FOR IMMEDIATE RELEASE 5 August 2019
WPP PLC ("WPP")
Changes to business sector reporting structure
Further to the statement in its first quarter trading update on 26 April 2019 that it would review the appropriateness of its existing business sector reporting, WPP is today announcing the outcome of this review.
A key element of our strategy is to align our technology capabilities more closely with our creative expertise, and to simplify WPP through the creation of fewer, stronger, integrated agencies. As a result, a number of businesses currently reported within Public Relations & Public Affairs, and Brand Consulting, Health & Wellness and Specialist Communications, have been merged with entities within Advertising & Media Investment Management ("AMIM"). These include Wunderman, VML, Ogilvy PR and OgilvyOne. Additionally, the US healthcare companies have been re-aligned with strong agency partners within AMIM, and Burson Marsteller and Cohn & Wolfe have been merged to form Burson Cohn & Wolfe.
As a consequence of these moves, which reflect changes in the way we manage the business and report internally, we will report under the following sectors as from the 2019 interim results:
· Global Integrated Agencies: all of Ogilvy, VMLY&R, Wunderman Thompson, Grey, GroupM and Hogarth.
· Data Investment Management: the Kantar business.
· Public Relations: WPP's public relations specialists, as previously reported but excluding Ogilvy PR which now sits within Global Integrated Agencies as part of Ogilvy.
· Specialist Agencies: more specialised agencies, whether by region or range of services.
This change only affects the business sector reporting structure of the results; there is no change to the Group-level financial statements or the geographical segmentation.
Revenue and revenue less pass-through costs data for the four quarters of 2018 have been restated under the new business sector structure, and are available for download at www.wpp.com/investors/results-presentations-and-reports?page=1. A summary of half year and full year data for 2018, including headline operating profit and margin, under both historical and new business sector structures is presented below.
REVENUE
FIRST HALF
NEW SECTORS OLD SECTORS
£ million |
2018 |
reported |
constant |
LFL |
|
£ million |
2018 |
reported |
constant |
LFL |
Global Integrated Agencies |
4,756 |
-2.1% |
3.0% |
2.2% |
|
AMIM |
3,441 |
-3.6% |
1.1% |
2.2% |
Data Inv. Mgt.1 |
1,226 |
-5.6% |
-1.6% |
-1.9% |
|
Data Inv. Mgt. |
1,236 |
-5.9% |
-1.9% |
-2.2% |
Public Relations |
454 |
-0.2% |
5.8% |
5.5% |
|
PR & PA |
581 |
-2.7% |
3.0% |
3.7% |
Specialist Agencies |
1,057 |
1.5% |
6.6% |
1.7% |
|
BC, HW & SC |
2,235 |
3.0% |
8.7% |
2.4% |
Total Group |
7,493 |
-2.1% |
2.9% |
1.6% |
|
Total Group |
7,493 |
-2.1% |
2.9% |
1.6% |
FULL YEAR
NEW SECTORS OLD SECTORS
£ million |
2018 |
reported |
constant |
LFL |
|
£ million |
2018 |
reported |
constant |
LFL |
Global Integrated Agencies |
9,930 |
-1.0% |
1.9% |
1.4% |
|
AMIM |
7,132 |
-3.2% |
-0.4% |
1.0% |
Data Inv. Mgt.1 |
2,561 |
-4.3% |
-1.7% |
-1.7% |
|
Data Inv. Mgt. |
2,582 |
-4.5% |
-1.8% |
-2.0% |
Public Relations |
932 |
1.8% |
4.7% |
4.0% |
|
PR & PA |
1,211 |
0.6% |
3.4% |
3.1% |
Specialist Agencies |
2,179 |
-0.2% |
2.4% |
-0.1% |
|
BC, HW & SC |
4,677 |
3.3% |
6.3% |
1.5% |
Total Group |
15,602 |
-1.3% |
1.5% |
0.8% |
|
Total Group |
15,602 |
-1.3% |
1.5% |
0.8% |
1. Data Investment Management in 2018 now excludes £21m of revenue, £13m of revenue less pass-through costs and £8m of headline operating losses from businesses which are not part of the Kantar transaction. The significant majority of these businesses have been closed or sold as part of the ongoing restructuring.
REVENUE LESS PASS-THROUGH COSTS
FIRST HALF
NEW SECTORS OLD SECTORS
£ million |
2018 |
reported |
constant |
LFL |
|
£ million |
2018 |
reported |
constant |
LFL |
Global Integrated Agencies |
3,844 |
-4.5% |
0.5% |
0.2% |
|
AMIM |
2,639 |
-7.3% |
-2.8% |
-0.8% |
Data Inv. Mgt.1 |
940 |
-4.8% |
-0.5% |
-1.1% |
|
Data Inv. Mgt. |
946 |
-5.1% |
-0.8% |
-1.5% |
Public Relations |
430 |
0.1% |
6.0% |
5.9% |
|
PR & PA |
551 |
-3.0% |
2.6% |
3.5% |
Specialist Agencies |
935 |
0.2% |
5.4% |
0.1% |
|
BC, HW & SC |
2,013 |
2.5% |
8.4% |
1.9% |
Total Group |
6,149 |
-3.6% |
1.4% |
0.3% |
|
Total Group |
6,149 |
-3.6% |
1.4% |
0.3% |
FULL YEAR
NEW SECTORS OLD SECTORS
£ million |
2018 |
reported |
constant |
LFL |
|
£ million |
2018 |
reported |
constant |
LFL |
Global Integrated Agencies |
8,071 |
-2.9% |
-0.1% |
-0.3% |
|
AMIM |
5,530 |
-6.1% |
-3.3% |
-1.2% |
Data Inv. Mgt.1 |
1,953 |
-4.1% |
-1.2% |
-1.5% |
|
Data Inv. Mgt. |
1,966 |
-4.2% |
-1.3% |
-1.8% |
Public Relations |
880 |
1.8% |
4.7% |
4.0% |
|
PR & PA |
1,136 |
-0.4% |
2.5% |
2.6% |
Specialist Agencies |
1,923 |
-1.6% |
1.2% |
-1.5% |
|
BC, HW & SC |
4,195 |
2.6% |
5.6% |
0.6% |
Total Group |
12,827 |
-2.6% |
0.2% |
-0.4% |
|
Total Group |
12,827 |
-2.6% |
0.2% |
-0.4% |
1. Data Investment Management in 2018 now excludes £21m of revenue, £13m of revenue less pass-through costs and £8m of headline operating losses from businesses which are not part of the Kantar transaction. The significant majority of these businesses have been closed or sold as part of the ongoing restructuring.
HEADLINE OPERATING MARGINS
FIRST HALF
NEW SECTORS OLD SECTORS
£ million |
Revenue less pass-through costs |
Headline operating profit2 |
Headline operating profit margin |
|
£ million |
Revenue less pass-through costs |
Headline operating profit2 |
Headline operating profit margin |
Global Integrated Agencies |
3,844 |
485 |
12.6% |
|
AMIM |
2,639 |
370 |
14.0% |
Data Inv. Mgt.1 |
940 |
110 |
11.7% |
|
Data Inv. Mgt. |
946 |
106 |
11.2% |
Public Relations |
430 |
69 |
16.0% |
|
PR & PA |
551 |
84 |
15.3% |
Specialist Agencies |
935 |
119 |
12.7% |
|
BC, HW & SC |
2,013 |
223 |
11.0% |
Total Group |
6,149 |
783 |
12.7% |
|
Total Group |
6,149 |
783 |
12.7% |
FULL YEAR
NEW SECTORS OLD SECTORS
£ million |
Revenue less pass-through costs |
Headline operating profit2 |
Headline operating profit margin |
|
£ million |
Revenue less pass-through costs |
Headline operating profit2 |
Headline operating profit margin |
Global Integrated Agencies |
8,071 |
1,239 |
15.4% |
|
AMIM |
5,530 |
947 |
17.1% |
Data Inv. Mgt.1 |
1,953 |
296 |
15.2% |
|
Data Inv. Mgt. |
1,966 |
288 |
14.7% |
Public Relations |
880 |
141 |
16.0% |
|
PR & PA |
1,136 |
178 |
15.7% |
Specialist Agencies |
1,923 |
286 |
14.9% |
|
BC, HW & SC |
4,195 |
549 |
13.1% |
Total Group |
12,827 |
1,962 |
15.3% |
|
Total Group |
12,827 |
1,962 |
15.3% |
1. Data Investment Management in 2018 now excludes £21m of revenue, £13m of revenue less pass-through costs and £8m of headline operating losses from businesses which are not part of the Kantar transaction. The significant majority of these businesses have been closed or sold as part of the ongoing restructuring.
2. Headline operating profit is as defined in the 2018 Annual Report
For more information please contact:
Investors and analysts:
Peregrine Riviere +44 7909 907193
Lisa Hau +44 7824 496015
Fran Butera (US) +1 914 484 1198
Media:
Chris Wade +44 20 7282 4600
Kevin McCormack (US) +1 212 632 2239
Juliana Yeh (Asia) +852 2280 3790
Richard Oldworth, +44 20 7466 5000
Buchanan Communications +44 7710 130 634
