British advertising and marketing group WPP has announced a sharp fall in profits and warned it might not see a significant recovery in its markets until 2004.
Pre-tax profit excluding goodwill and asset write-downs fell by 17 per cent to £210 million sterling in the six months to June from the year-earlier period.
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After goodwill amortisation and impairment charges resulting from writing down the value of assets on the group's balance sheet, pre-tax profit fell by 30 per cent to £173.7 million. Revenue fell by 2 per cent to £1.96 billion.
"It has become apparent that any significant improvement could be delayed still further and that even improvements in comparative performance could be relatively mild," WPP said in a statement.
"It seems unlikely that significantly improved performance will occur in 2002 and that any recovery will have to await 2003 or, perhaps, even more likely 2004, when the US presidential election and the Athens Olympics will begin to have a positive effect, at least on media markets," it said.
It said matching last year's operating margins of 14 per cent in 2002 would therefore be difficult.
AFP