WPP declares interim dividend and beats dire forecasts
LONDON, Aug 27 (Reuters) - The world's biggest advertising company WPP WPP.L said it had resumed its dividend as a sign of confidence after cost cuts and a switch to faster ad production helped it to beat dire forecasts for second-quarter trading.
The British company declared an interim dividend of 10 pence per share as it posted a fall in underlying net sales of 15.1%, compared with consensus of a 20% drop, and said it would reintroduce its share buyback when the environment stabilised.
It also took an impairment charge of 2.7 billion pounds ($3.6 billion), which it said was due to the reassessment of acquisitions in light of the virus and the way it has affected the industry.
"Assuming there is no second wave nor major lockdowns, the second quarter is expected to be the toughest period of the year, although we remain cautious on the speed of recovery," Chief Executive Mark Read said.
WPP pulled its dividend, share buyback and 2020 guidance on March 31 as it braced for the full impact of COVID-19, which was spreading around the world.
The company said it had won an industry-leading level of new work during the first half, at $4 billion, from clients such as Intel, HSBC and Unilever. It said trading in July showed some improvement, with net sales down 9.2%.
($1 = 0.7571 pounds)
(Reporting by Kate Holton, Editing by Paul Sandle)
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