WPP Scangroup bounces back with Sh75 million profit
Marketing firm WPP Scangroup has completed a turnaround registering profitability as net earnings for the year ended December 2022 came in at Kes75.2 million from a loss of Kes37.9 million in 2021.
The company’s growth in profitability is largely attributable to foreign exchange gains, which were posted at Kes145.9 million from Kes27.4 million previously.
Revenues for the Group nevertheless eased slightly to Kes7.32 billion from Kes7.6 billion a year earlier as inflationary pressures, and tightening financial regulations hampered spending.
“Unfortunately, we will not be declaring the 2022 dividend because our distributable reserves are in the negative,” Ms Kaggwa noted.
Further, operating and administrative expenses were meanwhile largely unchanged at Kes2.5 billion for the trading year that Patricia Ithau was at the helm of the company as CEO and Executive Director.
WPP Scangroup Chief Financial Officer Miriam Kaggwa, said: “We have recorded improved performance in 2022, with YoY profit after tax up by 298 percent across our WPP agencies. We delivered increased value to our shareholders with an EPS growth of 450 percent.
While market pressures led to relatively reduced client margins, we recorded a net new business of Kes386m in 2022. We recorded increased pass-through costs but still delivered strong fundamentals with Kes2.2 billion gross profit.”
WPP Scangroup remains optimistic in the years ahead with CEO Patricia Ithau signaling that the firm is deploying a number of digital tools including social media listening platform Feed, Web 3, and Influence0 to get a sizeable share of the $7 billion advertising market in Africa.
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The company has also deployed OPTIMUS, a marketing automation tool that taps the power of machine learning and data analytics to drive customer acquisition and create value at scale and speed.
The shift to data-driven, AI-powered platforms by WPP Scangroup is informed by the changing consumer behavior with the bulk of conversations happening through digital devices. In Kenya, a total of 17.8 million people are active on the internet, and the average growth of new users is at 8 percent, faster than the country’s GDP growth.
In January, WPP-owned media GroupM unveiled its new data-driven agency EssenceMediacom which brings together Essence’s performance, data, analytics, and creative technology DNA with MediaCom’s multichannel audience planning and strategic media strength.
