WPP reviewing structure as results boost shares
london — Mark Read, tasked with running WPP after the sudden exit of founder Martin Sorrell, said he would look at restructuring the world’s biggest advertising group but ruled out a break up.
Digital boss Read, appointed joint chief operating officer alongside acquisitions specialist Andrew Scott, said on Monday the company had the tools to respond in an industry facing lower customer spending and technological upheaval.
Quarterly sales were not as bad as feared, boosting WPP shares as much as 9 per cent and easing some of the investor pressure on the owner of ad agencies JWT and Ogilvy & Mather.
Analysts have speculated that WPP could sell its underperforming market research arm Kantar as an initial step to start to unwind the empire built up by Sorrell over more than three decades.
Scott said the group would definitely look at disposing some minority assets it holds.
Read, who was previously on the board for nine years, was speaking as the group reported first-quarter trading figures. Organic net sales slipped only 0.1 per cent — compared with a 1 per cent drop that analysts had forecast.
The share jump meant the WPP stock was on course for its best single gain ever and has now regained the losses it incurred when it announced Sorrell’s departure on April 14.
“We are not complacent about what we need to do and we recognise that we need to get the topline growing more quickly,” Read told Reuters in an interview.
“There are structural shifts in the industry and we need to have more of a structural response, (but) we are an industry in structural change, not structural decline.”
WPP, which provides advertising, data and market research to the likes of Ford, Unilever and Vodafone through its 200,000 staff in 112 countries, has been rocked this month by the departure of its founder who launched the company 33 years ago.