MARKETING GIANT WILL PAY DIVIDEND
THE world’s biggest advertising and marketing agency WPP will pay a dividend of 10 pence per share to investors, despite revenues plunging due to the coronavirus pandemic.
The British firm said it had resumed dividend payments as a sign of confidence after cost cuts and a switch to faster ad production helped it to beat dire forecasts for its second-quarter trading.
It posted a 15.1% fall in underlying net sales, compared to the anticipated 20%.
The firm reported a 12.3% drop in revenue in the first half of the year, down from £6.4billion during the same period in 2019 to £5.6bn.
Profit fell sharply from £617million to £382m and WPP suffered a headline £2.45bn loss after it wrote down the value of assets.
The advertising giant said it had won an industry-leading level of new work during the first half of 2020 at more than £3bn from clients including Intel, HSBC and Unilever, and trading in July showed some improvement with net sales down 9.2%.
Chief executive Mark Read said: “Assuming there is no second wave nor major lockdowns, the second quarter is expected to be the toughest period of the year, although we remain cautious on the speed of recovery.”
WPP expects its full-year outcome to be within current analysts’ expectations of a 10% to 11.5% decline.
Read added: “We are working with our clients to help them get back to business, adapt their marketing strategies at speed and reshape their operations for a new world. Brands are seeing increases in online sales of 100% and more, and we are supporting eight of our top 10 clients on e-commerce strategies.”
Rolls-Royce has reported record losses of £5.4billion for the first six months of 2020. It said 4,000 jobs have been cut since May – with 5,000 more set to go in the UK and worldwide by the end of the year in the firm’s biggest shake-up of its civil aerospace arm. It aims to offload parts of the business to raise at least £2billion to boost its balance sheet and has earmarked its ITP Aero division in Spain for sale.
The boss of the firm behind Paddy Power and Betfair has said he does not plan to close any betting shops or cut staff in the UK as a result of the pandemic.
Flutter Entertainment chief executive Peter Jackson said that bookies and their employees are safe, even though pre-tax profit had fallen 70% to £24million during the first six months of 2020. The firm said the second half of the year has been “encouraging” so far as footfall returned to the sporting calendar but pointed out that the outlook for businesses is still “highly uncertain”.