WPP in reverse after it loses Ford ad contract

SHARES in WPP stuttered after it lost a prestigious contract with Ford Motor Company.

The advertising group’s stock slumped 1.4pc, or 15p, to 1095p after the US car maker appointed Omnicom Group’s BBDO as its lead advertising partner.

It was a major blow to boss Mark Read, who took over from founder Sir Martin Sorrell after he was ousted amid allegations he paid a prostitute with company money.

Sorrell, who has since set up competitor S4 Capital, has maintained that the allegations which led to his departure are untrue.

FTSE 100-listed WPP had worked with Ford for more than 70 years. The future of the contract was being closely watched by investors and analysts, who were using it as a bellwether of client sentiment following the departure of WPP’s totemic head.

Ford said it would retain WPP for ‘activation’, including media planning and buying and digital work, but that the new arrangement would save the car maker £114m per year. Analysts at Liberum said while the contract loss was a ‘blow to prestige’ for WPP, ‘the actual financial impact from the loss is limited’.

They added the work would have probably been low margin, since it was creative, and the loss of business would allow WPP to bid ‘more aggressively for other motor contracts’. Gambling firm Paddy Power

Betfair also took a hit after Ireland’s finance minister Paschal Donohoe announced plans to double the country’s tax on betting to 2pc.

Shares dipped 5pc, or 325p, to 6175p as Sharon Byrne, a spokesman for the Irish Bookmakers Association, said the increase would ‘kill the industry’. Despite the weighty falls, the FTSE100 index edged up 0.06pc, or 4.26 points, to 7237.59 points.

The index recovered slightly after hitting a six-month low in the early afternoon, following the International Monetary Fund’s announcement that it had slashed global growth forecasts.

Among the FTSE’s smaller companies, Kin & Carta – the business formerly known as St Ives – proved it still had some work to do in convincing investors of its new strategy. Shares in the business, which was once a printing firm but is now moving into digital marketing, dipped 4pc, or 4p, to 97p as it released full-year results and an update on its strategy.

Even though revenue was up 9pc to £178.4m, and profit before tax climbed 38pc to £18.5m, shareholders seemed unconvinced by chief executive J Schwan’s assertion that ‘the future for Kin & Carta is very bright’.

Investors ridiculed the company last week when it rebranded, saying the name made it sound ‘like a folk duo’. Shares have slipped 5.7pc since the unveiling.

On London’s junior market, pollster You Gov slipped – even though it hiked its dividend after profits rose 49pc to £11.8m.

The firm, which boasted of its ability to analyse data in real-time as it is collected, said dividends would rise 50pc to 3p per share.

Analysts at Berenberg have previously described You Gov as ‘misunderstood’, claiming that many observers don’t realise that the business does much more than conduct general election polls.

And the firm’s chief executive Stephan Shakespeare added that the firm was breaking ‘new ground in our industry’. But shares edged down by 1.3pc, or 6p, to 466p.

Law firm Knights, one of the handful in its industry to have listed on the public markets, made its first deal since floating on the London Stock Exchange as it scooped up Spearing Waite.

Knights (down 0.25pc, or 0.49p, to 197p) paid £5.3m for Leicester’s biggest law firm, which will rebrand as Knights in January.