Advertising giant WPP has reported heavy losses in annual profit and the company has warned challenging conditions will hit the first half of 2019.
The advertising giant posted a £1.46bn decline in their full year pre-tax profits for 2018 as revenue fell by £15.6bn and like-for-like sales fell by 0.4%.
WPP blamed restructuring and transformation costs for the impact, the total restructuring cost in 2018 was £302m. The company started restructuring following Sir Martin Sorrell’s abrupt exit in 2018, following allegations of personal misconduct which he denies.
The company lost several big-name companies such as Ford motor company as advertising is changing, which affected performance .
WPP are axing 3,500 jobs worldwide as the company plans to cut costs by £275m per annum, in a bid to turn the company around.
Mark Read, chief executive said, “As we have said previously, 2019 will be challenging, particularly in the first half due to headwinds from client losses in 2018.
“However, we start the year with fewer clients under review than we did in 2018, and investments in creativity and technology will further improve the competitiveness of our offer.”
Read added, “We are at the beginning of a three-year turnaround plan, but WPP’s new positioning as a creative transformation company with stronger, more integrated, more tech-enabled agencies is already proving effective, having driven several of our recent new business successes.”