Financial Performance - For the year ended December 31, 2024, WPP plc reported revenue of £14,741 million and operating profit of £1,325 million[22]. - Total revenue for 2024 was £14,741 million, a slight decrease of 0.7% from £14,845 million in 2023[51]. - Revenue less pass-through costs for 2024 was £11,934 million, down from £12,034 million in 2023, representing a decrease of 0.8%[51]. - Operating profit increased by 149.5% to £1,325 million in 2024, compared to £531 million in 2023, while headline operating profit decreased by 2.5% to £1,707 million[104]. - Profit before tax rose by 198.0% to £1,031 million in 2024, compared to £346 million in 2023, with headline profit before tax down 3.8% to £1,467 million[107]. - Headline operating profit for the Total Group was £1,707 million in 2024, down from £1,750 million in 2023[115]. - The company reported a loss for the year of £706 million, with finance costs to non-guarantors amounting to £779 million[149]. - Adjusted free cash flow for 2024 is £738 million, up from £637 million in 2023[180]. - Net cash inflow from operating activities rose to £1,408 million in 2024, compared to £1,238 million in 2023[180]. Client and Revenue Composition - The ten largest clients accounted for 19.7% of revenue less pass-through costs in the year ended December 31, 2024[28]. - The top 25 clients of the company saw a growth of 2.0% in 2024, indicating a strong demand for integrated marketing solutions[64]. - WPP's revenue from Global Integrated Agencies increased from £12,133 million in 2022 to £12,562 million in 2024, reflecting a consistent contribution to total revenue[49]. - North America accounted for 38% of total revenue in 2024, with revenue of £5,567 million, a slight increase from £5,528 million in 2023[51]. Employee and Operational Metrics - The Group had 108,044 employees as of December 31, 2024[22]. - The total number of employees decreased to 108,044 at the end of 2024 from 114,173 at the end of 2023[103]. - The company employs approximately 108,044 people across more than 100 countries[31]. - The company's six agency networks account for approximately 92% of revenue less pass-through costs, enhancing operational efficiency[67]. Strategic Initiatives and Risks - WPP Open, the AI-driven operating system, is crucial for maintaining competitiveness and operational efficiency[28]. - Economic risks, including inflation and currency volatility, could lead clients to reduce marketing budgets, impacting WPP's revenues[27]. - The failure to successfully implement the strategic plan updated in January 2024 may adversely affect market share and financial condition[27]. - Cybersecurity threats are increasing, with potential impacts on operations and client trust if data protection measures fail[29]. - Changes in local or international tax rules could significantly impact WPP's tax liabilities and liquidity position[29]. - The Group's operations are susceptible to increased costs due to potential future changes in ESG laws and regulations, including the EU Corporate Sustainability Reporting Directive[30]. Financial Position and Cash Flow - Cash and cash equivalents at 31 December 2024 were £2,467 million, an increase from £1,860 million in 2023[138]. - Adjusted net cash inflow improved to £745 million in 2024, compared to £2 million in 2023, driven by higher disposal proceeds and lower net acquisition payments[129]. - Total liquidity, including undrawn credit facilities, reached £4,464 million at 31 December 2024, up from £3,824 million in 2023[138]. - The adjusted net debt of the group at 31 December 2024 was £1,690 million[140]. Governance and Compensation - For the fiscal year ended December 31, 2024, WPP paid a total compensation of £47 million to key management personnel, which includes salaries, performance-related bonuses, and other benefits[211]. - Mark Read received a total annual compensation of £3.801 million, including a base salary of £1.14 million and performance-related incentives[212]. - Joanne Wilson, who joined on April 19, 2023, received a total annual compensation of £1.850 million, with a base salary of £750,000[212]. - The independence of all Non-Executive Directors was confirmed by the Board, in compliance with the UK Corporate Governance Code[210].

Core Viewpoint - WPP PLC has experienced a significant decline of 17.8% over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround as analysts expect better earnings than previously predicted [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is a key technical indicator used to identify oversold stocks, with a reading below 30 typically indicating oversold conditions [2]. - WPP's current RSI reading is 29.07, indicating that the heavy selling pressure may be exhausting, which could lead to a price rebound [5]. - The RSI helps investors identify potential entry points for stocks that have fallen below their fair value due to unwarranted selling [3]. Group 2: Fundamental Indicators - There is a strong consensus among sell-side analysts regarding WPP, with a 0.4% increase in the consensus EPS estimate over the last 30 days, suggesting potential price appreciation [7]. - WPP holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a favorable outlook for a near-term turnaround [8].

Core Insights - CMI Media Group has released a report focusing on equity in healthcare in America and the role healthcare brands can play to support consumers [1] - The report highlights the importance of understanding US consumers' healthcare experiences, particularly through the lens of cultural and location demographics [2] Key Findings - Nearly half of patients are willing to travel between 30-90 minutes to see healthcare professionals that match their demographics, especially among Black patients [5] - Multiple barriers to care are affecting consumers, particularly in rural and urban areas, with patients reporting cancellations due to cost and travel issues [5] - Black and Hispanic audiences show greater trust in advertising and tend to rely on health information from websites, search engines, and pharmaceutical company sites [5] Company Overview - CMI Media Group is a full-service media agency focused on health, wellness, and pharmaceutical marketing, offering services such as Audience Strategy, Data and Analytics, and Customer Experience [4] - The agency has been recognized for its leadership in diversity, equity, and inclusion (DE&I), talent retention, and employee development [4]

Group 1 - WPP plc (NYSE: WPP) is showing margin improvements, but overall performance this quarter has limited positives, particularly due to challenges in the APAC region [2] - The Value Lab focuses on long-only value investment strategies, targeting a portfolio yield of approximately 4% and emphasizing international mispriced equities [1][2] - The Valkyrie Trading Society consists of analysts who share high conviction investment ideas that are expected to yield non-correlated and outsized returns in the current economic environment [3]

Financial Data and Key Metrics Changes - Net revenue growth for 2024 was reported at minus 1%, consistent with the lower end of guidance range [7][19] - Headline operating margin improved to 15%, up 40 basis points year-on-year, despite a GBP 250 million investment in AI and data [9][21] - Operating cash flow conversion improved to 86%, benefiting from strong working capital management [14][25] - Year-end net debt decreased to GBP 1.7 billion, a reduction of GBP 0.8 billion year-on-year [14][46] Business Line Data and Key Metrics Changes - Global Integrated Agencies saw a like-for-like decline of 0.8% in 2024, while GroupM grew by 2.7% for the full year [33][34] - Global integrated creative agencies experienced a decline of 3.9% in 2024, with a more significant drop of 6.5% in Q4 [34] - Public Relations saw a like-for-like decline of 1.7% in 2024, impacted by a challenging environment for discretionary spending [36] - Specialist Agencies reported a decline of 2.3% in revenue less pass-through costs for the year [37] Market Data and Key Metrics Changes - North America experienced a decline of 0.7% in 2024, with growth in automotive and financial services offset by lower revenues in healthcare [38] - The United Kingdom declined by 2.7% in 2024, influenced by a higher weighting towards project-based work [39] - China faced a significant decline of 20.8% in 2024, reflecting macroeconomic pressures and client assignment losses [41] Company Strategy and Development Direction - The company is focused on executing its strategy to deliver long-term sustainable growth and value to shareholders [4][16] - Investment in WPP Open and AI is a key strategic pillar, with a commitment to enhance technology integration across the organization [54][58] - The company aims to improve new business performance and cash conversion while addressing challenges in client discretionary spending [10][22] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges faced in 2024, particularly in Q4, but expressed confidence in the strategic progress made [10][91] - The outlook for 2025 includes cautious guidance of flat to minus 2% like-for-like revenue, reflecting macroeconomic uncertainties [50][108] - Management expects performance to strengthen in the second half of 2025 as historical client losses begin to taper off [50][124] Other Important Information - The company plans to continue prioritizing investment in WPP Open, AI, and data, with an incremental cash spend of GBP 50 million planned for 2025 [45][50] - The company reported a flat final dividend of 24.4 pence, consistent with the previous year, representing a cash return to shareholders of over GBP 420 million [31] Q&A Session Summary Question: Why is the guidance for next year similar to 2024 despite better account wins? - Management explained that Q4 was softer than expected, and macro uncertainty has increased, impacting guidance [108][110] Question: How will flat margins be delivered with negative growth? - Management indicated that structural cost savings and efficiencies would support flat margins despite revenue challenges [114][116] Question: What is the expected average net debt to EBITDA ratio for 2025? - Management expects the average leverage to decrease towards the midpoint of the target range of 1.5% to 1.75% [107] Question: Is there a correlation between cuts in discretionary spending and CPG performance? - Management noted that the impact on CPG was driven by various factors, including variable incentives, and does not see in-housing as a significant risk [126][128]

Core Insights - U.S.-listed shares of WPP Plc fell 15% following a decline in revenue and soft guidance, particularly in North America and China [1][5] Financial Performance - WPP reported a 2.3% year-over-year decline in fourth-quarter like-for-like revenue less pass-through costs, with North America down 1.4% and the U.K. down 5.1% [2] - Revenue less pass-through costs in China dropped significantly by 21.2%, while Western Continental Europe saw a modest gain of 1.4% [2] Management Commentary - CEO Mark Read indicated that sales were affected by weaker client discretionary spending and expressed caution regarding the macro environment [3][5] - Despite the challenges, the CEO remains confident in medium-term targets, emphasizing a focus on innovation and operational excellence to support growth [3] Guidance and Market Reaction - WPP's full-year guidance for like-for-like revenue less pass-through costs is expected to be flat to down 2%, which is below the Visible Alpha estimate of a 0.35% increase [3] - The disappointing guidance has resulted in U.S.-listed shares of WPP entering negative territory for the past year [4]

Core Insights - CMI Media Group has released its first Media Vitals HCP Global research, providing insights into the media preferences of healthcare professionals (HCPs) globally [1][2] - The report emphasizes the need for brands to optimize and personalize communications with HCPs, highlighting opportunities for better support from pharmaceutical companies [2] Research Methodology - Insights were gathered from various medical doctors, including General Practitioners, Cardiologists, Pulmonologists, Hematologists, Neurologists, Oncologists, Obstetricians-Gynecologists, and Dermatologists [2] - The survey was conducted across six countries: France, Germany, Italy, Spain, United Kingdom, and Canada [2] Key Findings - Nearly half (46%) of HCPs surveyed collaborate with HCPs in other markets on a weekly basis [6] - In-person interactions remain the most common form of patient interaction, with 46% of HCPs meeting patients in person, while 71% utilize telehealth weekly [6] - A significant portion of HCPs (59%) are confident that patients have enough information to make informed decisions, indicating a role for media in patient education [6] - Over four-fifths (82%) of HCPs are likely to click on an online ad, and 83% are comfortable with personalized ads [6] Company Background - CMI Media Group is a full-service media agency focused on health, wellness, and pharmaceutical marketing, recognized for its leadership in DE&I and employee development [5] - The agency has been providing detailed guidance on pharma marketing efforts since 2013, making it a premier research tool for healthcare marketers [3]

| --- | --- | --- | --- | --- | --- | |---------------------|---------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | Q3 UPDATE | TRADING | | | | | | 23 October 2024 | | | | | | CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This document contains statements that are, or may be deemed to be, "forward-looking statements". Forwardlooking statements give the Company's current expectations or forecasts of future events. These forward-looking statements may include, among ...

Financial Data and Key Metrics Changes - The third quarter delivered a return to growth with a 0.5% increase in net sales, led by GroupM, which grew 4.8% after 1.9% growth in the first half [3][4] - Revenue less pass-through costs fell 2.6% on a reported basis but was up 0.5% on a like-for-like basis, with a 2.9 percentage point headwind from foreign exchange due to sterling strengthening [7][8] - The company reiterated guidance for like-for-like net sales of minus 1.0% to flat for the full year, with expectations for 20 to 40 basis points of margin improvement [6][13] Business Line Data and Key Metrics Changes - Global Integrated Agencies grew 0.5% in the quarter, with GroupM's media planning and buying business growing 4.8%, while integrated creative agencies declined 3.1% [8][9] - Hogarth continued to grow well, benefiting from new business wins and demand for technology and AI-driven capabilities, while VML was impacted by the loss of a healthcare creative assignment [8][9] - PR revenue grew 0.2%, with Burson declining mid-single digits due to the loss of Pfizer assignments, offset by growth at FGS Global [9] Market Data and Key Metrics Changes - North America grew 1.7%, reflecting good growth in GroupM and across the Auto and Financial Services sectors, while the U.K. net sales were stable year-on-year [10] - Western Continental Europe improved with 2.2% growth, while the Rest of the World declined by 2.2%, significantly impacted by a 21.3% decline in China [10][11] - Consumer-packaged goods grew 7.6%, while technology saw growth of 1.3%, automotive grew 5.8%, and healthcare and retail continued to decline [11] Company Strategy and Development Direction - The company is focused on building a simpler, more efficient organization through the simplification at GroupM and the adoption of WPP Open, which leverages AI and new technologies [16][20] - Significant new business wins include Amazon's media account and expanded relationships with Unilever and Starbucks, indicating a competitive edge in the market [5][18] - The strategic focus includes the sale of a stake in FGS Global to KKR, which is expected to strengthen the balance sheet and provide financial flexibility [23] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, noting that while the past year has been challenging, recent new business wins and a strong pipeline position the company well for 2025 [24][25] - The macroeconomic environment remains uncertain, particularly in China, but management expects stabilization in 2025 [47] - AI is viewed as a transformative force for the company, with significant investments being made to enhance productivity and effectiveness [20][26] Other Important Information - Adjusted net debt was around GBP300 million lower than the previous year, with expectations for it to remain broadly flat at year-end [12] - The company is investing over GBP250 million in WPP Open to enhance AI capabilities across its agencies [20] Q&A Session Summary Question: What will need to happen in Q4 to reach the top end of the full year 2024 guide? - Management indicated that improvement in China, stabilization in tech, and favorable macro conditions are necessary to achieve the top end of the guidance [29] Question: Impact of recent wins on 2025 growth? - Management expects net new business to have a neutral impact on 2025, with the potential for positive contributions if recent successes are built upon [30] Question: Any new initiatives from GroupM's new CEO? - Management noted that the focus remains on the ongoing simplification and synergy projects initiated last year [34] Question: Any M&A activity in the pipeline? - Management stated that while this year has been light for M&A, they expect to return to more normalized levels next year [35] Question: Headwind from account losses in 2024? - Management confirmed that the healthcare loss was a significant drag, estimated at around 1.5% [39] Question: Tone of conversation with automotive and consumer goods companies? - Management observed that companies continue to invest in ongoing marketing, although there is caution regarding discretionary spending [40] Question: Broader impact of Media Studio on existing clients? - Management explained that Media Studio is being gradually deployed, improving media effectiveness and ROI for clients [42] Question: Incremental client losses in China? - Management reported no significant new client losses, emphasizing ongoing efforts to stabilize the business in China [49]

Group 1 - The Zacks Rank emphasizes earnings estimates and revisions to identify strong stocks, while also considering value, growth, and momentum trends [1] - Value investing is a preferred strategy for finding strong stocks, utilizing fundamental analysis and traditional valuation metrics to identify undervalued stocks [1] - The Style Scores system can help investors find stocks with specific traits, particularly in the "Value" category for value investors [1] Group 2 - WPP currently has a Zacks Rank of 2 (Buy) and a Value grade of A, indicating strong potential [2] - WPP's Forward P/E ratio is 8.60, which is lower than the industry's average Forward P/E of 10.06, suggesting it may be undervalued [2] - The P/B ratio for WPP is 2.25, significantly lower than the industry's average P/B of 6.05, further indicating potential undervaluation [2] - Over the past year, WPP's P/B has fluctuated between 1.75 and 2.44, with a median of 2.14, showing stability in its valuation metrics [2] - WPP's strong earnings outlook contributes to its classification as an impressive value stock at the moment [2]