'We feel better about the environment' says WPP's Sorrell

WPP's chief executive Sir Martin Sorrell believes the worst of the financial downturn is over but cautioned that uncertainty about how the rest of the year will pan out remains in the more mature media markets of the world.

Speaking to on the day of , Sorrell was upbeat about the group’s recovery since it reported organic revenue falling through the floor a year before.

He said: "We feel better about the environment. There have been sequential improvements, except for a mild flutter in June, but it has improved again in July, and so I think we feel pretty good about the rest of the year."

WPP, home to agencies JWT, Grey and Ogilvy & Mather, as well GroupM, Kantar and TNS, also stated it does not expect the economy to enter into a "double-dip" recession, but warned that growth will be uneven and at varying speeds.

Sorrell admitted: "There are two areas of concern: the first is Eurozone uncertainty – contagion, and the second is what’s going to happen in the US in 2011, where there is a significant degree of uncertainty – tax cuts, the Obama administration’s attitudes to business and profits and taxation, health care costs increasing.

"So it’s a little bit of a twilight zone at the moment. A little bit of uncertainty. CEOs, I think, are generally being cautious. They don’t want to have a downward adjustment to expectations, so I think they are on the cautious side."

A WPP statement today stressed "a significant recovery in revenue growth and profitability" for the first seven months of 2010, with July showing the strongest growth of all, up almost 7%. 

It stated how the group's anticipated 'LUV' recovery for the world, relating to L-shaped in Western Europe, U-shaped in the United States and V-shaped in the Brics and Next 11, was evolving to more of an LVV-shape thanks to strong growth in North America. 

It said: "Whilst politicians, journalists, economists, analysts and investors argue about double-dips, inflation or deflation, the most likely scenario is a slow growth "slog", particularly in the mature geographical markets and traditional media markets, perhaps with inflation and higher interest rates in the long-term."

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