WPP AUNZ full year profit slides with account losses in 'weak advertising' market

By Chris Pash | 24 February 2020
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  • WPP AUNZ full year net sales down 4.4% to $819.4 million. Continuing business net sales of $712.5 million, down 2.6%.
  • Headline profit down 9.6% to $51.19 million. Statutory net loss of $227.57million. 
  • Final dividend of 2.9 cents a share. A 1.5 cent fully franked special dividend.

WPP AUNZ, the Australian ASX-listed arm of the world's biggest advertising company, posted a full year statutory loss of $227.57 million with account losses in media and PR in a weak advertising and media market.

Headline profit was down 9.6% to $51.19 million. 

WPP AUNZ was hit by weaker spend in traditional media and creative agencies and by global and local account losses. 

The market welcomed the result. In early trade on the ASX, WPP AUNZ shares were up more than 8% to $0.625. 

Shareholders will get $50 million from the $158.7 million from the sale of data business Kantar in the form of a special dividend at 1.5 cents a share. 

CEO Jens Monsees, announcing a three-year plan to return to growth, says that in his first five months on the job he has been impressed by the capability and talent of people at WPP.

“We must now power up our creative capability and traditional skill-set with technology to capture growing areas of e-commerce, technology and experience," he says.

"As technology advances, the way consumers connect and communicate with brands is also evolving rapidly and that is why today we have announced a new strategy to simplify and scale our business and capture the new growth areas of the advertising, media and communications market." 

He says the path to growth will be in three phases - transform, strengthen, and grow - over three-yearsto 2022.

“This year is the transformation phase of our strategy," he says.

"Now two months into 2020, I can say we have already made meaningful progress in this phase by announcing a new leadership structure, a restructuring of our New Zealand business, added capabilities in technology through the acquisition of Dominion in New Zealand and announcing the establishment of our Centre of Excellence to consolidate the technology consulting operations of the Group. 

“Our team is intent on being a true partner of choice for our clients, creating a shared services platform, and attracting and retaining the best talent in the market.

“Key to our success will be relentless execution and creating avenues for growth. We have new solutions technology and data capabilities, and campuses to drive better client service and a strengthened geographic footprint into South-East Asia.

“We are confident in our ability to change gear and create a future of opportunity and success. No-one in our market is yet leading the future of consumer communication and that is where we want to be. We believe we are strongly placed with our creativity and technology capabilities to become the leading creative transformation business in Australia, New Zealand and South-East Asia.” 

Full year numbers:

wpp aunz 2019

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