WPP 2024 Preliminary Results

Strategic progress driving stronger margin and improved cash conversion, despite top line pressures

NEW YORK & LONDON--(BUSINESS WIRE)--February 27, 2025-- 

WPP $(WPP)$ today reported its 2024 Preliminary Results.

 
                                            +/(-) %  +/(-) % 
Key figures (GBPm)               2024   reported(1)   LFL(2)    2023 
----------------------------   ------  ------------  -------  ------ 
Revenue                        14,741         (0.7)      2.3  14,845 
-----------------------------  ------  ------------  -------  ------ 
Revenue less pass-through 
 costs                         11,359         (4.2)    (1.0)  11,860 
-----------------------------  ------  ------------  -------  ------ 
 
Reported: 
----------------------------   ------  ------------  -------  ------ 
Operating profit                1,325         149.5              531 
-----------------------------  ------  ------------  -------  ------ 
Operating profit margin(3)       9.0%                           3.6% 
-----------------------------  ------  ------------  -------  ------ 
Profit before tax               1,031         198.0              346 
-----------------------------  ------  ------------  -------  ------ 
Diluted EPS (p)                  49.4         389.1             10.1 
-----------------------------  ------  ------------  -------  ------ 
Dividends per share (p)         39.4*            --             39.4 
-----------------------------  ------  ------------  -------  ------ 
 
Headline(4) : 
----------------------------   ------  ------------  -------  ------ 
Operating profit                1,707         (2.5)      2.0   1,750 
-----------------------------  ------  ------------  -------  ------ 
Operating profit margin         15.0%         0.2pt    0.4pt   14.8% 
-----------------------------  ------  ------------  -------  ------ 
Diluted EPS (p)                  88.3         (5.9)      0.1    93.8 
-----------------------------  ------  ------------  -------  ------ 
*including proposed final 
 dividend. 
 

Full year and Q4 financial highlights

   -- 
 FY reported revenue -0.7%, LFL revenue +2.3%. FY revenue less 
      pass-through costs -4.2%, LFL revenue less pass-through costs -1.0% 
 
 
   -- 
 Q4 LFL revenue less pass-through costs -2.3% with growth in Western 
      Continental Europe +1.4% offset by declines in North America -1.4%, UK 
      -5.1% and Rest of World -4.8%, including -21.2% in China 
 
 
   -- 
 Global Integrated Agencies FY LFL revenue less pass-through costs -0.8% 
      (Q4: -2.2%): GroupM, our media planning and buying business, +2.7% (Q4: 
      +2.4%), offset by -3.9% in other Global Integrated Agencies (Q4: -6.5%) 
 
 
   -- 
 FY headline operating profit GBP1,707m. Headline operating margin of 
      15.0% (2023: 14.8%) a 0.4pt LFL improvement reflecting structural cost 
      savings of GBP85m from Burson, GroupM and VML initiatives; disciplined 
      cost control and continued investment in our AI and data offer; with a 
      0.2pt FX drag. FY reported operating profit GBP1,325m up 149.5% primarily 
      reflecting lower amortisation charges and higher gains on disposals 
 
 
   -- 
 Adjusted operating cash flow increased to GBP1,460m (2023: GBP1,280m) 
      and adjusted free cash flow rose to GBP738m (2023: GBP637m) benefiting 
      from strong working capital management 
 
 
   -- 
 Adjusted net debt at 31 December 2024 GBP1.7bn down GBP0.8bn 
      year-on-year 
 
 
   -- 
 Final dividend of 24.4p proposed (2023: 24.4p) 
 

Delivering on strategic priorities

   -- 
 Simpler client-facing structure: six agency networks represent c92%5 of 
      WPP; more integrated offer across creative, production, commerce and 
      media; improving new business performance in the second half of 2024 
 
 
   -- 
 WPP Open: AI, data and technology increasingly central to the way we 
      serve our clients; critical to new business wins including Amazon, J&J, 
      Kimberly-Clark and Unilever; increasing annual investment to GBP300m 
      (from GBP250m) 
 
 
   -- 
 More efficient operations: stronger headline operating margin, cash 
      conversion and balance sheet 
 

Focus and outlook for 2025

   -- 
 Lead through AI, data and technology: Increase our investment in WPP 
      Open to keep it at the forefront of AI and further deploy it across the 
      business and our clients 
 
 
   -- 
 Accelerate growth through the power of creative transformation: Drive 
      transformation across our clients with an increasingly integrated offer 
      across creative, production, commerce and media 
 
 
   -- 
 Build world-class, market-leading brands: Improve the competitiveness 
      of our media offer, globally, with a focus on the US 
 
 
   -- 
 Execute efficiently to drive financial returns: Increase our 
      operational efficiency and optimise our investment allocation 
 
 
   -- 
 2025 guidance: LFL revenue less pass-through costs of flat to -2% with 
      performance improving in the second half, and headline operating profit 
      margin expected to be around flat (excluding the impact of FX) 
 

Mark Read, Chief Executive Officer of WPP, said:

"We achieved significant progress against our strategy in 2024 with the creation of VML, Burson and the simplification of GroupM -- some 70% of our business. We sold our stake in FGS Global to create significant value for shareholders. And we increased our margin, while stepping up our investment in AI through WPP Open, which is now used by 33,000(6) people across WPP.

"The top line was lower, however, with Q4 impacted by weaker client discretionary spend. We did see growth from our top 25 clients of 2.0% and an improving new business performance in the second half of the year with wins from Amazon, J&J, Kimberly-Clark and Unilever reflecting the strength of our integrated offer.

"The actions we are taking across WPP will strengthen our existing client relationships and drive our new business results. We expect some improvement in the performance of our integrated creative agencies in the year ahead. At the same time, we have comprehensive efforts underway to improve our competitive positioning through new leadership at GroupM, with further investment in AI, data and proprietary media.

"Though we remain cautious given the overall macro environment, we are confident in our medium-term targets and believe our focus on innovation, a simpler client-facing offer and operational excellence will support our growth and deliver greater value for our shareholders."

This announcement contains information that qualifies or may qualify as inside information. The person responsible for arranging the release of this announcement on behalf of WPP plc is Balbir Kelly-Bisla, Company Secretary

To access WPP's 2024 preliminary results financial tables, please visit www.wpp.com/investors

Strategic progress

We are one year into executing on the strategy we outlined in January 2024 -- 'Innovating to Lead' -- and have made significant progress on each of the four strategic pillars: leading through AI, data and technology, accelerating growth through the power of creative transformation, building world-class brands and executing efficiently to drive financial returns.

Lead through AI, data and technology

The past year in AI has been marked by significant advancements in AI technology with increasing capabilities, greater speed and lower cost. This acceleration in the pace of innovation is broadening the capabilities that we can deploy through WPP Open.

These developments reinforce our conviction that AI will be the single most transformational development in our industry since the internet. It will impact every element of how we work, freeing up our creative people to do better work, increasing the efficiency of our production teams to produce much greater volumes of high-quality work and empowering our media teams to develop and deploy more effective plans in a fraction of the time.

To deliver on this potential, we are accelerating our investment in WPP Open, our AI-powered marketing operating system, increasing cash investment to GBP300m in 2025 from GBP250m in 2024. We are making this investment to keep WPP Open at the forefront of our industry, enabling us to use AI more effectively in our work and delivering an end-to-end marketing platform that gets from ideas to results more efficiently and quickly.

WPP Open is being broadly adopted by our people and our clients are seeing tangible benefits. It is enabling our teams to generate insights more rapidly, move seamlessly from idea to near-finished executions and test these ideas on synthetic audiences. These are just some of the capabilities built into WPP Open in the past year and why 33,000 of our people are now active users.

As our people are increasingly embedding AI in the way that we work this is resulting in increasing client adoption with major clients including Google, IBM, L'Oréal, LVMH, Nestlé and The Coca-Cola Company seeing benefits both in how we work and the effectiveness of what we do together.

WPP Open Creative Studio has been rolling out a new user interface, Canvas, which is augmenting our strategic and creative teams with AI capabilities. Canvas empowers teams to leverage data insights and WPP's knowledge to generate effective campaign ideas, such as strategies to overcome audience barriers identified by AI models, which can then be instantly visualised for clients as storyboards and finished work.

WPP Open Media Studio continued its rollout to clients and was central to our successful pitch at Amazon in 2024. Media Studio provides an end-to-end media workflow solution accessing GroupM's scale and Choreograph data and technology.

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