WPP 2024 Preliminary Results

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

NEW YORK & LONDON–(BUSINESS WIRE)–WPP (NYSE: WPP) today reported its 2024 Preliminary Results.

Key figures (£m)		2024		+/(-) % reported1		+/(-) % LFL2			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 margin3		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
Headline4:
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 £1,707m. Headline operating margin of 15.0% (2023: 14.8%) a 0.4pt LFL improvement reflecting structural cost savings of £85m 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 £1,325m up 149.5% primarily reflecting lower amortisation charges and higher gains on disposals
• Adjusted operating cash flow increased to £1,460m (2023: £1,280m) and adjusted free cash flow rose to £738m (2023: £637m) benefiting from strong working capital management
• Adjusted net debt at 31 December 2024 £1.7bn down £0.8bn 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 £300m (from £250m)
• 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 33,000⁶ 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 £300m in 2025 from £250m 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.

GroupM and Choreograph’s approach to data leverages AI-powered federated learning. Federated learning uses AI agents operating across client, WPP and third-party data sources to create new knowledge about customers. Establishing this data connectivity in place of a dependence on legacy ID-first solutions and lookalike models maintains data integrity and provides superior insight.

Accelerate growth through the power of creative transformation

We continue to see growing demand from clients for more integrated marketing solutions and WPP is moving quickly to be even more effective in bringing together our many capabilities around the world in teams to service clients. The reason for this is clear. Managing multiple agency partners is complex, leads to fragmentation of marketing efforts and smaller, more integrated teams promise greater agility and speed. In our view, AI will only accelerate this trend as clients face the challenge that complex agency rosters, spread across multiple companies and independent agencies, are unable to deliver the transformation required. The simplest analogy is that procuring marketing services is becoming more like procuring technology services, requiring greater strategic focus, technology due diligence and attention to long-term partnerships.

This trend has been reflected in the growth of WPP’s top 25 clients in 2024 (+2.0%) and this demand for integration also aligns with WPP’s position. We have a very well-balanced business with strong geographic positions in critical markets combined with strength in creativity, production commerce and influencer. When powered by AI, data and technology and a world-leading global media platform, this forms an unparalleled integrated offer to clients.

As well as the relatively stronger growth we delivered across WPP’s largest clients in 2024, which included expanded scope for many top clients, the quality of our offer is evidenced by recent wins including creative assignments for Kimberly-Clark, media assignments for Amazon and Johnson & Johnson, and creative and commerce assignments for Unilever. 2024 net new billings were $4.5bn (2023: $4.5bn).

WPP’s commitment to creative excellence continues to garner industry recognition, with the company being named ‘Creative Company of the Year’ for 2024 at the Cannes Lions International Festival of Creativity. Ogilvy took home ‘Creative Network of the Year’ at Cannes and The Coca-Cola Company, whose global marketing partner is WPP Open X, was named ‘Creative Brand of the Year’ for the first time in its history. These awards underscore WPP’s ability to deliver innovative, integrated solutions that not only meet but exceed client expectations, driving both growth and expansion from across its client base.

Build world-class, market-leading brands

In 2024, we further simplified our structure making it easier for clients to access our talent and allowing us to build a more efficient operating model. WPP now has six powerful agency networks – GroupM, VML, Ogilvy, AKQA, Hogarth and Burson – which collectively account for around 92% of revenue less pass-through costs.

2025 will be the first full year of operation for our two newly created agencies: Burson, a leading global strategic communications agency formed through the consolidation of BCW and Hill & Knowlton, and VML, the world’s largest integrated creative agency, bringing together VMLY&R and Wunderman Thompson. The swift completion of these mergers in 2024 by the teams at VML and Burson has strategically aligned our brands for continued progress, leveraging their enhanced capabilities and global reach.

Brian Lesser joined as the Global CEO of GroupM, our media planning and buying business, in September 2024, and is focused on improving the competitiveness of our media offer, globally and in the US, leveraging WPP Open Media Studio and Choreograph.

Under Brian’s leadership, GroupM will bring this differentiated strategy together with next-generation proprietary trading media products, WPP Open Media Studio and the power of WPP’s broader integrated offer in creative, production and commerce to drive media effectiveness and performance for our clients.

Execute efficiently to drive financial returns

Integral to our strategy over the past year has been the imperative to execute more efficiently. Investing in AI through WPP Open will allow us to work faster and with more discipline. Integrating our offer for clients means that we can streamline the marketing process and take out duplicate roles. As a simpler company, with fewer brands, we are able to maximise our investments in client-facing roles and take out unnecessary overhead.

As well as our success in delivering, at an accelerated pace, the structural cost savings relating to the agency mergers and GroupM simplification, we continue to make good progress in our back-office efficiency programme across enterprise IT, finance, procurement and real estate. This success is reflected in the improved margin and cash conversion in 2024.

In enterprise IT, we successfully rolled out Maconomy ERP in certain markets in EMEA and South America during 2024 and will go live with Workday ERP in VML and Ogilvy in the UK in the first half of 2025.

We have a targeted programme of work around our enterprise IT to continue to modernise our estate, drive efficiencies and protect our business and are making good progress with costs reducing year-on-year in 2024. Our cloud migration continued to deliver benefits as we migrate workloads to the cloud and decommission legacy equipment and capacity.

Across IT and Finance, we continue to optimise our finance shared service centres, offshoring more back-office processes and driving further automation and efficiencies in the work we do.

WPP is also investing in Global Delivery Centres (GDCs) with a capability hub headquartered in India, accessible to all WPP agency teams around the world. Our GDCs play a critical role in WPP’s business transformation and simplification strategy with capabilities from hyper-personalisation and composable commerce to cloud modernisation and product engineering. Prashant Mehta joined WPP in 2024 from Accenture as Managing Director to lead the GDCs.

Our category-led procurement model continues to consolidate spend by sub-category to drive further savings. We are digitalising our source-to-contract processes, enabling further automation as we consolidate our ERP landscape.

In real estate, our ongoing campus programme and consolidation of leases continues to deliver benefits. Seven new campuses opened during the year, including WPP’s third London campus at One Southwark Bridge and our third campus in India, located in Chennai.

During 2024 we made further progress on the simplification of our specialist agencies with the disposal of our stake in Two Circles, the integration of BSG with Burson and other actions to rationalise and improve the performance of the tail of smaller agencies within WPP.

Purpose and ESG

WPP’s purpose is to use the power of creativity to build better futures for our people, planet, clients and communities. Read more on the ways WPP is working to deliver against its purpose in our 2023 Sustainability Report.

Full year overview

Revenue was £14.7bn, down 0.7% from £14.8bn in 2023, and up 2.3% like-for-like. Revenue less pass-through costs was £11.4bn, down 4.2% from £11.9bn in 2023, and down 1.0% like-for-like.

		Q4 2024 £m		% reported		% M&A		% FX		% LFL
Revenue		3,956		(3.9)		(0.3)		(3.7)		0.1
Revenue less pass-through costs		2,994		(6.7)		(0.8)		(3.6)		(2.3)

		2024 £m		% reported		% M&A		% FX		% LFL
Revenue		14,741		(0.7)		0.2		(3.2)		2.3
Revenue less pass-through costs		11,359		(4.2)		(0.1)		(3.1)		(1.0)

Segmental review

Business segments – revenue less pass-through costs

% LFL +/(-)		Global Integrated Agencies				Public Relations				Specialist Agencies
Q4 2024		(2.2)				(5.3)				(0.4)
2024		(0.8)				(1.7)				(2.3)

Global Integrated Agencies: GroupM, our media planning and buying business, grew 2.7% in 2024 (2023: 4.9%), benefiting from continued client investment in media, partially offset by the impact of historical client losses and a more challenging environment in China. GroupM saw an improved new business performance in the second half of the year with the Amazon and J&J wins and an important Unilever retention, despite some losses, including Volvo.

GroupM’s growth was offset by a 3.9% LFL decline at other Global Integrated Agencies. Mid-single digit growth in Hogarth in 2024 was offset by weaker performance across integrated creative agencies, which included the impact of the 2023 loss of assignments with a large healthcare client and a challenging trading environment in China. AKQA experienced a low double digit decline in revenue less pass-through costs as spend on project-based work remained weak throughout the year. Other Global Integrated Agencies declined 6.5% in Q4 reflecting the continuation of those factors and weaker client discretionary spend than is typically seen in the final quarter, together with the lap of a particularly strong quarter for variable client incentives in Q4 2023.

Public Relations: Burson, created in June from the merger of BCW and Hill & Knowlton, made good progress with its integration and launched additional AI-powered tools.

During Q4, Burson declined high single digits as the business continued to be impacted by the 2023 loss of assignments with a large healthcare client and a more challenging environment for client discretionary spending. This was offset by continued strong growth at FGS Global, which is reflected up to early December 2024 when its disposal to KKR completed.

Specialist Agencies: CMI Media Group, our specialist healthcare media planning and buying agency, grew strongly, offset by declines at Landor and Design Bridge and Partners. Our smaller specialist agencies continued to be affected by more cautious client spending, including delays in project-based work.

Regional segments – revenue less pass-through costs

% LFL +/(-)		North America				United Kingdom				Western Continental Europe				Rest of World
Q4 2024		(1.4)				(5.1)				1.4				(4.8)
2024		(0.7)				(2.7)				1.7				(2.6)

North America declined by 0.7% in 2024 with good growth in automotive, TME and financial services client spending, offset by lower revenues in healthcare, due to a 2023 client loss, and a tough comparison for CPG in 2023. Revenues from technology clients continued to stabilise in the second half with good growth in North America in Q4.

The United Kingdom declined in 2024 reflecting a strong comparison (2023: +5.6%) and the impact of slower client spending in Q4 with further weakness in project-based work across creative and specialist agencies exacerbated by an uncertain macro outlook, only partially offset by growth in GroupM and Ogilvy.

In Western Continental Europe, France, Spain and Italy grew during 2024. Our largest market, Germany, declined 1.0% reflecting macro pressures on client spending in automotive and travel & leisure sectors, but saw stronger performance in Q4, growing 4.0%, lapping a softer comparison (Q4 2023: -5.3%), benefiting from growth in spend at financial services clients and a good overall performance at GroupM.

The Rest of World declined 2.6%. India grew 2.8% with a decline in Q4 lapping a tough comparison (Q4 2023: 22.0%) influenced by the timing of sporting events. This was offset by China which declined 20.8% on client assignment losses and persistent macroeconomic pressures impacting across our agencies.

The new management team in China is focused on stabilising performance and evolving our offer to bring together the best of our talent and capabilities and build on our leading market position.

We expect performance to continue to be challenging in China in the first half of 2025, with some improvement later in the year as we begin to lap easier comparisons from the second quarter onwards. We remain confident the actions we are taking in China will strengthen our business over the medium-term in what is an important strategic market for WPP.

Top five markets – revenue less pass-through costs

% LFL +/(-)		USA				UK				Germany				China				India
Q4 2024		(1.4)				(5.1)				4.0				(21.2)				(5.4)
2024		(0.6)				(2.7)				(1.0)				(20.8)				2.8

Client sector – revenue less pass-through costs

		Q4 2024 % LFL +/(-)		2024 % LFL +/(-)		2024 % share, revenue less pass-through costs†
CPG		(0.3)		5.1		28.4
Tech & Digital Services		2.5		(1.6)		17.3
Healthcare & Pharma		(3.1)		(7.2)		11.0
Automotive		(3.3)		1.3		10.4
Retail		(5.8)		(7.8)		8.8
Telecom, Media & Entertainment		4.6		3.7		6.9
Financial Services		5.8		3.1		6.3
Other		(13.3)		(14.8)		4.6
Travel & Leisure		(8.5)		1.7		3.6
Government, Public Sector & Non-profit		2.9		(1.4)		2.7
†. Proportion of WPP group revenue less pass-through costs in 2024; table made up of clients representing 79% of WPP total revenue less pass-through costs.

Financial results

Unaudited headline income statement^†:

£ million		2024			2023		+/(-) % reported		+/(-) % LFL
Revenue		14,741			14,845		(0.7)		2.3
Revenue less pass-through costs		11,359			11,860		(4.2)		(1.0)
Operating profit		1,707			1,750		(2.5)		2.0
Operating profit margin %		15.0%			14.8%		0.2pt*		0.4
Earnings from associates		40			37		8.1
PBIT		1,747			1,787		(2.2)
Net finance costs		(280)			(262)		(6.9)
Profit before taxation		1,467			1,525		(3.8)
Tax charge		(411)			(412)		0.2
Profit after taxation		1,056			1,113		(5.1)
Non-controlling interests		(87)			(87)		0.0
Profit attributable to shareholders		969			1,026		(5.6)
Diluted EPS		88.3p			93.8p		(5.9)		0.1
Reported:
Revenue		14,741			14,845		(0.7)
Operating profit		1,325			531		149.5
Profit before taxation		1,031			346		198.0
Diluted EPS		49.4p			10.1p		389.1
*margin points
†Non-GAAP measures in this table are reconciled in Appendix 4.

Operating profit

Headline operating profit was £1,707m (2023: £1,750m), with the year-on-year decline reflecting lower revenue less pass-through costs and investment in WPP Open, AI and data partially offset by continued cost discipline and structural cost savings. Headline operating profit margin was 15.0% (2023: 14.8%), equivalent to an improvement of 0.4 points on a constant currency basis.

Total headline operating costs were down 4.5%, to £9,652m (2023: £10,110m). Headline staff costs (excluding incentives) of £7,398m were down 4.5% compared to the prior period (2023: £7,750m), reflecting wage inflation offset by lower headcount, as a result of the actions associated with our restructuring initiatives and our swift response to softer top-line performance in certain markets. Incentives of £363m were down 6.2% compared to the prior period (2023: £387m). As a percentage of revenue less pass-though costs, overall incentives were flat year on year at 3.2%.

Headline establishment costs of £472m were down 8.5% compared to the prior period (2023: £516m) driven by benefits from the campus programme and consolidation of leases. IT costs of £684m (2023: £698m) were down 2.0%, reflecting our ongoing focus on driving efficiencies to mitigate inflation. Personal costs of £209m (2023: £223m) were down 6.3% driven by savings in travel and entertainment, and other operating expenses of £526m (2023: £536m) were down 1.9%.

On a like-for-like basis, the average number of people in the Group in 2024 was 111,281 compared to 114,732 in 2023. The total number of people as at 31 December 2024 was 108,044 compared to 114,173 as at 31 December 2023.

Headline EBITDA (including IFRS 16 depreciation) for the period was down by 2.1% to £1,935m (2023: £1,977m).

Reported operating profit was £1,325m (2023: £531m) with the increase primarily due to lower amortisation charges, as 2023 included accelerated brand amortisation charges following the creation of VML, lower property-related restructuring costs and higher gains on disposal of subsidiaries.

Contacts

Media
Chris Wade +44 20 7282 4600

Richard Oldworth, +44 7710 130 634

Burson Buchanan +44 20 7466 5000

[email protected]

Investors and analysts
Thomas Singlehurst, CFA +44 7876 431922

Anthony Hamilton +44 7464 532903

Caitlin Holt +44 7392 280178

[email protected]
wpp.com/investors

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