WPP Scangroup, the only listed marketing and communication company on the Nairobi Securities Exchange has reported a decline of 3.8 percent in its full year 2016 profit after tax to Sh 460.4 Million. It said the decline was on the back of a “one time spike in effective tax rate in 2015”.
The company’s profit before tax declined by 17 percent to Sh 725.9 Million compared to Sh 875.3 Million posted over the same period in 2015.
Total billings for the period under review declined slightly to Sh 16.3 Billion from Sh 16.8 Billion in 2015. The group’s total revenue on the other hand declined by 3.7 percent to Sh 4.8 Billion.
Operating profit came in at Sh 359.9 Million, a slightly higher figure when compared to Sh Sh 352.6 Million recorded in full year 2015. This was mainly as a result of a 4.2 percent decline in operating and administrative expenses.
WPP Scangroup, considered as the largest marketing and communication group operating a multi-agency model in Sub-Saharan Africa also mentioned that it “faced a tough operating environment in Kenya”, its largest market by revenues (60 percent of its total revenues). However, the toughness was offset by good growth in markets outside Kenya.
“Performance of operations outside Kenya were strong as we continue to develop these newer markets. Results in Gabon, Ghana, Nigeria and Zambia were particularly pleasing. In terms on disciplines, PR is where we saw the greatest growth.” said the company in a statement.
At sh 406.5 Million, Interest income was fairly strong when compared to Sh Sh 436 Million recorded in 2015. The drop was impacted by the capping of interest rates in Kenya which came into effect in the third quarter of 2016.
“2015 benefited from a foreign exchange gain of Sh 47 Million, whilst 2016 suffered from a loss of Sh 63 Million due to to devaluation, in particular the Nigerian Naira.” Noted the company.
