Arun Sudhaman 01 Mar 2013 // 12:00AM GMT
LONDON--WPP Group, which owns Burson-Marsteller, Hill + Knowlton Strategies and Ogilvy PR, saw revenue and profit from its PR and public affairs firms decline in 2012.
On a like-for-like basis, PR and public affairs revenue dropped by one percent to £917m, accounting for 8.8 percent of the group's overall earnings. On a constant currency basis, once acquisitions are factored in, PR revenue grew by 4.2 percent.
PR and public affairs performance was outstripped by all of WPP's other units, with particularly strong growth recorded by the group's advertising, media investment and specialist comms agencies.
The PR revenue decline was not offset by improved profitability. The group's PR and public affairs margin in 2012 was 14.9 percent compared to 16.1 percent in 2011, with operating profit decreasing to £136m from £143m in 2011.
The group called 2012 a "difficult year" for its PR and public affairs firms, "with continuing pressure in North America and Continental Europe across most of the Group’s brands, only partly offset by strong growth in the United Kingdom, Latin America and the Middle East and Africa."
WPP also noted that, in contrast to its other business units, PR and public affairs revenues were not up in January 2013.
Overall, though, the group submitted encouraging 2012 results, with revenues up 3.5 percent to £10.4bn and operating margin up 0.5 points to 14.8 percent.