WPP share price: Ad giant sees record pre-tax profit in 2014

WPP Plc (LON:WPP) today reported an upbeat set of full year results, with strong performance across all regions. The world’s largest advertising company also noted that it had seen robust trading in January, indicating that it is set for further growth in 2015.

WPP’s 2014 revenue rose 4.6 percent on the previous year to £11.53 billion, which was slightly better than the £11.3-billion forecast of analysts surveyed by Bloomberg. Reported billings were up 6.8 percent on a constant currency basis at £46.2 billion. The company also reported record pre-tax profit of £1.45 billion, up 12 percent from 2013.
The advertising giant had a strong start to 2015, with like-for-like revenue increasing 6.7 percent in January. The company projected net sales growth of more than three percent this year and a headline operating margin target improvement of 0.3 percentage points, excluding the impact of currency movements. In an interview with the BBC, WPP’s chief executive officer Martin Sorrell hinted at signs of economic improvement in the eurozone.

“We are seeing a little bit of an improvement [in the eurozone] we saw a stronger Q4 and as we go into the first few months of this year January was stronger for the eurozone as well. So there are grounds for a little bit more optimism”, Sorrell said, as quoted by the BBC.
However, Sorrell also warned that the upcoming UK election contained risks to economic growth, regardless of which party wins the poll.

In today’s trading, WPP shares were up 0.1 percent at 1,542.95p, as of 09:12 UTC. The stock has risen nearly 15 percent since the start of the year.
According to the Financial Times, the 24 analysts offering 12 month price targets for WPP have a median target of 1,542.5p, with a high estimate of 1,742p and a low estimate of 1,250p. As of March 07, 2015, the consensus forecast amongst 38 polled investment analysts covering WPP has it that the company will outperform the market. This stance has been maintained since October 16, 2009, when the sentiment of investment analysts improved from “hold”.
As of 10:39 GMT, Monday, 09 March, WPP PLC ORD 10P share price is 1,548.00p.