2020 INTERIM RESULTS 27 August 2020 CAUTIONARY STATEMENT REGARDING - - PowerPoint PPT Presentation

2020 INTERIM RESULTS

27 August 2020

This presentation contains statements that are, or may be deemed to be, “forward-looking statements”. Forward- looking statements give the Group’s current expectations or forecasts of future events. An investor can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as ‘anticipate’, ‘estimate’, ‘expect’, ‘intend’, ‘will’, ‘project’, ‘plan’, ‘believe’, ‘target’ and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. Other than in accordance with its legal or regulatory obligations (including under the Market Abuse Regulations, UK Listing Rules and the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority), the Group undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Investors should, however, consult any additional disclosures that the Group may make in any documents which it publishes and/or files with the US Securities and Exchange Commission (SEC). All investors, wherever located, should take note of these disclosures. Accordingly, no assurance can be given that any particular expectation will be met and investors are cautioned not to place undue reliance on the forward-looking statements. Forward-looking statements are subject to assumptions, inherent risks and uncertainties, many of which relate to factors that are beyond the Group’s control or precise estimate. The Group cautions investors that a number of important factors, including those in this presentation, could cause actual results to differ materially from those expressed or implied in any forward-looking statement. Such factors include, but are not limited to, those discussed under Item 3.D ‘Risk factors’ in the Group’s Annual Report on Form 20-F for FY 2019 and any impacts of the COVID-19

• pandemic. Any forward-looking statements made by or on behalf of the Group speak only as of the date they are

made and are based upon the knowledge and information available to the Directors on the date of this presentation.

2

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

2020 INTERIM RESULTS

1.

• 1. FIRST H

FIRST HALF H ALF HIGH IGHLIGHTS LIGHTS 2.

• 2. FINAN

FINANCI CIAL AL PE PERF RFOR ORMANCE MANCE 3.

• 3. BUSINESS

BUSINESS UPDATE UPDATE 4.

• 4. Q&A

Q&A

AGENDA

• Impact of COVID-19 significant. LFL revenue less pass-through costs -9.5% in H1:
• Jan/Feb -0.6%, March -7.9%, Q2 -15.1%, July -9.2%
• CPG/Tech/Pharma 56% of our business1, -0.7% in H1; Auto/Luxury/Travel 22%, -11.7%
• Agile and collaborative working with clients in a rapidly changing market:
• Technology and ecommerce in demand, PR less impacted
• c. $4 billion in new business, market-leading – Intel, HSBC, Unilever Media China
• Strong response from our people
• Good progress on cost savings, increased liquidity, net debt down significantly

year-on-year, reinstating interim dividend. Goodwill impairment of £2.5 billion

• Acceleration of our strategy

4

FIRST HALF: RESILIENT PERFORMANCE IN CHALLENGING ENVIRONMENT

2020 INTERIM RESULTS

• 1. Top 200 clients

FINANCIAL PERFORMANCE

6

UNAUDITED HEADLINE¹ IFRS INCOME STATEMENT

2020 INTERIM RESULTS

HA HALF F YE YEAR AR TO TO 30 30 JU JUNE NE 20 2020 20 £M 20 2019² 19² £M Δ REPORTE TED Δ LFL FL³ Continuing operations Revenue 5,583 6,368

• 12.3%
• 11.5%

Revenue less pass-through costs 4,668 5,199

• 10.2%
• 9.5%

Operating profit 382 617

• 38.1%

Income from associates

• 15
• 100%

PBIT 382 632

• 39.6%

Net finance costs (106) (138) 23.3% Profit before tax 276 494

• 44.2%

Tax at 23.1% (2019: 23.4%) (64) (112) 42.9% Profit after tax 212 382

• 44.6%

Non-controlling interests (21) (31) 30.8% Profit attributable to shareholders 191 351

• 45.8%

Diluted EPS 15.4p 28.0p

• 45.0%

Operating profit margin⁴ 8.2% 11.9%

• 3.7pt
• 3.7pt

EBITDA 480 731

• 34.4%
• Disposals account for 0.8%

reduction in revenue less pass- through costs with currency 0.1% favourable

• Associate income down by £15m

as benefit of Kantar investment

• ffset by COVID-19 related

downsides

• Diluted EPS from continuing
• perations down 45%

1 Figures before goodwill and intangibles charges, gains/losses on step-ups, gains/losses on disposals of subsidiaries and investments, investment and other write-downs, share of exceptional gains/losses of associates, restructuring and transformation costs, restructuring costs in relation to COVID-19, litigation settlement, gain on sale of New York freehold property and revaluation of financial instruments 2 2019 figures re-presented in accordance with IFRS 5 : Non-Current Assets Held for Sale and Discontinued Operations 3 Like-for-like growth at constant currency exchange rates and excluding effect

• f acquisitions and disposals

4 Margin as % of revenue less pass-through costs

7 2020 INTERIM RESULTS

2020 2019 Δ HALF YEAR TO 30 JUNE £M £M £M

Headline Operating Profit 382 617 (235) Goodwill impairment (2,521)

• (2,521)

Amortisation and impairment of intangibles (53) (53)

• Investment and other write-downs

(220)

• (220)

Restructuring and transformation costs (18) (34) 16 Restructuring costs in relation to COVID-19 (39)

• (39)

Gains on disposal of investments & subsidiaries 16 41 (25) Litigation settlement

• 17

(17) Gain on sale of freehold property in New York

• 8

(8) Non headline items (2,835) (21) (2,814) Reported Operating Loss/(Profit) (2,453) 596 (3,049)

RECONCILIATION OF HEADLINE OPERATING PROFIT TO REPORTED OPERATING PROFIT

• Investment write-downs

primarily relates to impairment

• f certain investments in

associates, including Imagina (£210m)

• Restructuring and

transformation costs relate to

• ngoing costs for the

continuing restructuring plan first outlined in December 2018

• COVID-19 restructuring costs

relate to severance actions taken in the second quarter as a response to the pandemic

• Gains on disposals includes

£15m on the disposal of the sports agency Two Circles

8 2020 INTERIM RESULTS

GOODWILL IMPAIRMENT

• Impairments of £2,741m (including £2,521m of goodwill impairments for subsidiaries and

£220m for associates shown as investment and other write-downs):

• The goodwill impairments relate to historical acquisitions whose carrying values have

been reassessed, triggered by the impact of COVID-19

• The impairments are driven by a combination of higher discount rates used to value

future cash flows, a lower profit base in 2020 and lower industry growth rates

Half Year £M Total Impairments Wunderman Thompson 1,071 VMLY&R 472 Geometry Global 233 Imagina (associate) 210 Landor & FITCH 158 Burson Cohn & Wolfe 129 Other 468 Total 2,741

GLOBAL INTEGRATED AGENCIES: MEDIA MORE IMPACTED THAN CREATIVE BUT VMLY&R STANDS OUT

H1 PERFORMANCE

• VMLY&R the best performer, close to

flat LFL in H1 reflecting improving business momentum since merger

• WT performed better than overall

GIA, again benefiting from creation

• f an integrated agency
• Hogarth production in strong

demand

• GroupM underperformed overall GIA,

due to closer correlation of its revenue to client media spend

• July net sales shows improvement to
• 9.2% LFL

1.7%

• 0.8%
• 2.6%
• 15.7%
• 20.0%
• 15.0%
• 10.0%
• 5.0%

0.0% 5.0% Q3 2019 Q4 2019 Q1 2020 Q2 2020

LFL REVENUE LESS PASS-THROUGH COSTS GROWTH

9 2020 INTERIM RESULTS

£M H1 2020 £M Δ REPORTED Δ LFL

Revenue less pass-through costs 3,462

• 10.3% -9.5%

Headline operating profit 256

• 44.8%

Headline operating margin 7.4%

• 4.6pt

PUBLIC RELATIONS: STRONGEST SECTOR, OPERATING PROFIT UP YEAR-ON-YEAR

H1 PERFORMANCE

• Good demand from clients for

strategic stakeholder communications

• Specialist PR strong performer,

achieving LFL growth; H+K Strategies best performing of major agencies

• Formation of Finsbury Glover

Hering to create a global leader in strategic communications

• July net sales shows

improvement to -2.7% LFL

• 0.9%
• 0.1%
• 1.4%
• 7.5%
• 10.0%
• 5.0%

0.0% Q3 2019 Q4 2019 Q1 2020 Q2 2020

LFL REVENUE LESS PASS-THROUGH COSTS GROWTH

10 2020 INTERIM RESULTS

£M H1 2020 £M Δ REPORTED Δ LFL

Revenue less pass-through costs 426

• 3.6% -4.5%

Headline operating profit 72 5.8% Headline operating margin 16.9% 1.5pt

SPECIALIST AGENCIES: MIXED PERFORMANCE WITH AKQA AND GEOMETRY RELATIVELY STRONG

H1 PERFORMANCE

• AKQA and Geometry relative
• utperformers, with focus on

experience and commerce

• GTB broadly in line despite
• ngoing drag from assignment loss
• Project-based work in Brand

Consulting suffered from short term budget cuts

• Events businesses and our

specialist airline agency heavily impacted in Q2

• July net sales shows improvement

to -12.5% LFL

• 3.4%
• 7.4%
• 7.4%
• 16.3%
• 20.0%
• 15.0%
• 10.0%
• 5.0%

0.0% Q3 2019 Q4 2019 Q1 2020 Q2 2020

LFL REVENUE LESS PASS-THROUGH COSTS GROWTH

11 2020 INTERIM RESULTS

£M H1 2020 £M Δ REPORTED Δ LFL

Revenue less pass-through costs 780

• 13.3% -11.8%

Headline operating profit 54

• 36.6%

Headline operating margin 7.0%

• 2.6pt

12

TOP 5 MARKETS¹

1. Top 5 markets for continuing operations 2. Like-for-like growth vs prior year from continuing operations 3. Includes Hong Kong and Taiwan

2020 INTERIM RESULTS

REVENUE LESS PASS-THROUGH COSTS GROWTH² 2020 July

• 6.1%
• 10.5%
• 7.2%
• 18.6%
• 15.5%

2020 H1

• 5.8%
• 14.2%
• 8.1%
• 11.7%
• 10.6%

2020 Q2

• 9.6%
• 23.3%
• 11.6%
• 3.1%
• 25.1%

2020 Q1

• 1.9%
• 4.2%
• 4.3%
• 21.3%

6.1% 2019 FY

• 6.0%

0.3%

• 0.3%
• 3.8%

9.7% USA UK Germany Greater China³ India

Headcount

19,000 10,000 7,000 8,000 8,000

13

OTHER MAJOR MARKETS

1. Like-for-like growth vs prior year from continuing operations

REVENUE LESS PASS-THROUGH COSTS GROWTH¹ 2020 July

• 13.8%

4.1%

• 14.3%
• 12.8%

2020 H1

• 16.7%
• 23.5%
• 7.9%
• 10.5%

2020 Q2

• 27.9%
• 29.9%
• 17.2%
• 18.7%

2020 Q1

• 4.0%
• 16.2%

3.8%

• 1.3%

2019 FY

• 7.1%
• 23.7%

0.0%

• 16.7%

France Italy Spain Brazil

Headcount

2,000 2,000 2,000 4,000

2020 INTERIM RESULTS

14

CHANGE IN HEADLINE¹ OPERATING MARGIN

Continuing operations, reportable £ actuals

2020 INTERIM RESULTS

2020 2019 Δ HALF YEAR TO 30 JUNE £M £M £M %

Net Sales 4,668 5,199 (531)

• 10.2%

Staff Costs (3,330) (3,503) 173 4.9% Establishment (315) (332) 17 5.3% IT (274) (264) (10)

• 3.6%

Personal (88) (165) 77 46.6% Other operating expenses (279) (318) 39 12.2% Operating expenses (4,286) (4,582) 296 6.5% Operating Profit 382 617 (235)

• 38.1%

Operating Profit Margin 8.2% 11.9%

• 3.7pt
• Reported net sales down by £531m or

10.2%

• Staff costs down by 4.9% with cost

actions increasing in second quarter

• Establishment costs down by 5.3%, but

IT increases by 3.6% due to investments

• Personal expenses down by 46.6% due

to reduced travel etc

• Other operating expenses down by

12.2%

• Net impact is for headline operating

profit to decline by £235m or 38.1%, with margin of 8.2% down by 3.7 margin points

• 1. Figures before goodwill and intangibles charges, gains/losses on step-ups, gains/losses on disposals of subsidiaries and investments, investment and other write-downs,

share of exceptional gains/losses of associates, restructuring and transformation costs, restructuring costs in relation to COVID-19, litigation settlement, gain on sale of New York freehold property

15

HEADLINE¹ COST SAVINGS BY MONTH

Continuing operations, reportable £ actuals Δ

2020 INTERIM RESULTS

HALF YEAR TO 30 JUNE Jan Feb Mar Apr May Jun H1

Staff Costs 0.2%

• 1.7%

6.4% 11.5% 12.8% 4.9% Establishment 12.1%

• 0.5%

3.4% 9.5% 2.5% 3.6% 5.3% IT

• 8.0%
• 3.1%
• 17.7%

0.9%

• 1.2%

6.9%

• 3.6%

Personal 0.8%

• 4.0%

31.4% 80.1% 81.0% 78.6% 46.6% Other operating expenses 1.0% 13.2% 11.6% 18.5% 10.5% 16.0% 12.2% Operating expenses 0.7% 0.5%

• 0.2%

9.9% 12.7% 14.6% 6.5% Opex reduction/net sales Q1 Q2 H1 Q1/Q2/H1 7.5% 67.7% 55.8%

• First quarter saw minimal cost

savings with COVID-19 hitting net sales from March onwards

• Significant cost reduction from April
• nwards with immediate reduction

in personal expenses (travel) and staff costs

• Staff cost reductions increasingly

from permanent actions

• On track to achieve upper end of

the £700-800m target savings

• Approximately one quarter of these

savings will be permanently retained when we have returned to 2019 net sales levels

• 1. Figures before goodwill and intangibles charges, gains/losses on step-ups, gains/losses on disposals of subsidiaries and investments, investment and other write-downs,

share of exceptional gains/losses of associates, restructuring and transformation costs, restructuring costs in relation to COVID-19, litigation settlement, gain on sale of New York freehold property

16

FREE CASH FLOW AND FREE CASH FLOW CONVERSION

2020 INTERIM RESULTS

HALF YEAR TO 30 JUNE 2020 £M 2019 £M

Operating profit (2,443) 673

• Continuing Operations

(2,453) 596

• Discontinued Operations

10 77

Depreciation & amortisation charges 306 360

• Depreciation & amortisation ex IFRS 16

151 192

• Depreciation of right-of-use assets

155 168

Impairments and investment write-downs 2,741

• Lease payments (including interest)

(203) (156) Non-cash compensation 31 33 Working capital, other receivables, payables and provisions (751) (779)

• Working capital

(456) (297)

• Other receivables, payables and provisions

(295) (482)

Net interest paid & similar charges (32) (75) Tax paid (201) (261) Capital expenditure (141) (167) Earnout payments (88) (58) Other (44) (83) Free cash outflow (825) (513)

17

USES OF CASH FLOW

• 1. 2020 represents proceeds from disposals of investments and subsidiaries, 2019 includes proceeds from disposals of property, plant & equipment (£167m), and investments and subsidiaries (£137m)
• 2. Net initial payments are net of cash acquired, and includes other investments and associates

2020 INTERIM RESULTS

HALF YEAR TO 30 JUNE 2020 £M 2019 £M

Free cash outflow (825) (513) Net disposals/(acquisitions) ex earnout payments 161 278

• Disposal proceeds¹

207 304

• Net initial payments²

(46) (26)

Net cash outflow before distributions (664) (235) Distributions to shareholders (286)

• Dividends
• Share buybacks

(286)

• Net cash outflow

(950) (235)

18

SIGNIFICANT IMPROVEMENT IN NET DEBT¹ SINCE 30 JUNE 2019 (£M)

Notes:

• 1. Itemised movements in net debt represent management figures, which may vary from the presentation of the cash flow under IFRS
• 2. Acquisitions/disposals include earnout payments
• 3. Dividends to shareholders
• 4,271
• 2,726

2020 INTERIM RESULTS

19

LEVERAGE METRICS

Continuing operations

• 1. Net debt, headline finance costs, interest cover, headline EBITDA, exclude impact of IFRS 16
• 2. Headline finance costs of £56m (2019: £90m) excludes £50m (2019: £48m) IFRS 16 impact of all leases

2020 INTERIM RESULTS

HALF YEAR TO 30 JUNE 2020 £M 2019 £M Δ £M £M

Average net debt¹ on constant currency basis (2,496) (4,460) 1,964 Average net debt¹ on reportable basis (2,496) (4,384) 1,888 Net debt¹ at 30 June on constant currency basis (2,726) (4,382) 1,656 Net debt¹ at 30 June on reportable basis (2,726) (4,271) 1,545 Available liquidity at 30 June 4,714 3,564 1,150 Headline finance costs¹,² (56) (90) 34 Interest cover¹ on headline operating profit 6.8x 6.9x Headline EBITDA¹ 480 731 (251) Rolling 12 month headline EBITDA¹ 1,579 1,857 (278) Rolling average net debt/headline EBITDA¹ 2.1x 2.5x

• 2019 final dividend cancelled; maintaining lower leverage to offset

COVID-19 impact on profitability and cash flow

• Interim dividend of 10p declared
• Share buyback remains under review; intention to restart when

environment stabilises

• Capital markets event later this year to outline capital allocation plans

20

DIVIDEND AND BUYBACK UPDATE

2020 INTERIM RESULTS

• 2020 financial performance expected to be within the range of current market

expectations: ▪ LFL revenue less pass-through costs -10.0% to -11.5% ▪ Headline operating margin 10.4% to 12.5%

• Small working capital outflow for the full year
• Capex c. £300m
• Average net debt/EBITDA in range 1.5-1.75x by end of 2021

21

2020 GUIDANCE

2020 INTERIM RESULTS

BUSINESS UPDATE

• Vision and offer
• Strong performance in digital media and commerce
• New business and retention
• Creativity
• Hired new creative talent
• Effies win for ninth successive year
• Cannes Lions Holding Company of the Decade
• Data and technology
• Leader in Forrester’s Adobe Implementation Services Wave
• >20,000 partner accreditations from Adobe, Amazon, Facebook, Google, Salesforce
• Simpler structure
• VMLY&R and Wunderman Thompson our best-performing integrated agencies
• Creation of Finsbury Glover Hering
• 7 further disposals
• Culture
• Key hires at Ogilvy and GroupM
• Set out comprehensive inclusion and diversity strategy; formed global Inclusion

Council

23

DURING LOCKDOWN, WE CONTINUE TO MAKE PROGRESS ON OUR STRATEGY

2020 INTERIM RESULTS

Automotive 13% Luxury, Premium 6% Travel, Leisure 3%

24

CRITICAL PARTNER TO OUR CLIENTS

Note: all figures relate to LFL revenue less pass-through costs from WPP’s top 200 designated clients attributable to each industry for continuing operations in H1, and include an allocation of GroupM trading revenue less pass- through costs. These clients comprise 64% of WPP total revenue less pass-through costs, and 82% of total designated clients for H1 2020 on this basis.

2020 INTERIM RESULTS

SI SIGNIFI FICANT CANTLY Y IMPACTE ACTED

22% 22%

BAL ALAN ANCED CED RESP RESPONSE SE

22% 22%

MORE MORE RE RESIL SILIENT

56% 56%

• 18.7% in Q2

Telco, Media, Ent 7% Retail 6% Financial services 4% Other 5%

• 7.7% in Q2

CPG 26% Tech 18% Healthcare, Pharma 12%

• 4.4% in Q2
• 4.6% in Q1

+2.6% in Q1 +3.6% in Q1

Top 200 clients +1.4% in Q1, -8.4% in Q2

ACCOUNT M/C REGION WPP AGENCY BILLINGS $M

M Global 300 Prod Global 802

25

SIGNIFICANT WINS, LIMITED LOSSES

Note: trade-reported numbers 1. Media/Creative 2. Billings equivalent 2020 INTERIM RESULTS

ACCOUNT M/C2 REGION WPP AGENCY BILLINGS $M

C Global 800 M China 500 M Global 350 C Global 400 C NA 258 M Global 225 C & M Global 150 M Global 84 C APAC 51 M UK 32

Wins Losses

26

LEADING IN NEW BUSINESS Q2 AND YTD

WPP 27

COVID-19 IS ACCELERATING EXISTING TRENDS

• 1. GroupM: This Year, Next Year (June 2020)
• 2. Nielsen
• 3. Benenson Strategy Group

ECOMMERCE: 4-6 YEAR ACCELERATION

• UK ecommerce now 30%

up from 19% (July)

• China ecommerce now

32% from 24% (July)

• USA ecommerce at 20%

from 14% (Q2)

• Packaged good

companies reporting 10- 15% ecommerce share and 50%+ growth

MEDIA MIX: DIGITAL NOW DOMINATES

• Digital rising to 54% of

mix in 2020 (2019: 48%)1

• Shift in consumption

patterns: US internet video +63% YoY in Q22

• ROI and attribution more

important than ever

PURPOSE AND ESG: RISING UP THE AGENDA

• Complex

communications issues facing CEOs and companies – COVID-19, racial justice, safety of social media platforms

• 84% of consumers will

judge companies by how they respond3

2020 INTERIM RESULTS

28

ACCELERATING GROWTH IN EXPERIENCE, COMMERCE AND TECHNOLOGY

COMMUNICATIONS EXPERIENCE TECHNOLOGY COMMERCE

2020 INTERIM RESULTS

WPP’S OFFER

STRATEGIC, TECHNICAL AND CREATIVE SUPPORT ON ECOMMERCE

29

PLATFORM

• One of the world’s

largest roll-outs of Adobe’s B2C commerce platform

• D2C for new category

global expansion

• Organisational

enablement and technology delivery

• Supported by toolkits,

training and key hires

MULTI-CHANNEL

• All-new Bronco

reveal

• Innovative launch

across media, creative, comms, commerce and tech

• Film-quality content,

3 mins not 30 secs

• Full pre-configure

and pre-order

• 165k pre-orders

D2C MARKETPLACES

2020 INTERIM RESULTS

• Performance

marketing, paid media for first and third party ecommerce

• Amazon search and

display

• Broadening ecomm

scope in existing markets

• Ecomm sales +93% in

Q2

• Launch and
• ptimisation of Lever,

featuring trusted Unilever Brands

• Focus on sustainable

living and supporting local community needs

• Programme mgmt.

from WT Commerce, supported by media and ecommerce-ready design

Actively engaged with 8 of our top 10 clients on ecommerce

30

ECOMMERCE INCREASINGLY DRIVING MEDIA SPEND

DIGITAL % OF GROUPM BILLINGS

+39% +39%

Up 5.5 pt in H1 to $7.4 billion

CPG ECOMM MEDIA BUDGETS TYPICALLY

2x 2x

Post COVID

CP CPG G CLI CLIEN ENT TY T TYPICAL CAL ECO ECOMM MM SALES ALES INCR CREASE EASE

100 00%+

%+

Post COVID

ECOMM BILLINGS YOY GROWTH

19 19%

ECOMM INCREASINGLY A MULTI-PLATFORM STRATEGY

Now 18% of digital, $1.4 billion in H1

WITH TH S SOME OME MUCH CH HIGH GHER ER

2020 INTERIM RESULTS

31

PURPOSE RISING UP THE CORPORATE AGENDA

• Pfizer’s goal is to lift reputation as a

patient-focused scientific leader within the Biopharma industry

• Campaign results:
• 55% of viewers have more favourable

view of Pfizer

• 40% have more favourable view of

Pharma overall

• Best earned media outcome for many

years

2020 INTERIM RESULTS

WPP

• P&G The Pause aimed to help

educate people about the unspoken hesitation and anxiety that members of the LGBTQ+ community face in their everyday interactions

• 5.2 million views on YouTube and

34 million views on Twitter

• 82.6 million social impressions and

1.8 million social reach

PURPOSE RISING UP THE CORPORATE AGENDA

32 2020 INTERIM RESULTS

WPP 33

EMBRACING INCREASED SPEED AND AGILITY

• More client engagement, less travel, much faster

delivery times

• Huge uptake of collaborative tools:
• 6x increased usage of Teams
• WPP employee survey:
• 91% believe they have the resources and technology

available to do their job

• 92% satisfied with internal communication
• 89% feel they are part of a team

BUT:

• 32% feel that their effectiveness is more than a little

impacted – work/life balance, more meetings, blurred boundaries

2020 INTERIM RESULTS

• Resilient performance, Q2 the toughest quarter; cautious on speed
• f recovery
• COVID-19 accelerating industry changes. We have the right strategy
• Clients value our advice and services more than ever
• Looking to embed lessons of lockdown:
• Faster, more agile ways of working
• Less travel
• Permanent cost reductions
• Capital markets event in Nov/Dec to update on progress against

December 2018 strategy

SUMMARY

34 2020 INTERIM RESULTS

Q&A

OTHER FINANCIAL INFORMATION

37

UNAUDITED IFRS INCOME STATEMENT

1. 2019 figures re-presented in accordance with IFRS 5 : Non-Current Assets Held for Sale and Discontinued Operations 2. Figures before goodwill and intangibles charges, gains/losses on step-ups, gains/losses on disposals of subsidiaries and investments, investment and other write-downs, share of exceptional gains/losses of associates, restructuring and transformation costs, restructuring costs in relation to COVID-19, litigation settlement, gain on sale of New York freehold property and revaluation of financial instruments

2020 INTERIM RESULTS

HAL ALF YE YEAR AR TO 30 0 JUN JUNE 2020 2020 £M 2019¹ £ 2019¹ £M Δ REPORTED Δ CO CONSTAN ANT CUR CURRENCY CY

Continuing operations Revenue 5,583 6,368

• 12.3%
• 12.4%

Gross profit 778 1,039

• 25.1%
• 25.6%

Operating profit pre exceptional & goodwill/intangibles² 382 617

• 38.1%
• 38.8%

Net exceptional (loss)/gain (261) 32

• Goodwill/intangible charges

(2,574) (53)

• Operating (loss)/profit

(2,453) 596

• 511%
• 528%

Income from associates

• 15
• 100%
• 100%

Share of associate exceptional loss (52) (13)

• PBIT

(2,505) 598

• 519%
• 536%

Net finance costs (76) (189) 59.7% 59.9% (Loss)/profit before tax (2,581) 409

• 731%
• 761%

Tax (24) (109) 78.0% 78.2% (Loss)/profit after tax (2,605) 300

• 969%
• 1011%

Non-controlling interests (21) (31) 30.8% 26.8% (Loss)/profit attributable to shareholders: Continuing ops (2,626) 269

• 1076%
• 1123%

Discontinued ops (7) 43

• 116%
• 116%

Total (2,633) 312

• 943%
• 983%

Total reported diluted EPS (214.5p) 21.4p

• 1102%
• 1150%
• Share of associate

exceptional loss of £52m (2019: £13m) primarily comprises £27m of amortisation and impairment of acquired intangibles, and £23m of

• ne-off transaction costs

within Kantar

• Net finance costs includes

£30m income (2019: £50m loss) from revaluation of financial instruments, of which £26m relates to revaluation of put options

Q1 Q1 Q2 Q2 H1 H1

• 9.5%
• 0.8%

0.1%

• 10.2%

LFL 38

REVENUE LESS PASS-THROUGH COSTS GROWTH VS PRIOR YEAR

2020 INTERIM RESULTS

• 3.3%

0.5% 1.8%

• 1.0%

LFL Acquisitions/ disposals FX Reported

• 15.1%
• 0.9%

0.4%

• 15.6%

Acquisitions/ disposals FX Reported Acquisitions/ disposals FX Reported LFL Continuing Operations:

39

REVENUE LESS PASS-THROUGH COSTS BY SECTOR

2020 INTERIM RESULTS

HALF YEAR TO 30 JUNE 2020 £M 2019 £M Δ REPORTED Δ LFL

Global Integrated Agencies 3,462 3,858

• 10.3%
• 9.5%

Public Relations 426 442

• 3.6%
• 4.5%

Specialist Agencies 780 899

• 13.3%
• 11.8%

Total Continuing Operations 4,668 5,199

• 10.2%
• 9.5%

40

REVENUE LESS PASS-THROUGH COSTS BY REGION

2020 INTERIM RESULTS

HALF YEAR TO 30 JUNE 2020 £M 2019 £M Δ REPORTED Δ LFL

North America 1,856 1,951

• 4.9%
• 6.1%

UK 586 692

• 15.4%
• 14.2%

Western Continental Europe 920 1,042

• 11.7%
• 11.7%

Asia Pacific, Latin America, Africa & Middle East and Central & Eastern Europe 1,306 1,514

• 13.7%
• 10.1%

Total Continuing Operations 4,668 5,199

• 10.2%
• 9.5%

41

REVENUE LESS PASS-THROUGH COSTS GROWTH¹ BY REGION LIKE-FOR-LIKE %

• 1. Continuing operations

2020 INTERIM RESULTS % Q1 Q2 H1 July Mature Markets

• 2.8
• 15.2
• 9.2
• 7.5

Faster Growing Markets

• 4.6
• 14.8
• 10.1
• 13.3

Total

• 3.3
• 15.1
• 9.5
• 9.2

North America % Q1 Q2 H1 July

• 1.9
• 10.2
• 6.1
• 6.2

UK % Q1 Q2 H1 July

• 4.2
• 23.3
• 14.2
• 10.5
• W. Cont. Europe %

Q1 Q2 H1 July

• 3.7
• 18.8
• 11.7
• 7.7

Africa & M. East % Q1 Q2 H1 July 7.3

• 19.0
• 6.9
• 16.0
• C. & E. Europe %

Q1 Q2 H1 July 4.7

• 7.0
• 1.5
• 0.7

Asia Pacific % Q1 Q2 H1 July

• 8.6
• 14.0
• 11.5
• 15.3

Latin America % Q1 Q2 H1 July

• 2.0
• 18.9
• 11.2
• 10.8

42

BRIC MARKETS

1. Like-for-like growth vs prior year from continuing operations 2. Includes Hong Kong and Taiwan

2020 INTERIM RESULTS

REVENUE LESS PASS-THROUGH COSTS GROWTH¹ 2020 July

• 18.8%
• 18.6%
• 12.8%
• 15.5%
• 15.7%

2020 H1

• 9.2%
• 11.7%
• 10.5%
• 10.6%

5.4% 2020 Q2 3.5%

• 3.1%
• 18.7%
• 25.1%
• 0.1%

2020 Q1

• 23.4%
• 21.3 %
• 1.3%

6.1% 11.5% 2019 FY

• 4.0%
• 3.8%

9.3% 9.7% 7.9% Mainland China Greater China² Brazil India Russia

Headcount

6,000 8,000 4,000 8,000 1,000

43

HEADLINE¹ OPERATING PROFIT AND MARGIN

By Sector

1 Figures before goodwill and intangibles charges, gains/losses on step-ups, gains/losses on disposals of subsidiaries and investments, investment and

• ther write-downs, share of exceptional gains/losses of associates, restructuring and transformation costs, restructuring costs in relation to COVID-19,

litigation settlement, gain on sale of New York freehold property 2 Margin as % of revenue less pass-through costs

2020 INTERIM RESULTS

OPERATING PROFIT £M OPERATING MARGIN² HALF YEAR TO 30 JUNE 2020 2019 2020 2019

Global Integrated Agencies 256 463 7.4% 12.0% Public Relations 72 68 16.9% 15.4% Specialist Agencies 54 86 7.0% 9.6%

Total Continuing Operations

382 617 8.2 .2% 11.9% .9%

44

HEADLINE¹ OPERATING PROFIT AND MARGIN

By Region

1 Figures before goodwill and intangibles charges, gains/losses on step-ups, gains/losses on disposals of subsidiaries and investments, investment and

• ther write-downs, share of exceptional gains/losses of associates, restructuring and transformation costs, restructuring costs in relation to COVID-19,

litigation settlement, gain on sale of New York freehold property 2 Margin as % of revenue less pass-through costs

2020 INTERIM RESULTS

OPERATING PROFIT £M OPERATING MARGIN² HALF YEAR TO 30 JUNE 2020 2019 2020 2019

North America 215 278 11.6% 14.3% UK 35 87 6.1% 12.5% Western Continental Europe 44 96 4.8% 9.3% Asia Pacific, Latin America, Africa & Middle East and Central & Eastern Europe 88 156 6.7% 10.3%

Total Continuing Operations

382 617 8.2 .2% 11.9% .9%

45

CLIENT SECTOR MIX

• 1. % of total top 200 designated clients attributable to each industry for continuing operations. These comprise

64% of WPP total revenue less pass-through costs, and 82% of total designated clients for H1 2020

CPG 26% Automotive 13% Tech 18% Healthcare & pharma 12% Telecom, media & entertainment 7% Retail 6% Other 5% Financial services 4% Luxury & premium 6% Travel & leisure 3%

2020 INTERIM RESULTS

DEBT MATURITY PROFILE £M AT JUNE 30, 2020

Exchange Rates £/$ 1.2379 £/€ 1.1010 £/A$ 1.7966 1. Swapped to £444m at 2.61%

Weighted Average Coupon 2.8% Weighted Average Maturity 8.1 years Available Liquidity £4,714M

£ TOTAL CREDIT £ TOTAL DRAW AWN

◼ £ bonds £400m (2.875% Sep ’46)

400 400

◼ US bond $220m (5.625% Nov ’43)

178 178

◼ US bond $93m (5.125% Sep ’42)

75 75

◼ £ bonds £250m (3.75% May ’32) NEW

250 250

◼ Eurobonds €600m (1.625% Mar ’30)

545 545

◼ Eurobonds €750m (2.375% May ‘27) NEW

681 681

◼ Eurobonds €750m (2.25% Sep '26)

681 681

◼ Eurobond €500m (1.375% Mar ‘25)/£444m Swap1

444 444

◼ US bond $750m (3.75% Sep '24)

606 606

◼ Eurobonds €750m (3.0% Nov ’23)

681 681

◼ US bond $500m (3.625% Sep ’22)

404 404

◼ Eurobond €250m (3m EURIBOR + 0.45% Mar ’22)

227 227 Debt t Faciliti ties 5,172 5,172 Other facilities 2,254 122 Net cash, overdrafts & other adjustments – (2,568) Total Borrowing Capacity ty / Net Debt 7,42 426 2,726

100 200 300 400 500 600 700

New €750m Bond Issue New £250m Bond Issue 46

47 2020 INTERIM RESULTS

FY TARGET JUNE YTD 2020 JUNE YTD 2019 FY 2019

(Disposals)/acquisitions (excluding earnouts): Acquisitions¹

• c. £200M

£46M £26M £94M Less disposals²

• c. £(200M)

£(207M) £(304M) £(2,315M) Net (disposals)/acquisitions NEUTRAL £(161M) £(278M) £(2,221M) Share buybacks: % of issued share capital

• £286M

2.6%

• £44M

0.4% Balance Sheet Headroom: Undrawn facilities & surplus cash

• £4.7B

£3.6B £4.8B Average net debt at 2020 exchange rates

• £2.5B

£4.4B £4.3B 30 June net debt at 2020 exchange rates £2.5B £4.5B £4.5B³

USES OF FREE CASH FLOW

• 1. Acquisitions are initial payments, net of cash acquired, and include other investments and associates
• 2. 2020 represents proceeds from disposals of investments and subsidiaries, H1 2019 includes proceeds from disposals of property, plant & equipment (£167m), and investments and subsidiaries (£137m), FY 2019 includes proceeds

from disposals of property, plant & equipment (£174m), investments and subsidiaries (£2,468m), less cash on disposals (£327m)

• 3. FY 2019 net debt stated at 2019 actual exchange rates

48

EFFECTS OF CURRENCY

1. Effects of currency on continuing operations

2020 INTERIM RESULTS

FIRST HALF 20 2020 20 20 2019 19 STERLING (WE (WEAK AKER)/S )/STRON TRONGER

US$ 1.26 1.29

• 2%

€ 1.14 1.15

• 1%

Chinese Renminbi 8.86 8.78 1% Brazilian Real 6.17 4.97 24% Australian $ 1.92 1.83 5% Canadian $ 1.72 1.73

• 1%

Indian Rupee 93 91 2% Singapore $ 1.76 1.76

• South African Rand

20.9 18.4 14%

• Currency movements

accounted for 0.1% increase¹ in revenue less pass-through costs

• £ sterling not moved

significantly against US$, € and Chinese Renminbi

1.2%

• 0.3%

0.4%

• 3.7%
• 0.7%
• 1.1%
• 4%
• 2%

0% 2%

19/FY Act 20/Q1 Act 20/Q2 Act 20/Q3 Est 20/Q4 Est 20/FY Est

49

IMPACT OF FX ON REVENUE LESS PASS-THROUGH COSTS¹

• 1. Continuing operations

2.July run at actual average exchange rates, August to December uses 12 August 2020 exchange rates (£:$1.30, £:€1.11)

• 2020 H1 currency

tailwind 0.1%

• 2020 full year

headwind -1.1% at latest exchange rates²

• 2019 full year currency

tailwind 1.2%

2020 INTERIM RESULTS