Something to sink your teeth into before lunch: more discounts on dining out.
Restaurants are extending their offer of discounted meals in the government’s eat out to help out scheme after it ends on 31 August because of its popularity with diners, although the eateries will have to cover the costs themselves.
In September, consumers will be able to take advantage of reduced prices at nationwide chains including Harvester, Toby Carvery, Tesco Café, Bill’s, Pizza Hut and Prezzo.
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There’s more from WPP, the world’s biggest advertising agency, which announced a big writedown on the value of previous acquisitions, and a big loss, but still beat market expectations.
Chief executive Mark Read was speaking to reporters this morning. Asked if the multi-billion pound write-down was the fault of Sorrell, who has always had a penchant for making the big deal, Read said:
I don’t think we are saying that. It relates primarily to Y&R Group, before my time, which was acquired in 2000 at the height of the market in a stock transaction when both Y&R and WPP group’s stock were also high.
WPP’s figures show that the UK is proving to be one of the worst hit ad markets in the world, with revenues down 23% in the second quarter.
By contrast, WPP’s finance chief John Rogers said that the US, the world’s biggest ad market by some distance, has proven to be the “outlier” with revenues down just 9.6% in the second quarter despite the ongoing impact of the pandemic.
WPP’s share price is up by 4.6% % in early trading as investors warmed to the better-than-expected news.
WPP has reported a £2.6bn loss in the first half after the impact of the pandemic prompted the company to wipe billions off the value of expensive advertising acquisitions made by founder and former chief executive sir Martin Sorrell.
However, the world’s largest advertising group, which has shed 5,000 jobs in the first six months, surprised investors by re-instating its dividend declaring that the worst is now behind it, assuming there is no second wave of the virus.
Shares gained 4.6%, leading the FTSE 100 after the company beat city expectations to report a fall in adjusted revenues of 9.5% in the first half – peaking with a 15% fall in the second quarter, and a 44% fall in headlong pre-tax profits was also better than feared.
WPP’s loss was mainly down to the decision to write-down the value of certain advertising agency assets in light of the impact of Covid-19. The majority of the £2.5bn non-cash write down of ad assets relates to purchase of Young & Rubicam in 2000. The global agency group was acquired by Sorrell in a $4.5bn stock deal, which propelled WPP to become the world’s biggest marketing service group.
Mark Read, WPP’s chief executive, said:
Assuming there is no second wave nor major lockdowns, the second quarter is expected to be the toughest period of the year, although we remain cautious on the speed of the recovery.
The company, which is seeking to make cost savings of £700m to £800m this year, said that its headcount has dropped from 106,000 to 101,000 in the first half due to voluntary leavers who haven’t been repacked and redundancies.
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