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global marketing communications giant wpp The company has once again slashed its annual outlook after new boss Cindy Rose admitted the company’s recent performance was “unacceptable”.
The group said it now expected full-year like-for-like underlying revenue to decline by 5.5% to 6%, having previously guided for a decline of 3% to 5%, while it also cut its profitability guidance.
This resulted from a larger-than-expected decline in underlying like-for-like revenues in the third quarter of 5.9% or 11.1% lower on a reported basis.
The alert – which came after it cut its sales outlook in July – saw the company’s shares fall more than 13% at one stage in early trading on Thursday.
East Microsoft UK chief Ms Rose, who took over from former chief executive Mark Reid early last month, said the change was being approached in conjunction with a strategic review.
“I accept that our recent performance is unacceptable and we are taking action to address it,” she said.
“There is still much to do, and it will take time to see the impact, but in my first 60 days we are moving forward with some initiatives already announced and more to come.”
WPP revealed in July that it had cut its workforce by almost 4,000 since the start of the year, as its profits fell to £98 million in the six months to June 30, from £338 million a year earlier.
lost the job The focus was largely on its WPP media business, while it also moved to reduce its workforce through natural staff turnover to cut costs in difficult trading conditions.
Ms Rose said recovery plans would include “simplifying how we organize ourselves internally as well as building a high-performance team culture”, with a particular focus on cost efficiency and a renewed emphasis on artificial intelligence (AI).
She is already making radical changes to her senior team line-up, as well as deepening ties with Google To promote the offering of AI technology.
More The company said its strategic rethink would be announced early in the new year.
WPP – which owns agencies such as Ogilvy and VML – warned on annual profits in July as clients cut spending amid global economic uncertainty, leading to a decline in trading for the full year.
Mr Reid leaves after seven years at the helm and a three-decade career at WPP.
His successor worked at Microsoft for nine years, most recently as its chief operating officer for global enterprises.
She was previously chairman of the Western European technology giant and chief executive of its UK business.
His appointment was seen in line with WPP’s efforts to increase its focus on AI and digital transformation to meet rapidly evolving demands.
Third-quarter data on Thursday showed like-for-like revenues in the UK fell 8.9%, “exacerbated by the impact of client assignment losses due to spending cuts”, according to WPP.
It said UK trading pressure was felt most at its WPP media business, creative agency VML and AKQA design and innovation subsidiaries.