Arun Sudhaman 26 Apr 2012 // 11:00PM GMT
LONDON--WPP, the holding group that owns Burson-Marsteller, Ogilvy PR and Hill + Knowlton Strategies, has reported that PR and public affairs revenues rose by just 1.9 percent in the first quarter of 2012.
That figure, based on a like-for-like comparison with results one year earlier, takes PR and PA earnings to £225m, accounting for 9.4 percent of overall revenues.
The group praised Burson-Marsteller and Cohn & Wolfe for showing the “strongest growth”, but noted a softer performance in North America. Instead, there was "strong growth in Asia-Pacific, Latin America, the
United Kingdom and Africa."
In constant currency terms, PR revenues increased by 6.8 percent, which included acquisitions and increased equity stakes in the US, UK, Finland and Russia.
Overall, revenues grew by four percent on a like-for-like basis, with gross margin growing by the same proportion.
The group’s forecast for 2012 remains cautious, but notes that the three maxi-quadrennial events - the UEFA Football Championships, the Summer Olympics and Paralympics in London, and the US presidential elections - "should underpin industry growth by one percent alone this year."
“One of the clouds on the horizon, may, however be 2013,” added WPP chief executive Sir Martin Sorrell. “There will be no maxi- or mini- quadrennial events in that year. It now seems more likely that President Obama will be re-elected and will have to confront the intimidating US budget deficit, whilst dealing with a Republican-controlled House of Representatives and/or Senate. Legislative gridlock may continue at a time when kicking the can down the road may no longer be viable and bond markets may strike.”