WPP lifts targets after first month of growth in a year

WPP, the marketing and communications giant, has seen its first monthly revenue growth in more than a year, thanks to a marked turnaround in the US market.

Revenues in the first quarter were flat at 2.1 billion, but rose 1 per cent in March – the first year-on-year growth since December 2008.

The group raised its revenue growth targets for the full year to 2 per cent on a like-for-like basis after previously suggesting turnover would be flat.

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It said profits and operating margins had been "well above" budget.

Shares in WPP, which owns famous names such as Ogilvy & Mather and J Walter Thompson, closed the day up almost 1 per cent at 698p as investors cheered further signs of a revival in the embattled advertising and communications industry.

The group said it had seen a "change in client attitudes" since the start of 2010, with companies focused on how to achieve profits rather than just cutting jobs.

US markets have seen the biggest revival, WPP noted, adding that economic and fiscal stimulus efforts seemed to have had the "most marked effect" in the United States. Revenues there recovered first, up 4 per cent with exchange rates stripped out, followed by the UK, which also registered revenue growth.

Overall, the group – headed by chief executive Sir Martin Sorrell – said new business billings were "up strongly" at 1.07 billion.

It believed the second quarter should continue the improving trend seen in the first, helped by easier comparatives from a year earlier, when sales fell by about 11 per cent.

The firm said in a statement: "Revenue stabilisation and growth have certainly come earlier than expected in 2010, as we originally thought growth would only come in the second quarter."

It is hoping key events such as the forthcoming World Cup will further boost advertising opportunities this year.

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The recent Winter Olympic Games in Vancouver provided a new year fillip for advertisers, while WPP pointed to other events on the industry calendar, including the Asian Games in Guangzhou and the World Expo in Shanghai.