Media

WPP sees signs of Brexit uncertainty as sales growth slows

World’s largest advertising group says UK market a ‘little bit softer’ since June vote

Signage outside the WPP offices in London, as the advertising giant said the first signs of “Brexit anxiety” were beginning to show as the firm reported slower sales growth in Britain. Photograph: Chris Radburn/PA Wire
Signage outside the WPP offices in London, as the advertising giant said the first signs of “Brexit anxiety” were beginning to show as the firm reported slower sales growth in Britain. Photograph: Chris Radburn/PA Wire
Mon Oct 31 2016 - 08:27

WPP, the world's largest advertising group, reported a slowdown in organic net sales growth in the third quarter to 2.8 per cent, saying a weaker performance in Britain perhaps reflects the first impact of Brexit uncertainties.

Chief executive Martin Sorrell said the British market was a “little bit softer, maybe reflecting some of the uncertainty around Brexit” in the quarter.

WPP nudged down its forecast for the year, saying both like-for-like revenue and net sales for the year would grow by “over 3 per cent”, a slightly more cautious outlook than the “well over 3 per cent” it was predicting in August.

The US market was continuing to be “pretty strong”, Sorrell said, with the forthcoming presidential election having only a small impact on the ad market.

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“The bump from it is small in the context of the overall operations, neither one way or the other,” he said in an interview on Monday. “The bigger issue is what happens long term.”

WPP’s growth beat a forecast from Goldman Sachs, who were predicting organic growth of 2.6 per cent, reflecting softer ad trends reported by other media companies.

Third-quarter underlying sales for Publicis grew by just 0.2 per cent after it lost a number of large US media accounts in 2015.

US rival Omnicom said its outlook was clouded by the presidential election, the increased likelihood of a US interest rate rise before the year-end and the potential effects of Brexit. –(Reuters)