WPP set to report profit rise but warns UK remains tough

LONDON - WPP Group is expected to post a strong rise in profits this week, but chief executive Sir Martin Sorrell will warn that the UK ad market remains tough.

According to reports ahead of the company's half-year results on Friday, Sorrell is expected to say that there is strong growth in Asia and Eastern Europe, and that he is cautiously optimistic about global growth over the next two years.

At its annual general meeting in June, WPP said that the UK remained its slowest-growing market. It reported overall revenue growth of 17% for the first half of the year, but organic growth of only 4.5%, compared with the 5% that had been expected.

Analysts believe that revenues will have been boosted by the World Cup, which ran over June and July. The Sunday Telegraph reports that it is expected to post pre-tax profits of 拢350m, up from 拢255m, and a rise in revenues from 拢2.5bn to 拢2.75bn.

The newspaper also reports that Sorrell could use the results announcement to repeat his desire to acquire the Aegis Group-owned market research group Synovate.

Aegis has only recently emerged from a scrap with French businessman Vincent Bollore, chairman of Havas. Bollore had wanted to put two of his allies on the Aegis board, having acquired around 28% of its stock. However, this move was resisted by shareholders.

It is unlikely that Sorrell will move without Bollore, whose interest in acquiring control of Aegis remains.

Shares in WPP were up by 0.5% this morning to 622p, a rise of 3p, following an increase of 10p over the last week.

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