World's biggest advertising giant WPP hit by Brexit worries

Sir Martin Sorrell’s firm talks about referendum jitters

World’s biggest advertising giant WPP has warned that the slump in global economies has left it “grinding out” for growth.

It reported pre-tax profit up 15.8% to £690m in the first half of the year.

While global revenues stood at £6.5bn in the first six months, like-for-like revenues in the UK grew by 3.5% in the second quarter to £475m.

Net sales were up from 3.2% in the first quarter to 3.4% in the second quarter in the UK.

“Whilst there seems limited likelihood of a worldwide recession, that is two quarters of negative GDP growth globally, there have been and will be individual countries that go into recession, as Russia and Brazil already have and a post-Brexit United Kingdom might,” said WPP.

“The United Kingdom was stronger than the previous quarter, perhaps reflecting a post-Brexit vote recovery, driven by a weaker pound sterling,” it added.

Roddy Davidson, an analyst at Shore Capital Markets, said: “We remain bullish on WPP’s ability to capitalise on a solid medium-term outlook for global advertising spend – particularly in view of its concerted efforts to build an overweight exposure versus its peers to digital disciplines and faster growing regions, which should also help cushion regional variations and short term volatility in advertising spend.”