LONDON—WPP's PR firms continued to underperform in the third quarter of 2013, with revenues from the unit dropping by 0.9 percent to £229m.
The "relatively weak" PR performance, as WPP put it, was "less worse" than the first half of this year, when its PR firms reported a 3.6 percent decline. For the first nine months of this year, WPP's PR revenue has dropped by 2.7 percent.
CEO Sir Martin Sorrell expects PR revenues to return to growth in the fourth quarter of this year, after a "marked improvement" from North America, Western Continental Europe and Asia-Pacific.
Once again, the group's PR firms — which include Burson-Marsteller, Hill+Knowlton Strategies and Ogilvy PR — lagged its other units, such as advertising, data and digital, all of which grew.
That pattern, which has persisted at WPP for several quarters, helped the group beat investor expectations and record overall revenue growth of five percent during the quarter.
It will again prompt questions as to why WPP's PR firms are underperforming the market, particularly after Interpublic and Omnicom PR firms have submitted encouraging recent results. WPP's PR earnings accounted for 8.5 percent of overall income during the quarter, compared to 9.1 percent one year earlier.
"Early indications are that revenues in the final quarter of the year will grow at a similar rate to the first nine months, with an improvement in Asia Pacific, offset by a slower growth rate in the United Kingdom and Western Continental Europe," said Sorrell. "Functionally, all business sectors, except public relations and public affairs, are forecast to grow at a similar rate to the first nine months."