(Adds details, shares)
LONDON, Feb 27 (Reuters) - WPP, the world's biggest
advertising company, reported a sharp slowdown in its final
quarter of the year on Thursday and said it did not expect any
improvement in 2020, hammering its shares once again.
WPP, which is in the middle of a three-year turnaround plan
after it lost some major clients, reported a 1.9% drop in its
main measure of organic revenue minus pass-through costs after
recording 0.5% growth in the previous quarter.
Its shares fell more than 12% in early trading to their
lowest since Feb. 8 last year.
For 2020, it said it would target flat organic revenue and a
flat headline operating profit margin, which was 14.4% in 2019,
before growing in line with rivals by 2021.
"I am optimistic about the future of our industry and WPP's
position within it, although there is still much more work to
do," Chief Executive Mark Read said.
For its 2019 fiscal year, the company reported a 1.6% drop
in organic sales, which excluded its data business Kantar after
it sold a major stake in the division to Bain Capital.
WPP has endured a tough three years after losing major
clients such as Ford and American Express in the
United States. While its operating performance has started to
improve, its shares had already more than halved since March
2017 before Thursday's slide.
Read, a company veteran who took over from founder Martin
Sorrell in 2018, has merged agencies and changed incentive
schemes to provide a more streamlined service after clients
complained that WPP, which owns Ogilvy, Grey and Finsbury, had
become too unwieldy.
The sale of a 60% stake in Kantar for about $3.1 billion
helped the group to cut its debt significantly.
(Reporting by Kate Holton; Editing by Paul Sandle and David
Clarke)
WPP (WPP)
