WPP, in its continued progress in implementing three-year turnaround plan, is facing the anticipated headwinds following client assignment losses in 2018. However, the company’s Revenue and revenue less pass-through costs Revenue in the first quarter of 2019 was £3.588 billion, up 0.9% compared with the same period last year on a reported basis and -0.6% on a constant currency basis.
Its Like-for-like revenue was -1.3% compared with last year. Revenue less pass-through costs was £2.926 billion, down 0.7% on a reported basis, -2.3% in constant currency and -2.8% like-for-like.
Asia Pacific, Latin America, Africa & the Middle East and Central & Eastern Europe was the strongest performing region for WPP with its like-for-like revenue less pass-through costs up 2.3%. There was strong growth in Latin America, Central & Eastern Europe and South East Asia, with Australia and New Zealand more difficult.
In Asia Pacific, Greater China and India, which account for almost half of the region, grew strongly, with Malaysia, Thailand and Vietnam more challenging. In Latin America, four of the Group’s top five markets showed particularly strong growth. WPP’s Like-for-like revenue for APAC, LA, AM, CEE during the said period stood at 5.8% against the overall figure of -1.3%.
The previously announced sale process of Kantar is progressing well, in line with our expectations. We are pleased with the level of interest in the business from high-quality potential partners.
Average net debt in the first quarter of 2019 was £4.163 billion, compared to £4.875 billion in 2018 (at 2019 exchange rates), a decrease of £712 million. Net debt at 31 March 2019was £4.624 billion, compared to £5.500 billion in 2018 (at 2019 exchange rates), a decrease of £876 million. This improvement is largely explained by the disposal of various non-core associates and subsidiaries in 2018 and the first quarter of 2019 (and one property disposal), which in aggregate realised £1.028 billion.
In March 2019, the Group refinanced its $2.5 billion revolving credit facility, extending maturity to March 2024. The Group also repaid the £200 million 6.375% bonds due in 2020 following a tender offer.
North America, with like-for-like revenue less pass-through costs down 8.5%, was the weakest performing region, due to continued pressure and the impact of assignment losses among automotive, pharmaceutical and FMCG clients in 2018. This performance, whilst disappointing, was in line with our budgets. The actions we have taken since September with our creative and healthcare agencies, alongside leadership changes, are intended to address the Group’s performance in the United States.
In the United Kingdom, like-for-like revenue less pass-through costs was down 0.9%, a slight decline on 2018’s full-year performance.
Western Continental Europe like-for-like revenue less pass-through costs was down slightly at -0.3%. Belgium, Denmark, Finland, Netherlands and Turkey were up strongly, with Austria, Italy and Spain more challenging. Germany, the Group’s largest market in the region, was up slightly.