REG - WPP PLC - WPP 2014 Preliminary Results <Origin Href="QuoteRef">WPP.L</Origin> - Part 2
09/03/2015 07:02
- Part 2: For the preceding part double click ID:nRSI8691Ga
New media and data investment management, including the application of technology and big data
So far in 2015, acquisitions have already been made in the first two months in data investment management in the United
States; direct, digital and interactive in Peru; sports marketing in the United States; and healthcare in Australia.
Last but not least………
When WPP advertises for applicants to its annual Marketing Fellowship programme, the headline reads, Ambidextrous Brains
Required. Some people say they do not know what that means; but all those in whom WPP would be particularly interested
understand immediately.
More than in most occupations, to be successful in marketing communications, you need not only to be able to speculate with
unrestrained imagination, but also to scrutinise concepts and ideas with a forensic rigour. The normal shorthand is to say
that exceptional marketing is part science and part art: and, as shorthand, that is probably true. It is more and more
widely recognised that strong and profitable brands appeal at least as much to the emotions as they do to the reason.
Effective brand communicators are those who instinctively understand that truth and delight in working with it.
In a report of this kind, a year's achievements, if only for fiduciary reasons, have to be expressed almost entirely in
terms of numbers. But it must never be forgotten that those numbers are the end product of the personal achievements of
tens of thousands of individual people; and people, what's more, of unusual talent. They have ambidextrous brains; that is
why our clients come to us; and why they deserve our gratitude and very public recognition.
For further information:
Sir Martin Sorrell }
Paul Richardson }
Chris Sweetland } +44 20 7408 2204
Feona McEwan }
Chris Wade }
Kevin McCormack }
Fran Butera } +1 212 632 2235
Belinda Rabano } +86 1360 1078 488
www.wppinvestor.com
This announcement has been filed at the Company Announcements Office of the London Stock Exchange and is being distributed
to all owners of Ordinary shares and American Depository Receipts. Copies are available to the public at the Company's
registered office.
The following cautionary statement is included for safe harbour purposes in connection with the Private Securities
Litigation Reform Act of 1995 introduced in the United States of America. This announcement may contain forward-looking
statements within the meaning of the US federal securities laws. These statements are subject to risks and uncertainties
that could cause actual results to differ materially including adjustments arising from the annual audit by management and
the Company's independent auditors. For further information on factors which could impact the Company and the statements
contained herein, please refer to public filings by the Company with the Securities and Exchange Commission. The statements
in this announcement should be considered in light of these risks and uncertainties.
Appendix 1: Preliminary results for the year ended 31 December 2014
Unaudited preliminary consolidated income statement for the year ended
31 December 2014
£ million Notes 2014 2013 +/(-)% Constant Currency1+/(-)%
Billings 46,186.3 46,209.3 - 6.8
Revenue 6 11,528.9 11,019.4 4.6 11.3
Direct costs (1,464.1) (943.3) (55.2) (64.4)
Net sales 6 10,064.8 10,076.1 (0.1) 6.3
Operating costs 4 (8,557.5) (8,665.8) 1.2 (5.0)
Operating profit 1,507.3 1,410.3 6.9 14.6
Share of results of associates 4 61.9 68.1 (9.1) 2.2
Profit before interest and taxation 1,569.2 1,478.4 6.1 14.1
Finance income 5 94.7 64.3 47.3 69.0
Finance costs 5 (262.7) (267.9) 1.9 (2.3)
Revaluation of financial instruments 5 50.7 21.0 - -
Profit before taxation 1,451.9 1,295.8 12.0 21.3
Taxation 7 (300.4) (283.7) (5.9) (15.0)
Profit for the year 1,151.5 1,012.1 13.8 23.1
Attributable to:
Equity holders of the parent 1,077.2 936.5 15.0 24.2
Non-controlling interests 74.3 75.6 1.7 (9.1)
1,151.5 1,012.1 13.8 23.1
Headline PBIT 6,19 1,680.6 1,661.6 1.1 8.0
Net sales margin 6,19 16.7% 16.5% 0.22 0.32
Headline PBT 19 1,512.6 1,458.0 3.7 11.6
Earnings per share
Basic earnings per ordinary share 9 82.4p 72.4p 13.8 22.9
Diluted earnings per ordinary share 9 80.5p 69.6p 15.7 24.9
1 The basis for calculating the constant currency percentage changes shown above and in the notes to this appendix are
described in the glossary attached to this appendix.
2 Margin points
Unaudited preliminary consolidated statement of comprehensive income for the year ended 31 December 2014
£ million 2014 2013
Profit for the year 1,151.5 1,012.1
Items that may be reclassified subsequently to profit or loss:
Exchange adjustments on foreign currency net investments (221.2) (372.6)
Gain on revaluation of available for sale investments 64.6 72.0
(156.6) (300.6)
Items that will not be reclassified subsequently to profit or loss:
Actuarial (loss)/gain on defined benefit pension plans (86.6) 76.2
Deferred tax on defined benefit pension plans 62.1 (1.2)
(24.5) 75.0
Other comprehensive loss relating to the year (181.1) (225.6)
Total comprehensive income relating to the year 970.4 786.5
Attributable to:
Equity holders of the parent 893.0 727.0
Non-controlling interests 77.4 59.5
970.4 786.5
Unaudited preliminary consolidated cash flow statement for the year ended
31 December 2014
£ million Notes 2014 2013
Net cash inflow from operating activities 10 1,703.7 1,374.2
Investing activities
Acquisitions and disposals 10 (489.1) (201.4)
Purchase of property, plant and equipment (177.9) (240.7)
Purchase of other intangible assets (including capitalised computer software) (36.5) (43.8)
Proceeds on disposal of property, plant and equipment 5.9 7.3
Net cash outflow from investing activities (697.6) (478.6)
Financing activities
Share option proceeds 25.0 42.4
Cash consideration for non-controlling interests 10 (5.6) (19.6)
Share repurchases and buybacks 10 (510.8) (197.0)
Net increase in borrowings 10 465.2 436.8
Financing and share issue costs (27.5) (19.1)
Equity dividends paid (460.0) (397.3)
Dividends paid to non-controlling interests in subsidiary undertakings (57.7) (53.2)
Net cash outflow from financing activities (571.4) (207.0)
Net increase in cash and cash equivalents 434.7 688.6
Translation differences (70.3) (164.7)
Cash and cash equivalents at beginning of year 1,883.2 1,359.3
Cash and cash equivalents at end of year 10 2,247.6 1,883.2
Reconciliation of net cash flow to movement in net debt:
Net increase in cash and cash equivalents 434.7 688.6
Cash inflow from increase in debt financing (437.7) (418.1)
Conversion of bond to equity - 449.9
Other movements 23.8 21.0
Translation differences (55.8) (160.6)
Movement of net debt in the year (35.0) 580.8
Net debt at beginning of year (2,240.4) (2,821.2)
Net debt at end of year 11 (2,275.4) (2,240.4)
Unaudited preliminary consolidated balance sheet as at 31 December 2014
£ million Notes 2014 2013
Non-current assets
Intangible assets:
Goodwill 12 9,979.4 9,472.8
Other 13 1,668.9 1,667.8
Property, plant and equipment 772.5 773.3
Interests in associates and joint ventures 759.9 792.8
Other investments 669.2 270.6
Deferred tax assets 239.7 119.4
Trade and other receivables 14 148.6 158.5
14,238.2 13,255.2
Current assets
Inventory and work in progress 327.3 304.5
Corporate income tax recoverable 145.6 136.0
Trade and other receivables 14 9,530.0 9,088.1
Cash and short-term deposits 2,512.7 2,221.6
12,515.6 11,750.2
Current liabilities
Trade and other payables 15 (11,784.0) (10,710.7)
Corporate income tax payable (158.6) (120.1)
Bank overdrafts and loans (653.2) (941.4)
(12,595.8) (11,772.2)
Net current liabilities (80.2) (22.0)
Total assets less current liabilities 14,158.0 13,233.2
Non-current liabilities
Bonds and bank loans (4,134.9) (3,520.6)
Trade and other payables 16 (624.9) (457.6)
Corporate income tax payable (441.2) (362.6)
Deferred tax liabilities (667.6) (650.7)
Provisions for post-employment benefits (296.2) (247.5)
Provisions for liabilities and charges (166.4) (147.7)
(6,331.2) (5,386.7)
Net assets 7,826.8 7,846.5
Equity
Called-up share capital 17 132.6 134.9
Share premium account 508.0 483.4
Shares to be issued 0.3 0.5
Other reserves 36.2 317.3
Own shares (283.7) (253.0)
Retained earnings 7,106.7 6,903.7
Equity share owners' funds 7,500.1 7,586.8
Non-controlling interests 326.7 259.7
Total equity 7,826.8 7,846.5
Unaudited preliminary consolidated statement of changes in equity for the year ended 31 December 2014
£ million Called-up Share Shares tobe issued Other Own shares Retained Total equity share owners' funds Non- controlling interests Total
share premium reserves earnings
capital account
Balance at 1 January 2014 134.9 483.4 0.5 317.3 (253.0) 6,903.7 7,586.8 259.7 7,846.5
Ordinary shares issued 0.4 24.6 (0.2) - - 0.2 25.0 - 25.0
Treasury share additions - - - - (412.5) - (412.5) - (412.5)
Treasury share allocations - - - - 0.6 (0.6) - - -
Treasury share cancellations (2.7) - - 2.7 332.5 (332.5) - - -
Net profit for the year - - - - - 1,077.2 1,077.2 74.3 1,151.5
Exchange adjustments on foreign currency net investments - - - (224.3) - - (224.3) 3.1 (221.2)
Gain on revaluation of available for sale investments - - - 64.6 - - 64.6 - 64.6
Actuarial loss on defined benefit pension plans - - - - - (86.6) (86.6) - (86.6)
Deferred tax on defined benefit pension plans - - - - - 62.1 62.1 - 62.1Recent news on WPP
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