WPP, the world’s largest advertising group, cut its full-year net sales outlook on Wednesday after a drop in demand from consumer goods clients and weak trading in the United States led it to miss first-half targets.
“It’s been a tough first-half… The weakest for us was the U.S. which I think was pretty much the case across the industry,” Martin Sorrell, the founder and chief executive of WPP, told CNBC on Wednesday morning.
The advertising firm reported first-half like-for-like net sales down 0.5 percent, below a consensus of 0.7 percent growth. It cut its full-year target to between 0 and 1 percent growth, from a previous forecast of 2 percent growth.
Despite the slowdown, the group reiterated its target for a 0.3 point improvement in its operating margin.
WPP rattled investors in March when the company announced it had cut its sales forecast for 2017. It cited an ultra-competitive environment in which rivals were having to scrap for every dollar of ad spend.
The group recorded net sales growth of 3.1 percent in 2016 though the target for 2017 was revised down to 2 percent in order to reflect “tepid” economic growth and weaker net new business trends.