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WPP group plc ad revenue tanks 6%

April 28, 2009

We are having a good time to see how the media is spinning the WPP group plc financial statement. An article on Yahoo says “Revenue Jumped 36%” as the headline, however forgetting to mention the crushing debt that was needed to purchase the firms to increase revenue… sort of like taking a loan with a 6% intrest rate of $100 dollars to get an additional $3 dollars a year in revenue…

there is no way about it, their like-to-like revenue has crashed 6% and the debt payments most likely will increase pressure on the company to continue “cost cutting” — IE: layoffs.

Don’t believe us, here is their complete revenue sheet.

sinking_ship

Written by TheFounder · Filed Under Advertising Agency News 


Comments

  • art blizzard
    I say Martin is on his last year with WPP! He will experience the same seperation as imposed upon the Saatchi brothers.
  • art blizzard
    Just read the revenue report - no mention of Dell or Enfatico. Interesting to see it's not germane to their revenue stream.
  • Isau Hispansaroff
    Isn't this just another type of Ponzi scheme?

    The company borrows money to 'buy revenue' (high interest-bearing to, non-accretive deals) hoping that the next quarter's revenue story ("up 35.9%") will keep attracting new investors and lenders.

    The problem is that WPP has no real understanding of how to make their under-performing core assets (Ogilvy, JWT, Y&R, etc) perform. The only growth strategy they know is through financial engineering.

    One good thing about a recession is that it increases visibility into the true value of highly pumped investment stories.

    I smell an implosion. Anyone want to start a count-down clock? 12 months? 18?
  • That's exactly what it is Isau Hispansaroff! I built a countdown clock for Enfatico, http://countdown.tribbleagency.com ... and I might be building on for WPP itself at this rate.
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