MAM
WPP first quarter revenues up 16%
MUMBAI: WPP’s acquisition of Grey Global has resulted in a sliver lining if one goes by the revenues that former has garnered post the take over. WPP’s revenues have seen a 16 per cent rise on the first quarter of 2005, which primarily reflecting strong organic growth and a first-time contribution from Grey from 7 March.
The impact of currency in the first quarter of 2005 was minimal. On a like-for-like basis, excluding acquisitions and currency fluctuations, revenues were up almost six per cent. This maintains the improvement in the organic growth rate of the last two quarters of 2004 and reflects the growing focus by clients on improving profitability through innovation and branding and top line growth, rather than by relying solely on cost cutting.
In all the regions that WPP has a presence in, a double digit revenue growth has been seen. In North America, revenues were up over 16 per cent; in Europe, the UK was up 12 per cent and Continental Europe up over 15 per cent.. Asia Pacific, Latin America, Africa and the Middle East was up 22 per cent.
By communications services sector, advertising and media investment management was up over 17 per cent, information, insight and consultancy up 19 per cent, public relations and public affairs up over 12 per cent, and branding and identity, healthcare and specialist communications up almost 15 per cent.
The net new business billings of GBP 875 million ($1.62 billion) were won during the first quarter. The Group has continued to benefit from consolidation trends in the industry, winning several large assignments from existing and new clients.
In the first quarter both profitability and operating margin were ahead of budget. Full year margin forecasts are in line with the Group’s revised combined margin target for 2005, including Grey, of 14.3 per cent.
Also, WPP’s operating companies continued to improve productivity. On a pro-forma basis, the number of people in the Group (excluding associates) was up 3.8 per cent as of 31 March 2005 to 71,097, as compared to the previous year. In Q1 2005, average headcount on a like-for-like basis was up 5.2 per cent to 64,368, compared with Q1 2004.
Balance Sheet and Cash Flow
WPP has continues to implement its strategy of using free cash flow to enhance share owner value through a judicious combination of capital expenditure, acquisitions and share cancellations, whilst ensuring that these expenditures are covered by free cash flow.
Average net debt in Q1 2005 was down GBP 240 million to GBP 586 million, compared to GBP 826 million in 2004. The current net debt figure compares with a market capitalisation of approximately GBP 7.5 billion. Net debt at 31 March 2005 was GBP 938 million compared to GBP 825 million in 2004 — an increase of GBP 113 million, reflecting a GBP 384 million gross cash payment for Grey.
In the twelve months to 31 March 2005, the Group’s free cash flow was GBP 572 million. Over the same period, the Group’s capital expenditure, acquisitions and share cancellations were GBP 646 million (including a GBP 384 million gross cash payment for Grey).
In the first quarter of 2005, in addition to the completion of the acquisition of Grey, the Group made acquisitions or increased equity interests in advertising and media investment management in the United Kingdom, Denmark and Argentina; in information, insight and consultancy in Hong Kong; in public relations and public affairs in Denmark; in healthcare in the United States, Netherlands and Switzerland; and in direct, Internet and interactive in the United States.
In Q1 2005, 3,367,000 ordinary shares were purchased, at an average price of GBP 6.17 per share and total cost of GBP 20.8 million. 2,250,000 of these shares were cancelled. The company’s objective remains to repurchase up to two per cent annually of its share base in the open market at an approximate cost of GBP 150 million, when market conditions are appropriate.
WPP will also be looking at focusing on its key objectives of improving operating profits by 10 per cent to 15 per cent per annum; improving operating margins by half to one margin point per annum; improving staff cost to revenue ratios by 0.6 margin points per annum; growing revenue faster than industry averages; improving our creative reputation and stimulating co-operation among Group companies.
WPP head honcho Sir Martin Sorrell was quoted in a media report as saying, “The continually increasing cost in network television, the fragmentation of media, and the development of new technologies are all moving the market toward direct, interactive and Internet.”
Brands
ConfirmTkt rolls out 1 per cent cashback for summer train trips
Unlimited wallet rewards valid till 31 May boost holiday travel
GURUGRAM: ConfirmTkt has announced a limited period 1 per cent cashback offer aimed at making summer train travel a little lighter on the wallet.
The authorised B2C online train ticketing platform, part of the Ixigo Group, will credit 1 per cent cashback directly into users’ ConfirmTkt Wallet for every train ticket booked through its app. The offer runs until 31 May 2026, neatly covering the peak summer holiday rush.
There is no cap on how much cashback users can earn during the offer window. The credited amount can be redeemed on the next train booking within 90 days, making it particularly useful for families planning return journeys, students heading home for the holidays, or travellers ticking off multiple destinations in one season.
Importantly, the process is automatic. Cashback is credited after booking, with no codes to enter and no hoops to jump through, keeping the reward simple and seamless.
Ixigo Trains and ConfirmTkt CEO Dinesh Kumar Kotha, said summer remains one of the busiest travel seasons in India, as families, students and professionals take to the rails to reconnect and explore. He noted that by keeping the cashback uncapped and redemption straightforward, the company aims to help travellers extract greater value from both outbound and return trips during this high demand period.
Beyond the seasonal offer, ConfirmTkt continues to position itself as a tech driven, customer first platform. Its features include high accuracy waitlist prediction, nearby trains and alternate travel plan suggestions when seats are scarce, live train status updates, seamless PNR tracking, instant refunds, seat availability alerts and UPI enabled payments. Users can also order food on train for delivery to their seats at selected stations.
Taken together, the platform’s tools are designed to reduce uncertainty and add a layer of reassurance to rail journeys. With this summer cashback in play, ConfirmTkt is not just helping travellers book tickets, but giving them a small return ticket on their spending too.
