress on our transformation programme, which will deliver significant efficiencies to reinvest in growth, and are confident of delivering our growth and profitability guidance for 2021.”