Kiss and Punch by WPP

Kiss and Punch –

Forbes_2000In 2007 WPP reported a pretax profit of $1.4 billion on revenue of $12.3 billion, up 8% in constant currencies. (That revenue puts it behind only Omnicom, at $12.7 billion, in its industry.) WPP’s operating (roughly speaking, Ebitda) margin has improved steadily to 15%, and in the last quarter of the year WPP stunned rivals Omnicom, Publicis, IPG and Havas by announcing record-smashing account wins with AT&Tand Dell. Total billings last year: $63 billion. Over the past decade the company’s earnings per share have been climbing at an 11% annualrate.

The globe spends $700 billion a year on advertising.

WPP is well ahead of its competitors in cracking Asia; the firm identified 1,200 potential acquisitions in China. Miles Young, chairman of Ogilvy & Mather Asia Pacific, says WPP cherry-picked 18 acquisitions in greater China (includes Taiwan) these last four years. WPP is the biggest ad firm in greater China (36% of total billings), India (56%) and Thailand (39%).

Last year the Internet accounted for 7.5% of the total $151 billion spent on advertising in the U.S. But Americans are spending some 25% of their news and entertainment time on the Web. The ad spending will catch up. Digitally focused firms accounted for 12% of WPP’s total revenues in 2007.


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