Chief Executive of WPP Group Martin Sorrell speaks at the Institute of Directors IOD annual convention in London
Chief Executive of WPP Group Martin Sorrell speaks at the Institute of Directors IOD annual convention in London.

Shares in WPP were down on the FTSE 100 in morning trading after the advertising group reported a rise in revenue and pre-tax profit in the full year ended 31 December 2010.

Revenue in the period increased seven per cent to £9.3 billion, while on a like for like basis the group saw revenue rise five per cent. Billings were up 12 per cent in the period to £42.7 billion.

Pre-tax profit in the period rose 27 per cent to over a billion pounds.

Following the results WPP said it would be raising its second interim dividend 15 per cent to 11.82 pence per share, taking the total dividend for the year up 15 per cent to 17.79 pence per share.

Richard Hunter, Head of UK Equities at Hargreaves Lansdown Stockbrokers, commented, "An admired business model and a respected CEO have conspired to ride the wave of US corporate recovery.

"The turnaround in WPP's fortunes is in marked contrast to the dark days of the financial crisis, with companies beginning to put some of their vast reserves of capital towards advertising their businesses. Quite apart from the improvement Stateside, other geographies also showed strong signs of profitability, such as China. Coupled with ongoing cost containment, a share buyback programme and another hike in the dividend, the only mild negative is the inevitable light bout of profit taking which has dented the shares in early trade.

"Taken in context, however, the selling is minimal - WPP shares have had a stellar run, having added 32% over the last year as compared to a wider FTSE100 gain of 9%. The general market view of the shares as a strong buy seems to have been vindicated once more."

By 09:25 shares in WPP were down 1.67 per cent on the FTSE 100 to 822.50 pence per share.