WPP plc

Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to WPP preliminary financial results conference call and webcast. At this time, all participants are in listen only mode. After the speaker's presentation, there will be a question and answer session. At which time, if you wish to ask a question, please press star one on your telephone keypad. Today's conference is being recorded. At this time, I would like to hand the conference over to WPP CEO, Mr. Mark Reid. Please go ahead, sir.

Thank you very much, and good morning, everyone, and welcome to the WPP 2022 preliminary results presentation. As you know, we now do this as more of a Q&A session. We should take the presentation as read. It's available online. Rather than take up your time with that, we thought we could get straight into questions. Maybe I'll make a few preliminary Remarks. I'm here with John Rogers, our CFO. So John and I will take your questions. Look, I think we had a good 2022. We grew 6.9% in the year. A respectable or more respectable Q4, 6.4%, perhaps somewhat better than we'd expected after a somewhat softer Q3. So that was in part driven by comparatives. But I think, you know, the momentum we had through the year carried into Q4. And I think you'll see some of that momentum carry into next year through our guidance. We had a very broad-based performance are integrating up to 6.9% with a three year greater than 9.5%. Strong performance from Group M, Ogilvy, AKQA, Hogarth. Our PR businesses were up 8.2% light for light with a strong performance, particularly from Hill & Knowlton. And our specialist agencies up 5.6%. So functionally, we've improved strongly across all our functions. And regionally as well, North America up 6.6%, UK up 7.6%. I'd call out a particularly resilient Western continent Europe at 5.5%. and Asia Pacific, rest of the world, up 8% last year. So a broad-based performance across services and regions, a strong competitive performance from leading at Cannes to a new business number close to $6 billion. We continue to invest in the business, and we talked a lot on the call about the impact of AI on our industry, which I think is going to be fundamental. Our transformation savings are ahead of plan. And we're on track to deliver this hundred billion pounds of savings by 2025. And then lastly, our guidance. So our guidance for life-like revenue as partial cost is three to 5% and a headline operating margin of around 15%. And I think that's based on conversations that we have with clients, what they're telling us about what they intend to spend for the year, really driven by their continued desire to invest in their business and invest in brands. I think in part also driven by the complexity of the environment and the new media opportunities available to them on platforms like Netflix and TikTok and retail media platforms, as well as the transformation in WPP's business and expansion we've made in new areas around data, technology, and e-commerce. So in short, I think we had a good year. We're going into this year, I would say, confident in our guidance. It's a little bit... It's a little bit... softer than 2022, but I think that's what one would expect, and it's significantly ahead of analyst expectations, certainly, at the end of last year. So with that as an introduction, why don't we open it up for questions, and John and I will take those as people have them.

Thank you, Sam. If you would like to ask a question at this time, please press star 1 on your telephone. Please ensure that the mute function on your telephone is switched off to allow your signal to reach our equipment. If you are also watching the webcast, please make sure to mute the computer's volume to prevent feedback through the phone while asking a question. If you find that your question has already been answered, you may remove yourself from the queue by pressing star 2. Again, please press star 1 to ask a question. We will pause for a moment to allow everyone to signal. We will now take our first question from Tim Nolan from Macquarie. Tim, please go ahead.