WPP Scangroup bounces back to profitability
Marketing communications firm WPP Scangroup has posted Kes31.4 million half-year profit period to June 2021, reversing a Kes532 million loss suffered at a comparable period in 2020.
The improved performance by the marketing firm is attributable to lower staff costs and impairment charges with the provisions for bad and doubtful debts dipping to Kes25.4 million by June from a higher Kes328.8 million at the same stage last year.
In the half, the company net sales rose by two per cent to Kes1.1 billion even as the provision for doubtful debts went up by Kes276 million principally due to lower staff costs.
Further, WPP Scangroup net interest income increased to Kes99 million owing to payments following the sale of Kantar Businesses last year.
WPP Scangroup made a one-off gain of Kes2.2 billion from the disposal of Kantar Businesses that allowed the communications firm to pay out Kes.3.4 billion in special dividends in July, last year.
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This year, however, WPP Scangroup has issued a profit warning on expected full year results to December 31 indicating expected lower earnings.
“The reason for the expected lower earnings in 2021 is primarily due to the impact of discontinued operations in the prior year when the company disposed of its interest in Millward Brown East Africa Ltd, Millward Brown Nigeria Ltd, Millward Brown West Africa Ltd, and Research and Marketing Group Investment Ltd in June 2020,” the firm noted in a statement.
WPP Scangroup former CEO Bharat Thakrar and chief financial officer Satyabrata Das resigned earlier this year while investigations on allegations of gross misconduct were still ongoing.
