WPP PLC ( WPP ) shares are trading lower on Thursday after the company reported fourth-quarter and 2024 preliminary results.

Revenue for the year was 14.74 billion British pounds ($18.8 billion) compared to 14.85 billion British pounds in 2023.

Revenue declined by 0.7% year over year (Y/Y) on a reported basis, and there was an increase of 2.3% Y/Y on a like-for-like (LFL) basis. 

Adjusted operating cash flow increased to 1.460 billion British pounds in FY24 from 1.28 billion British pounds and adjusted free cash flow rose to 738 million British pounds, benefiting from strong working capital management.

As of December 31, 2024, adjusted net debt stood at 1.7 billion British pounds. Cash restructuring and transformation costs of 275 million British pounds, included in non-headline cash items are slightly lower than the guidance given in January 2024 and relate to actions communicated at the January Capital Markets Day.

These costs include the structural cost-saving plan related to the creation of VML and Burson and the simplification of GroupM.

The structural savings are expected to generate annualized net cost savings of approximately 125 million British pounds in 2025, with 85 million British pounds of that achieved in 2024, ahead of the original plan (40-50%).

The fourth-quarter like-for-like (LFL) revenue excluding pass-through costs declined by 2.3%. By geographies, growth in Western Continental Europe (+1.4%) was offset by declines in North America (-1.4%), the U.K. (-5.1%), and the Rest of World (-4.8%), with China seeing a significant drop of -21.2% in the quarter.

By business, Global Integrated Agencies LFL revenue less pass-through costs fell 2.2%, GroupM rose 2.4% Y/Y, while other Global Integrated Agencies declined 6.5% Y/Y.

FY25 Outlook: WPP expects mergers and acquisitions to reduce revenue less pass-through costs by around 3.0ppts primarily due to the disposal of FGS Global.

The company expects capex of around 250 million British pounds and adjusted operating cash flow before working capital of around 1.4 billion British pounds.

Price Action: WPP shares are down 15.6% at $40.98 at the last check Thursday.

Read Next:

Omnicom Inks $13 Billion Deal For Interpublic: Will It Topple WPP As Top Ad Company?

Image via Shutterstock.