Ad giant WPP sees profits sink amid restructuring costs
|bbc.com 01 Mar 2019 at 00:27|
Ad giant WPP has seen profits drop sharply as it continues to restructure the business following former boss Sir Martin Sorrell s abrupt exit last year.
Sir Martin quit after allegations of personal misconduct, which he denied.
Pre-tax profits at the firm fell almost a third last year to £1.46bn, a drop it blamed largely on restructuring costs.
WPP also reiterated 2019 would be "challenging, particularly in the first half" as client losses from last year continues to weigh on the business.
Despite the profit fall, the firm s performance was at the upper end of the guidance it provided last year, helping to boost its shares 9% in early trading.
Liberum analyst Ian Whittaker said last year s results were "slightly better than expected", but said the firm s commentary on 2019 was also more positive than expected.
New boss Mark Read said the firm was at the start of a "three-year turnaround plan".
"It s early days in what we need to do but I would say the initial signs are promising," he told Reuters.
The British firm - which owns major agencies such as Ogilvy and JWT - has been selling off assets to raise money. It said it had sold 36 divisions since last April, helping to strengthen its balance sheet.
Founded as a holding company in 1986, WPP s operations today span creative agencies, public relations, consultancy and data analytics.