Ad giant WPP has seen first-half revenues rise 6% to £4.7bn, with digital sales accounting for 27% of that figure.
Despite the economic gloom across global markets, CEO Martin Sorrel remains upbeat is sticking with his prediction that the rest of the year should see similar growth.
In the first six months, direct and digitally-related activities accounted for 27% of the group’s total revenues, or $2.1bn (£1.27bn) per annum.
WPP said its target is to make this up to 40% of total group revenue within four years.
Commenting on the half-year results, Sorrel said: “So far, so good for 2011. But there are storm clouds and we have yet to see how the latest stock market crisis affects consumer and client thinking and action. August is always a slow month in the markets and volumes are down. Corporates are getting ugly by cutting costs and reducing their balance sheets.
“I can’t see as a result of what has happened over the last four or five weeks that they are going to dramatically increase their marketing spend. Are consumers going to come back from their holidays and buy a new car or washing machine? No.”
WPP’s headline pre-tax profit rose 17% to £417 million, which was at the top end of forecasts, and the interim dividend is being hiked by a healthy 25% to 7.46p a share. The shares gained 18p to 598p.
Sorrell said plans and budgets for 2012 would be made “on a conservative basis” despite the fact it is a maxi-quadrennial year with the US Presidential election, Olympics, Paralympics and UEFA European Championship, which together should add 1% to 2% to global advertising spend.
He still plans to return WPP’s headquarters to the UK from Dublin, where it moved for tax reasons in 2008, but not yet: “The Government is still consulting on the legislation,2 he said. “Assuming they bring it in as they said they would we will come back. That has to be put to shareholders and I suspect it would not become operative until 2013.”
