WPP revenue continues to slip in North America

The holding company noted that although organic revenue is down, the rate of that decrease is slowing.
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Holding co WPP has announced its earnings for Q2 and the first half of 2019, indicating that revenue continues to decline for the media and communications giant.

WPP owns and operates creative agencies including Wunderman Thompson, Ogilvy, Geometry, Grey, Taxi and John St., among others, as well as the GroupM family of media agencies.

In Q2, like-for-like revenue less pass-through costs was down 1.4%, which it noted is an improvement on the Q1 slowdown of 2.8%. In North America specifically, that revenue was down 5.3%, although that was an improvement from the 8.5% decrease in Q1.

In total, WPP brought in 7.6 billion (approximately CAD $12.2 billion*) for the first half of the year. Of that, £2.2 billion ($3.4 billion) came from North America. While WPP did not disclose specific revenue for Canada, it did classify Canada as being among the countries that saw “less than 0%” growth for the first half of the year, along with Mainland and Greater China, the U.S., France and others.

In terms of business driving revenue, government accounts were the only part of the business that saw more than 10% growth for the first half of the year. Tech, food, retail and communications saw between 0 and 10%, and all other categories saw “less than 0%.”

Key North American media wins include Signet (MediaCom, approximately US $360 million in billings) and Newell Brands (Mindshare, US $40 million). Since July 1, MediaCom has also picked up North American (and Chinese) business for eBay, an estimated US $250 million in billings.

It did not post any key North American creative wins, but global wins included Duracell (Wunderman Thompson, US $100 million).

The U.S. is still WPP’s top region for headcount (Canada is not among its top-five), although headcount decreased in three of the company’s top-five markets during Q2 (down 5.4% in the U.S., 5% in Germany and 8.7% in Greater China). Last year, WPP announced a three-year restructuring plan that would include cutting staff and offices in order to simplify its structure. In 2021, WPP also plans to bring all of its staff in Toronto together under one roof as the main tenant of the city’s Waterfront Innovation Centre.

*All currency conversions as of Aug. 9.

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