WPP, the world's largest ad firm by sales, raised its key like-for-like full-year revenue forecast today to 2 per cent growth from a previous prediction of flat after a strong turnaround in the United States.
Adding to the signs of a global ad recovery following strong updates from rivals last week, WPP said the key organic sales figure had been flat in the first quarter, including March which was up 1 per cent, the first monthly revenue growth in 14 months.
However many analysts and investors were left uninspired as they had already expected a stronger full-year performance, and WPP's first quarter performance was still below that of its rivals.
Analysts were expecting an organic sales figure of 0.9 per cent, according to a Reuters poll, which had a range of 0 to 2.1 per cent.
Shares in the group, whose clients include Vodafone, Ford and Unilever, fluctuated between flat and down 0.4 per cent in early morning trading.
Analysts had originally expected WPP's organic sales to be slightly down for the first quarter, after they fell more than 8 per cent in 2009, but they revised their numbers after rivals Omnicom and Publicis posted improved trading.
French rival Publicis beat forecasts for its first-quarter sales last week, when it reported organic growth of 3.1 per cent.
Omnicom Group, which reported first quarter organic revenue up 2.1 per cent, said it had seen a stronger performance in the United States, Africa and the Middle East.
WPP also said it had seen a change in client attitudes, with the most marked turnaround in the United States, and chief executive Martin Sorrell said the forecasts could be conservative.
"This is what our businesses are forecasting, without us having gone through them and usually when we do go through them they tend to be on the conservative side," he said in a phone interview from Hong Kong.
"To make the point, in the first quarter we were three percent ahead of where we were budgeting."
The performance was boosted by the US market, which had first-quarter growth of 4 per cent on a constant currency basis, while Britain was positive and mainland China and India showed combined growth of over 5 per cent.
Reuters