WPP plc (WPP) Q2 2026 Earnings Call Transcript

Good morning, and welcome to WPP's 2026 Interim Results. I'm Tom Singlehurst, Head of Investor Relations, and I'm joined today by Cindy Rose, CEO, and Joanne Wilson, CFO. Before we get started, please take a moment to review the important cautionary statement on slide two. Let me also quickly take you through our agenda. We'll start with an overview of key messages, as well as an update on strategic progress from Cindy. Joanne will then review the H1 numbers in more detail. we will then open up the lines for Q&A. And with that, I'll hand over the call to Cindy.

Good morning, everyone. Thank you so much for joining us today. When we reported our 2025 full-year results back in February, I laid out in detail our Elevate28 strategy. I made a commitment that we would be transparent about our progress along the way, forthcoming with lead indicators of our momentum, and disciplined in how we measure success. Today, I'll share an update on where we are against the plan and why I'm encouraged by the steady improvements we're delivering across the company. Then I'll hand over to Joanne who will take you through the financial detail. Before I start I'd like to pay a personal tribute to Paul Richardson who recently passed away. Paul served as WPP's group finance director for 22 years until he retired from the company in 2019. He joined WPP in 1993 as group treasurer and over nearly three decades played a central role in helping to build WPP into the global company it is today. I know many of you will have fond memories of working alongside Paul and will have also known him personally. Our thoughts are with his family at this time. Coming back to where we are today, the headline is that we're on track with where we said we would be, stabilizing the business and delivering on our ambitions with clear evidence of progress across all leading indicators. As part of Elevate 28, we aligned on a new company purpose, to be the trusted growth partner for the world's leading brands. And to fulfill this new purpose, we announced four strategic objectives, to deliver superior growth for clients, to become a simpler, more integrated company, to unlock the advantage of WPP Open, our agentic marketing platform, and to create firm financial foundations for the future. We also outlined a detailed execution plan that spans three distinct phases. The priority in 2026 has been to stabilize the business, make the structural changes needed and strengthen our execution. The next phase is to build on these foundations, returning the company to growth sometime during 2027. And the third phase will be accelerating our growth so we can win our share of a growing market from 2028 and beyond. The building blocks of the new strategy are now firmly in place. We're moving from a holding company model to a single company model with four operating units, creative, media, production and enterprise solutions that operate across four regions with common incentives aligned to WPP's overall performance, all underpinned by WPP Open, which enables and connects everything we do. We've made encouraging progress. Today, we are a simpler, more integrated company, but our work is by no means complete, and our focus remains firmly on execution and delivering against the commitments that we've made to our clients, employees, and investors. The journey ahead won't be linear, and there will undoubtedly be ups and downs along the way, but I'm confident that we are on the right path and setting WPP up for sustainable success well into the future. In May 2025, we launched WPP Media, then WPP Production in January this year, WPP Creative in February, and to complete the reorganization on July 1st, we officially launched WPP Enterprise Solutions to the market, a unified technology-powered services offer that helps our clients modernize their marketing operations and unlock new sources of growth. Let's have a quick look at WPP Enterprise Solutions.

Great work is only as strong as the system behind it.

Businesses grow when they drive purchases. They grow faster when their experiences feel effortless.

We are fixated on making intelligent, streamlined experiences for owners.

They grow deeper when they humanize relationships. Hyperpersonalization at scale. They grow broader when their stories connect with audiences. you can have an intelligent, interactive, personalized conversation with the site. They grow stronger when platforms power everything.

Turn data to the most important tool in the construction industry.

In a world where AI is leading the way, every global business needs a partner who can reimagine what's next, build new systems, and forge new paths to growth. We design, build, and operate growth systems.

We are WPP Enterprise Solutions.

As AI reshapes our industry, the winners will be those companies that can effectively embed technology directly into their marketing operations, put data and AI to work to gain a deeper understanding of their consumers, reimagine workflows, and skill their workforce. We believe WPP Enterprise Solutions is unique and differentiated because it's not a separate company that sells bolt-on services. It's been built from within and remains deeply integrated with our creative media and production businesses. Enterprise Solutions brings together commerce, customer experience, CRM, content transformation and leverages our deep technology partnerships to help design, build and operate the growth systems that our clients rely on. The business is now live in the market and already partnering with global brands such as Ikea, Ford, L'Oreal and Nestle to deliver marketing modernization and business transformation. In April of this year we launched WPP's commerce practice. This is a cross company connected practice that unifies our capabilities across creative commerce, media, enterprise solutions and high velocity production under dedicated global leadership. Commerce is no longer just a channel. It is the ultimate organizing principle for modern marketing, with global commerce ad spend now surpassing total TV advertising. Our commerce practice will enable us to capture this massive market opportunity without adding complexity or overhead. Our talent remains embedded within their agency homes while seamlessly connecting across the entire group using WPP Open. It's yet another decisive step in removing internal silos and simplifying how we go to market and ensuring we deliver the connected outcome-driven growth that our clients need and want. In June of this year, WPP once again triumphed at the CanLion Festival of Creativity. That achievement matters, not just because of the recognition, but because of what it says about the strength and breadth of our offer and the enduring importance of human creativity. For our clients, the value is enormous. They can now access the number one global network in Ogilvy, the number two network in VML, the number one global PR agency in Burson, and the most awarded media group in WPP Media. Together, that combination is a significant differentiator for our business and a powerful proof point of the world-class talent and capability that WPP offers. So as I've said, we've made encouraging progress in many areas, and I couldn't be prouder or more grateful to my team for the incredible work that they're doing across the board. We're six months into a three-year plan. Phase one is about stabilizing our performance, arresting the decline, building momentum, and demonstrating that the changes we've made are translating into tangible results. At our full year results in February, I said organic growth was a lagging indicator and that we expect the first half revenues to be down mid to high single digits. We've delivered in line with this guidance at minus 4.7 percent like-for-like net sales for H1. And while this shows the continued impact of historical client losses, it is in line with our expectations. And I'm encouraged by the improving trajectory quarter over quarter, with Q1 at minus 6.7% like for like net sales growth and Q2 improving to minus 2.8%. I also said that while we would execute cost savings initiatives and deliver around 100 million pounds of in-year savings, we would reinvest this into growth initiatives. I'm pleased that we're making these investments while delivering broadly stable margins in the first half. Joanne will take you through the numbers in detail shortly, but these results underline that the actions we're taking are having a positive impact on our main financial metrics. As we outlined earlier this year, it will take some time for the impact of these changes to fully flow through our numbers. So what I want to focus on with you today are the leading indicators that demonstrate our strategy is working and also look at the areas where we need to continue evolving to ensure we deliver on our plan. At our strategy day, I shared the leading indicators that my team and I hold ourselves accountable for. New business wins, client retention, strategic technology partnerships, cost savings, and portfolio discipline. So let me briefly update you on each. In Q4 2025, WPP was number one in J.P. Morgan's net new business rankings for the first time since 2020. And I'm pleased to say that the momentum has continued, with WPP topping the rankings as number one for net new business, for H1 2026, and for the nine months to Q2 2026. That's thanks to some landmark wins, including the Estee Lauder companies, Jaguar Land Rover, Henkel, Just Eat, Bet365, Fuse T, Airbnb, SC Johnson, Wendy's, Heineken, Honda, and more. But beyond these headlines, what matters to me is how we're winning. These are integrated multidisciplinary mandates awarded to WPP as one team. This is the direct result of the strategic changes we've made to our client proposition. Just a few examples to bring this to life. Wendy's appointed WPP Media as their U.S. media partner, building on a 14-year creative relationship with VML. That's a client choosing to consolidate with us because of the benefits of integration. Natura and Avon consolidated their marketing activities in Latin America for the first time, awarding their business to a combined team of VML David, FBiz, and WPP Media, creative production media and enterprise solutions all together, one brief, one team. And the Coca-Cola company awarded us the Diet Coke business across EMEA for a brief spanning creative, social and influencer marketing expanding on our existing media relationship. Again, these wins demonstrate that when we show up as one WPP, media led, data and technology enabled, structurally integrated with creativity at our heart, we are the growth partner of choice for the world's leading brands. But market share growth doesn't come from winning new business alone, right? That's only part of the story. What's also critical is how we retain and grow the partnerships we have with our valued portfolio of existing clients. I'm pleased that we've improved on our client retention rates in the first half of this year, which included Huawei in China, Tesco in the U.K., L'Oreal in Australia and New Zealand, Skechers across multiple markets globally, Rekit in India, Toyota in Europe, and many more. I strongly believe that by bringing more operational discipline to our client engagement model, we can drive even further improvements in this area. This will be a key focus for us in the second half of this year and into next year as we stand up a holistic client success program. This program will be organized around three areas. systems that give us a single view of our client relationships and a data-driven approach to performance tracking, process that formalizes our approach to governance and client management, including success metrics and joint business planning, and people to build the critical capabilities, leadership skills, and mindset needed to meet and exceed client expectations. This framework will create a more systematic approach to client lifecycle management, bringing greater operational discipline and excellence to our service delivery model. I've personally put this kind of program in place before, and I'm confident it will help us improve client retention and expand our most valued partnerships. And it'll do this by freeing up our global client leaders and their teams to spend less of their time on internal process and more of their time doing high-impact work for our clients. Let me give you three examples of what I think exceptional client engagement looks like. And I'll start with the KitKat heist campaign created by VML and Burson in close partnership with the Nestle team. Fast risk assessment and decision making turned a potential disaster of a lost shipment of KitKats into a global award-winning campaign, dominating the critical Easter sales window, capturing 44% of category conversations on Meta, nearly three times its nearest competitor, and delivering a 600% spike in search interest, generating over 70 billion impressions in social media, equivalent to 224 million of earned media in only 10 days. This campaign was a testament to the talented teams from both Nestle and WPP, who rewrote the traditional crisis management playbook in real time, but also a great example of how our simplified, more agile WPP is working in deep partnership with our clients as they themselves transform for growth. Just two weeks ago, Philippe Navratil in the Nestle earnings call referenced this work specifically as a powerful illustration of the changes already underway in their own organization, including their evolving approach to marketing, and their shift to a performance culture. Secondly, during the recent Unilever earnings call, Fernando Fernandez noted the work that we did with Dove in partnership with Reddit during the launch of their new intensive repair hair mask. Let's take a look at that campaign. Reviews used to be opinions.

Now they're promotions.

But when every product is absolutely fantastic and life-changing, perfection, no one knows what to trust anymore.

Dove has always stood for what's real. So when it came to promoting our intensive repair mask, we chose honesty over hype. First, we went to Reddit, where there's no spin, no polish, and no control. Just brutally honest people with usernames like HairGoblin92. We asked them to review our product with one risky commitment. The first 50 reviews, that's the campaign. No edits.

I love this shit. The smell is too strong.

Holy grail of hair masks. What a disappointment.

My wife likes this.

Very moisturizing and smells hella bad. From Reddit to streets across the U.S., we put it all out there. Then we brought Reddit anonymity onto set.

Is it my review? You want me to read it? This mask said it was hydrating, but just wasn't really doing it for me. It's hydrating and my hair craves it. This cap, I hate it. If there's one thing I don't love about the product, it is the packaging. Wow, where have you been all my life? To me, it smells like tropical vacation vibe. it kind of smells like expired hotel shampoo it's just being honest at a time when brands fear real honesty we asked for it honestly this isn't a mask i would reach for weekly amplifying even the negative through paid media it would be nicer if it was in a bottle definitely up to my expectations we're gonna go to the garbage if we don't get this reformulated it left my hair looking a little bit greasy i agree with that person on the smell just And just like that, it took off, proving that honesty not only resonates, it sells.

But something else happened. It helped us win over today's newest influencer, AI. Turns out when you stop curating the truth, people start believing it again.

If it wasn't for the good and the bad reviews, I don't think I would have tried it.

What's striking about this campaign is not only its success. I mean, it created a billion in earned impressions, more than doubled sales, and helped Dove become the number one hair mask product in the U.S. during the campaign. But in addition to this, the campaign successfully addressed the challenge of making products discoverable by conversational AI, appearing in 56% of all hair mask chat GPT responses and the top recommendation across major LLMs, while remaining true to Dove's real beauty philosophy. The third example and final example is the Coca-Cola company and the work that we delivered during an incredible FIFA World Cup 2026 campaign. Together we reached 180 markets with the trophy tour alone making 70 stops across 30 markets and engaging around 700,000 fans. digital and social activations generated 60 billion impressions with 9 billion views helping trademark coca-cola become the number one brand by share of voice during the tournament and importantly these efforts contributed to quarterly growth of five percent for coca-cola and eight percent for power aid it's an absolute honor to partner with such an iconic brand and company. In February, I also updated you on our progress on our technology strategy, WPP Open, and our growing partner ecosystem. As the name suggests, WPP Open is open by design. It works with client and partner solutions and doesn't lock clients into a single closed ecosystem. Having spent a decade at the frontier of enterprise transformation, I know how important it is to build a robust partner ecosystem. In a fast-changing world, no single company can go it alone. Our partners keep us and our clients at the cutting edge of innovation. They help us scale our impact faster and open new routes to market. That's why in the first half of 2026, we continued to deepen our strategic technology partnerships with Google, Adobe, Meta, AWS, and Microsoft, giving clients a simpler, more powerful alternative to managing multiple-point solutions by bringing the best of the partner ecosystem together in one integrated platform, WPP Open. With Google, we expanded our partnership by launching a new frontier research initiative with Google DeepMind that embeds advanced AI research directly into WPP Open. Together, we've built a predictive cultural intelligence engine that forecasts emerging trends by giving clients the ability to both anticipate and respond to cultural shifts. These solutions are live in WPP open today across multiple clients, including Duracell, Airbnb, and Lexus, redefining the future of the new marketing flywheel and changing how our teams generate work from data to insights to creative to production to media in ways that just weren't possible before. Our expanded partnership with Adobe brings together their industry-leading AI capabilities, content platforms, and data orchestration with WPP's strategic insights and creative expertise through a new joint client transformation practice. Adobe Firefly Foundry is now integrated into WPP Open and Adobe has invested in HEX, our frontier creative technology studio, to deploy AI talent directly with clients. This is a clear example of how we're expanding our go-to-market channel for enterprise solutions and tailoring new AI solutions to meet the needs of our clients. With Meta, WPP became the first advertising partner to pilot their newest creative intelligence solution, also integrated directly into WPP Open, giving our teams the ability to diagnose, generate, and scale high-performing creative with AI. Unilever is the inaugural client with broader rollout planned in the coming months. That unique access puts our clients at the forefront of culture and insight, turning real data and media performance directly into stronger creative outcomes. With AWS, our enterprise solutions business signed a multi-year strategic collaboration agreement focused on operationalizing agentic AI for enterprise brands and helping clients move from AI experimentation to agentic marketing solutions at scale. And with Microsoft, we're working with MAI, Microsoft's in-house AI research team, to secure early access to their generative media models for integration into WPP Open. We're already an early enterprise partner on MyImage2, Microsoft's newest image generation model, bringing the best of Microsoft technology into WPP Open so that our clients gain new productivity and creative capabilities. Together, these partnerships give our clients early access to cutting-edge capabilities, co-innovation investment, direct lines into partner product teams, open important go-to-market channels, and new routes to market. All of this converges in one place, WPP Open, strengthening our competitive advantage, and most importantly, the value we deliver for clients. And there's much more to come. So moving on to cost savings, as part of the broader Elevate 28 program, we committed to 500 million pounds of gross annualized cost savings across the next three years, of which 100 million will be delivered in 2026. I'm pleased with our progress in the first half of the year, and I remain confident in our ability to hit these targets. That said, I do want to remind you that my priority, my North Star, is to get WPP back to positive organic growth. And our plan is to reinvest the targeted savings in FY2026 into key growth areas, including media and enterprise solutions. Finally, we said in February that our portfolio review was complete and we were moving to action. In the first half, we completed more than 15 non-core asset disposals that will generate over 200 million pounds in sales proceeds in 2026. One great example is Extel, a leading provider of revenue management and trade promotion software that we owned through Kantar Holding. We've agreed a sale of this asset that will generate value for us of more than 100 million. This is just one example, but it's representative of how we're approaching this process more broadly. We've been very vigorous in exploring whether we're the best owners of our assets and also very focused on withdrawing capital from passive or non-core positions. We continue to make progress on asset disposals and will provide updates as appropriate. Proceeds will be used to improve financial flexibility, strengthen our balance sheet, and create further capacity to invest in growth. So those are the leading indicators, and they confirm that we're executing against the plan that we set out. But I want to take a couple minutes just to connect the what to the why, because the momentum that we're seeing isn't just about better execution. It's about being positioned in the right markets with the right proposition at the right time. You know, September 1st will be my one-year anniversary in role, And this is a great opportunity for me to just step back and briefly share some personal reflections on how I see our industry and our company, because the conviction I have in our strategy has only deepened over the last few months. Firstly, we operate in an attractive market. You know, when I set out Elevate 28 last February, I said that I believe we're living in the golden age of marketing. I believe more strongly in that today than I did even a few months ago. We're forecasting that global ad spend will grow by 8.9% in 2026. That's up from our previous forecast of 7.1%. And as a share of GDP, advertising revenue is now at its highest level in almost 30 years. A clear sign of the important role that media plays, not just in shaping how consumers discover, evaluate and engage with brands, but in helping businesses generate demand, differentiate, and drive long-term value. Media is everywhere, and increasingly, its influence is extending into adjacent and fast-growing markets from social influence to commerce to high-velocity production and enterprise solutions. Secondly, we operate in an increasingly complex market. It's a really tough time to be a chief marketing officer. The fragmentation and constant change our clients face is pretty relentless across media channels, platforms, data environments, the AI and tech landscape and commerce touch points. And all that complexity is driving brands to consolidate around fewer, more integrated partners who can simplify things for them and help them grow. Those dynamics play directly into the strengths of the new WPP. thirdly I think AI is fundamentally changing how we deliver growth for our clients look for the past 20 years the marketing industry has built its advantage around identity-based consumer targeting but marketing in the era of AI has changed and the industry has been slow to adapt identity remains a useful starting point but identity alone cannot tell us how someone's preferences, beliefs or behaviors changing in real time or what they might do next. Marketing has entered the era of intelligence and that has significant implications for brands. To engage consumers today in a meaningful way brands need to access a diverse range of live data signals on what people are watching, what are they buying, who are they following, what are they listening to, how are their interests changing in real time. Through WPP Open, clients can connect their own data with signals across WPP and our more than 350 data partners, giving them access to 5 billion consumers in more than 100 markets, drawing on trillions of real-time signals. We use AI to turn those signals into marketing intelligence that's unique to every brand, enabling them to anticipate consumer behavior, identify untapped growth audiences, and deliver higher ROI and engagement than traditional identity-based targeting. And here's the important part. We deliver these results without ever moving underlying client data out of the client's environment. Traditional identity-based systems require brands to move their data into a centralized third-party system. In doing so, brands risk giving up control of one of their most important and unique competitive advantages, their data and data insights. Our approach at WPP is fundamentally different. Infosum, which we acquired in 2025, is what makes this possible. InfoSum is now embedded into WPP Open, enabling brands and partners to collaborate, connect real-time signals, and generate marketing intelligence without sharing, moving, or co-mingling their underlying customer data. This is more than just a technology choice. It reflects a fundamentally different belief about where competitive advantage should sit. We believe it should sit with our clients. And that brings me to my fourth and final reflection, which is the importance of trust. Not just consumer trust in brands, which, according to our research, is at an all-time low, but brand trust in agencies as well. At CanLion last month, I shared our WPP trust principles publicly for the first time. These are five foundational commitments to our clients that define how we operate in the era of AI and give us a real point of differentiation in the market. Here are the five trust principles, which we unpack in detail on our website at WPP.com. But our core commitment and belief is that our clients own and control their data and intelligence. Full stop. It is one of the most valuable and distinctive competitive advantage any brand has, and it should remain exclusively theirs. With WPP, underlying client data never moves. It stays exactly where it is in the client's environment and under the client's control. We believe this is a winning strategy. It now features in every client pitch, and it's one of the key reasons why we have the momentum we do. In an environment where AI is rapidly transforming our industry and trust is scarce, I believe our commitment to client data ownership and control will become increasingly important. Everything we do is in service of one objective, to be the trusted growth partner to the world's leading brands. Our momentum over the last nine months gives me confidence that we are firmly on the right path. The organizational structure and operating model are in place. Our integrated client proposition is working. The cultural shift towards accountability, client obsession and a hunger to win together as one team is real. We're delivering the stabilization phase of our plan and the leading indicators demonstrate the progress we're making. WPP will be a fundamentally stronger, simpler and more competitive company. Growth is our North Star, and we're well on our way. So looking ahead at what you can expect from us in the coming months, well, operationally, you will see us laser-focused on delivering for our clients, continuing to embed the changes we've made in service of driving their growth. Strategically, you'll see us continuing to invest to make our return to growth sustainable as we move to the build phase of our plan in 2027. And finally, you'll see the improving trajectory in organic top-line growth, margin expansion, and improved financial leverage that we anticipate in 2027. While we'll give you a comprehensive update on progress at the full-year results early in 2027, I'm really eager for you to see the execution of this strategy along the way in real time. We've already hosted deep dive sessions for you into WPP Media and Creative, and we'll host further webinars specifically exploring next-gen production and enterprise solutions during the second half of 2026. So with that, I'm delighted to hand over to Joanne, and then we'll both come back to answer your questions. Joanne, over to you.

Thank you, Cindy, and good morning, everyone. So let me start by taking you through the main headlines from our first half results which you can see on slide 20. Like-for-like revenue less pass-through costs fell 2.8% in the quarter which leaves the first half organic decline at 4.7%. This is consistent with our guidance of a decline in the mid to high single digits in the first half and reflects an improved sequential performance in particular at WPP media as well as the benefit of easing comparables. You will recall last year we identified some one-off factors in Q2 that impacted performance. Adjusting for this, the underlying Q2 like-for-like decline was 3.8% and improvement quarter-on-quarter. Turning to headline operating profit, this came in at £398 million, which is consistent with a margin of 8.4% and up 20 basis points year-in-year, benefiting from cost-saving actions and lower headline severance costs. Our headline diluted EPS is 15.1 pence, down on the 20 pence reported last year, mainly due to the normalisation of our headline effective tax rate year-in-year and reflecting lower year-in-year profit. Turning to cash flow, adjusted operating cash flow pre-working capital came in at £309 million, which includes £83 million of non-headline cash restructuring costs. The H1 performance brings total adjusted free cash flow, including working capital moves over the last 12 months to £730m, which alongside a one-off benefit from IFRS 9 amendments resulted in a reduction in adjusted net debt of £326m year-in-year to £2.9m. Our average adjusted net debt meanwhile is down £100m year-to-date and £79m year-in-year. Moving on to slide 21 and performance across our business. As a reminder we now only report on the basis of one segment, global integrated agencies, which is consistent with our strategic plan for WPP to operate as a single, unified business. Global integrated agencies saw a like-for-like decline of 2.8% in the second quarter, a sequential improvement from a 6.7% decline in the first quarter. FX contributed to a 0.6% tailwind, with a marginal M&A headwind of 0.1% leaving a reported decline of 2.3% for the quarter. If we look at the trends by business we saw a sequential improvement in our largest business units in the second quarter. The most significant move is within WPP media which declined 2.8% in Q2 versus a decline of 8.3% in the first quarter. If we look at the drivers at this easing comps were definitely a factor, and adjusting for the one-off factors I mentioned, underlying WPP media performance was a decline of around 5%, an improvement quarter-on-quarter. As anticipated, the impact of net new business losses was less significant in Q2 than in Q1, and we saw a lower drag from existing clients. Turning to WPP Creative, although we saw a top-line decline of 4.9%, we delivered a sequential quarter-on-quarter improvement, reflecting the growing positive impact of new business as well as again the impact of an improving trend with existing clients the various disciplines captured within WPP creative brand and design continue to see growth in the low to mid single digits while PR is now declining in the very low single digits with an improving sequential trend and growth in their key region North America as discussed in February we will give more precise detail on net sales performance for enterprise solutions from the 1st of January 2027. And finally WPP production continues to see positive growth with an improving quarterly trajectory supported by new business wins. Turning now to performance by region North America declined by 4.3 percent in the second quarter following a decline of 7.8 percent in Q1 supported by a mild improvement in the impact from net client losses and an improving trend in client spend from existing clients which is encouraging. In EMEA too we saw an improving trend with the first half down 4.3% and the second quarter down 3% with particularly strong trends in southern Europe. The latter benefited from the impact of one-offs we mentioned last year. We note a mild improvement in underlying performance quarter on quarter, excluding these and despite the impact of ongoing uncertainty in the Middle East, which was down around 10% in the first half. As part of our new regional disclosure, we are now giving separate disclosure on Latin America and Asia Pacific. In both cases, we saw an improvement in underlying trends. In Latin America, like for like in the half declined 1.2%, but was up 0.9% in the second quarter, driven by strong growth in Argentina and Uruguay, albeit with the former tracking inflation. In Asia Pacific, like for like was down 3.8% in the first half, but grew 0.3% in the second quarter. Within this, I'm pleased to report a return to growth in China, up 2.6% in the first half and up double digits in the quarter, which reflects some timely benefits. But nevertheless, we are seeing improvement trends in new business and a stabilisation of spend across local clients. We are encouraged by the performance in China and expect the business to continue to stabilise in the second half, albeit not at the level of like-for-like in Q2. By contrast, India saw a moderating trend into the second quarter, largely driven by the timing of events. We expect a resumption of growth in the second half. And turning finally to trends by client sector, we continue to see negative trends in CPG, which was down 6% in the second quarter, largely due to the impact of assignment losses, but seeing a sequential improvement quarter on quarter helped by easing comparisons. Performance across technology clients is largely unchanged from the first quarter, with the second quarter down 8.9% after a Q1 decline of 9.6%, again impacted by the effect of assignment losses. As per our commentary at the Q1 results, we continue to see a high degree of polarisation across these categories. By contrast, we've seen a material sequential improvement within both healthcare and auto, which have both returned to growth during the second quarter. While we have seen an improvement in the longer tail of local clients, we are also pleased to note the improvement in the performance of our top 25 clients. This group still saw a decline of 6.3% in the first half, but with the second quarter declining at 3.2%. As a reminder, this includes the impact of assignment losses, and excluding this impact, our top 25 clients returned to growth in the quarter. On slide 22, we show the evolution of our headline operating profit, and slide 23 bridges our headline operating margin from 8.2% in the first half of 2025 to 8.4% in 2026, a 0.2 percentage point uplift on both a reported and like-for-like basis. If I unpack the moving parts through the first half, starting with the impact of operational gearing and margin during the period, while our net sales is down £281 million, our overall staff costs, excluding headline severance and incentives is down £245 million, reflecting the benefit of cost actions taken in the second half of 2025 and early in 2026. Adding in savings across other operating costs, such as property and personal costs, this added around 90 basis points to margin. Lower headline severance and other associated costs added another percentage point. And completing the bridge to the full move and headline operating profit margin in the first half investment in our growth drivers including incentives went up by 170 basis points leaving h1 headline operating margin at 8.4 percent. I want to say at this stage though that the movements in the first half are not necessarily reflective of expected margin performance for the full year. Starting with severance the positive move in the chart is representative of a 51 million pounds reduction in headline severance and other associated costs year in year and will not have as significant an impact in the second half. On cost savings, the Elevate 28 savings will be skewed to the second half, reaching a run rate of £250 million by year-end and achieving £100 million of savings in year. We note though that we start to anniversary the action taken last year at WPP Media in the second half, so these savings are against a tougher comparable. Turning to incentives and investment in growth areas, we continue to expect a significant uplift in the second half of the year. Reflecting this, while we are pleased with the first half margin performance, as expected and in line with our planning, we nevertheless expect second half margins to be down by as much as 200 basis points year in year, as continued investment in growth drivers and the rebuild of incentives ramps up. Slide 24 shows our headline P&L. Overall reported revenue less pass-through costs was £4.7 billion, a decrease of 5.6% period on period. Moving down the P&L and a reminder that income from associates excludes any contribution from Cantor in accordance with IAS 28 due to nil corring value on our balance sheet. Net finance costs of £135 million was up slightly year in year, reflecting the additional corring cost of debt ahead of maturities later this year and early next. Our effective tax rate at 33.5% is up year in year, but note that the rate in 2025 was positively impacted by the benefit of credits from the successful resolution of a tax matter. We continue to expect the full year effective tax rate to be in the range of 33 to 34%. Non-controlling interests of £18 million were down compared to the prior period, impacted by M&A and lower profit. And as a result of those factors, headline diluted EPS of 15.1 pence is down 24.5%. Turning to the dividend, we indicated in February that we anticipated a full year dividend of 15 pence and consistent with this the board has declared an interim dividend of seven and a half pence which is flat year in year. Slide 25 looks at our adjusted operating cash flow and bridges the year in year movement in adjusted net debt to June 2026. Our 12-month adjusted operating cash flow before working capital to June 2026 was £1.1 billion. In addition to this we saw an incremental benefit from working capital which includes 169 million pounds one-off impact from the IFRS 9 amendments. Factoring in 66 million pounds from the net impact of dividends from associates and to minorities and including M&A earnouts as well as 527 million pounds of net interest and tax adjusted free cash flow for the last 12 months stands at 738 million pounds. Net M&A and disposals was a 43 million pounds outflow consisting of direct disposal proceeds of 80 million pounds but against that we spent 123 million pounds as we continue to invest in our commerce capabilities. To round off the picture cash dividends paid in the 12-month period were down significantly on the previous year given the decision to reduce the dividend in July 2025. Adding in the impact of buybacks and other items which amounted to an outflow of 369 million pounds overall adjusted net debt was down £326 million year in year. Looking specifically at the first half, adjusted operating cash pre-working capital was £309 million, while free cash flow was a £725 million outflow, consistent with the seasonal build-up in working capital typically seen in the first half. I'm moving now to slide 26, which shows how net debt has trended since June 2025. As already mentioned, adjusted net debt at the end of June stood at £2.9 billion, down year-in-year but up from year-end, reflecting our typical cash cycle. This also reflects the benefit from the IFRS 9 amendments. Average adjusted net debt better captures the normal pattern of working capital moves across the year, and this is slightly down through the first half and down year-in-year at £3.3 billion. pounds. Our average adjusted net debt to headline EBITDA ratio at 30th of June is broadly unchanged since December 2025, despite the downward pressure on headline EBITDA. I want to re-emphasise that creating firm financial foundations is a core tenet of the Elevate 28 plan, and at the heart of this is a commitment to maintaining an investment-grade balance sheet. As discussed in February, we anticipate our leverage metrics to remain elevated in 2026 before starting to come down in 2027 and beyond. In this context, our balance sheet remains robust. The weighted average maturity of our £5.1 billion of bond debt is 5.7 years, and this has an average coupon rate of 3.7%. Meanwhile, our total available liquidity across the group stood at £4.1 billion at the 30th of June 2026, including a $2.5 billion committed RCF, which matures in February 2031 and remains undrawn. Neither our bond debt nor our RCF have any financial covenants and our credit remains investment grade. And finally, turning to slide 27, which shows our guidance for the full year. And starting with the outlook for like-for-like revenue-less pass-through costs, in February we indicated that at that point we anticipated the impact of gross client losses to be in the range of 500 to 600 basis points, while we expected the impact of gross wins to be more positive than last year, with a phasing of wins and losses consistent with an improving trajectory through the year. Based on our new business performance in the second quarter, while we would estimate the impact of incremental losses to be at the top end of the 500 to 600 basis point range, the impact of wins means that as we progress through the second half, we expect the year-in-year drag from net new business to continue to lessen, and as such we remain confident in an improving trajectory. A key unknown is the trend with existing clients, And while we are encouraged by the Q2 performance, we note the ongoing uncertainty in the Middle East, as well as the polarisation of spend patterns, both between and within sectors. Reflecting this, we take a balanced view of the outlook and having seen each one like for like decline at 4.7 percent, we expect like for like revenue less pass through costs to decline low to mid single digits in the second half. We continue to expect a return to growth during 2027. Turning to headline operating margin, while we are encouraged by the H1 margin performance, as we discussed, the first half was helped by the lower headline severance and cost savings. We anticipate investment in our growth drivers, as well as the rebuild of incentives to step up significantly in the second half. Reflecting this, we still expect headline operating margin to be in the range of 12 to 13 percent, consistent with the second half margin decreasing by as much as 200 basis points. As per our original Elevate 28 commentary, we continue to anticipate 2026 to be the low point in terms of profitability and expect margins to rebuild from 2027. Looking beyond the net sales and margin guidance, our expectation for cash flow is unchanged, with adjusted operating cash flow pre-working capital in the range of £800 to £900 million. As a reminder, this includes the anticipated restructuring costs associated with the Elevate 28 programme and historical restructuring programmes. Excluding these, we would anticipate adjusted operating cash flow before working capital of £1 billion to £1.1 billion. Looking further down the cash flow, as you know, we don't guide on working capital, given the scope for this to show volatility around year end. However, given progress with asset disposals to date, we expect the overall impact of disposal-related activity, some of which will come via direct disposal proceeds and some via associate dividends, to contribute at least £200 million to our cash flow. We continue to make progress with our asset disposal programme and are working on a number of future potential asset disposals and will provide updates as appropriate. finally we continue to expect the improvement in average adjusted net debt to be sustained across the balance of the year so that wraps up the formal part of our presentation and both Cindy and I will now be delighted to take your questions we'll now begin the Q&A session in terms of housekeeping if you could please state your name and your organization that would be very much appreciated please note for those joining by the webcast there's the opportunity You can type in questions, and I will run through these at the end of the call.

But in the meanwhile, operator Desmond, can you open the lines for questions, please?

If you'd like to ask questions, please press star followed by one and one on your telephone keypad. To cancel your request, you can press star one and one again. One moment for our first question. Your first question comes from the line of Ciaran Donnelly from Citi. Your line is open. Please go ahead.

Thank you. Yeah, it's Ciaran Donnelly from Citi. Two for me. One, just on quantifying the net new business contribution for 2027. Could you give us that number of basis points? And if you don't want to give us the exact number, can you just talk about how that contribution has evolved since the Q1 update, given the moving part in terms of client losses and client wins? And then two, just in terms of the pipeline of activity heading into H2, there's clearly a lot of unknowns, but just could you give us a sense of the balance of pitches versus defense and just in terms of activity overall?

Good morning, Kieran. Thanks for the questions. Let me take them. I think you mean that new business in 2026, right, not 2027, but let me take you through the numbers on that one. So, in terms of net new business, it's really our growth wins, less our growth losses. So, let me unpick that for you. And before I do, I'll just say that, you know, very encouraged by the new business momentum that we saw continue in Q2. Our growth losses for the full year are at the top end of the range that we shared at the start of the year. So, around 600 basis points. And we'll see those growth losses fairly steadily through the year, but with a slight easing in the second half of the year. On the gross wins, we said at the start of the year that they were more than for the full year 2025. And with the new business performance in the Q2, we're not comfortably ahead of gross wins in 2025 for this year, which is very encouraging. Now, I do expect net new business to be a drag for the full year, and I expect it to be a drag in every quarter of this year. However, with those new business wins, I do expect that drag to ease as we go through each quarter. And indeed, we saw an easing of that from Q1 into Q2. So hopefully that gives you some color on what we're seeing and obviously a big area of focus for us. In terms of the pipeline, the pipeline is, I would describe it as very healthy. Last year, we talked about the lower volume of new business than we typically see. We did expect to see somewhat of a catch up in 2026 and we're seeing that. so that the pipeline is higher than last year, and there are some defensive and offensive opportunities within that. What I would say is it's much more nuanced than what we've seen in the past. So with many of the pitches that we're in, there is some opportunity for winning more revenue and net sales, and there's some revenue net sales that we are defending in those pitches. So very balanced, you know, between defensive and offensive. And as you heard from Cindy, You know, very, very focused on continuing that new business momentum, but also focused on our kind of retention as well.

I was wondering just in terms of 2027, whether we have a picture now, obviously, I get it. Things can change between now and 2027, but just, you know, based on what you can see today.

Look, I think it's just a little bit too early to start talking about, you know, net new business impacts in 2027. I talked about the pipeline, looking to continue to hold on to the momentum that we've seen in the last three quarters and on retention to minimize the loss of it. Yeah, I think it's just a little bit too early, Kieran, to comment on 27.

All right. Thanks, Malik. Thank you for the questions. Please hold for our next question. Next question will come from the line of Adam Boleyn from Goldman Sachs. Your line is open. Please go ahead.

Yeah, hi, good morning. A couple of questions as well. You talked a little bit about improving momentum in terms of existing clients having fewer cuts in their spending in Q2 versus Q1. Can you just give us a little bit more color on what sectors you saw that in and what you think was driving that additional investment in marketing than we've seen in previous quarters? Because that seems to be a quite important change in the trend that we've seen previously. Secondly, you talked about China, which had this very dramatic improvement in growth in Q2 versus Q1, and you mentioned some timing effects. Can you just give us a little bit more detail about what's happening in China? That would be very helpful. And then thirdly, I've noticed that WPP Media is now like 46%, 47% of your revenue, where it used to be 40%, 41% as you restructured the business.

What has gone into WPP Media that wasn't there before? okay um let me take all of those um adam just in terms of the improving momentum in existing time to characterize it correctly um you know we've had a challenging time last year in particular we saw significant cuts to spend around about this time and it's very encouraging that that is now stabilizing um and you know we're seeing a lower drag from those we talked about the performance of the top 25 clients so significant improvement where they were down 9.4 percent in the first quarter and down 3.4% in the second quarter. Obviously, there was some comp impact. But specifically to your question on sectors, in Q2, we saw actually growth in the auto and healthcare sector, so those sectors doing very well for us. And across CPG and tech, we saw those sectors really impacted by the client losses that we've had across CPG and tech. And in tech as well, a little bit of reduced budgets, more focused on our hardware tech clients. But encourage our existing clients, you know, that stabilization and continue to focus on that. In terms of China, you know, China has been a challenging market for us for some time where we've seen double digit declines. We did talk in the Q1 that we expected to see an improving trajectory. And indeed, we did in the Q2, which was up double digits. There are some timing factors within that, and I wouldn't expect that level of light for light to continue in the second half, but I would expect China's performance to continue to stabilize. And just a little bit more color in that, you know, we have seen important retentions, Huawei and Uber in that market, but also wins. We talked about Honor China, and really we're seeing a good stabilization in that market, particularly in our media business. And even in creative, we were down single digits, albeit high single digits, which is an improvement from the trajectory that we have been on. We launched open in China in May, so a lot of activity in that market, and it remains an important market for us and our clients, and a little bit more balanced between global and local clients. In terms of media, yes, the share of net sales from media has gone up from 41% to 46%. So some of the agencies that used to sit within spec agencies, we've moved under media as part of our new segmental reporting. The most significant agencies are CMI and TMP which are much more appropriately sat under our media business. So that's really driven that change.

Thank you very much. Please hold for our next questions. The next question comes from the line of Adrian Ceyson-Hiller from Bank of America. Please go ahead.

Good morning everyone. and congratulations on the progress of your turnaround. Cindy, I think in an interview this morning, you mentioned that you expect some deflationary impact on pricing from AI. Could you quantify this for us? And then maybe for Joanne, just conceptually high level, like why would the investments and the restructuring costs around Elevate 28 would be second half loaded? I think you spent something like 90 million pounds out of the 250 restructuring costs. For example, you've talked about the margins going down quite significantly in the second I'm just wondering why on those costs, perhaps H1 loaded, why would they be H2 loaded?

Yeah, should I take the first question? Thanks, Adrian. I think it would be hazardous for me to try to quantify the AI, the deflationary impact What I said was that I think AI obviously presents both risks and opportunities. And like every technology platform shift in history, I think we are going to see some short-term deflationary impact on pricing. As AI tooling drives productivity gains and reduces our cost to serve, our clients are going to expect us to pass those gains on to them. But as we help our clients, you know, optimize their marketing investments overall, we can also help them reinvest those savings into innovation and transformation. And that represents an expansive opportunity to grow our footprint and to capture more addressable client spend through service integration and cross-sell. And I think with our new structure and operating model, we're very well positioned to capture that. So on balance, what I said was my view is unequivocally that AI represents a growth opportunity for us to really innovate our proposition and reimagine growth for our clients.

Joanne, you want to take the second? Yeah, thanks for the question, Adrian. And I'm going to answer it a little bit more broadly, but I will cover investments and restructuring costs. So in terms of the H1, H2 margin, just a reminder that we generate a third of our profit in H1 and two-thirds in the second half of the year. So it's much more skewed to the second half. In the first half of the year, as I shared in my pre-prepared remarks, we had some benefits from the structural cost actions that we took in media in H2 last year. so obviously we get the benefit of those in H1, but those won't carry through in H2. And also related to that, we had severance costs last year, which we took through headline profit, and that drove a one percentage point benefit and margin in the first half of this year. In terms of, as we go into the second half, we obviously wanted those tailwinds, but we will see the Elevate 28 costs in year, the 100 million that are referred to in freedoms, we are on track to deliver those, and those savings will be largely skewed to the second half of the year. Like in the other mergers, which we have very successfully executed, we've taken our time in the first half to make sure that we have the right operating model design in place, market leads, regional leads are all appointed, and we are taking those actions now, and we'll start to see really those restructuring costs ramp up related to those actions, and also the savings coming through in the second half. In terms of investments, so really, I think of investments in two buckets. First of all, is incentives. We did start to rebuild our incentives in the first half, but again, they're very much skewed to the second half. I'd expect those to continue to rebuild in the second half. And in other investments, Cindy and I have talked about our key priority is to get back to growth, encouraged by the improving trajectory that we've seen. And we will continue to invest in the business, particularly in the areas of commerce, enterprise solutions, media, and data to ensure that we are going to be able to drive that sustained growth. And the guidance for the second half and holding the full year margin at 12 to 13% really gives us that flexibility to make sure that we are continuing that investment in the second half. So hopefully that helps.

It does. And if I can just sneak in one more, perhaps for both of you. I think, Joanne, you talked about the fact that your business would be less of a drag into the second half versus H1. You talked about the fact that top 25 had return to growth, Q2 versus Q1. I think the comparison base is a bit easier. So just high level, what are we missing to get your look to mid-single digit decline that perhaps sounds on the conservative side maybe?

I think on that, Adrian, it's important to note that we talked about the one-offs, which we shared this time last year. And if you strip those out, the Q2 like for like was a decline of 3.8%. So that's the starting point as we go into the second half. We had an easier comp in Q2, around 3%. The comp in Q3 is similar, so we don't have that comp tailwind, albeit in Q4 we get a 1% easier comp. And then, as you noted, the net new business will ease. And really that leaves our clients' existing spend. You know, the macro environment, the geopolitical environment remains very uncertain. We're still continuing to see a high degree of polarization. within our clients and across sectors in terms of that spend. And so we've reflected that in our guidance at either end of the range and we wanted to give a balance guidance which really does reflect all of those drivers and considerations.

Thank you.

Thank you. Thank you for the questions. Our next questions come from the line of Jerome Bodin from Odell BHF. Your line is open. Please go ahead.

Yes, good morning also. It's Jérôme Baudin from OWHS. I have a few questions. So the first one would be on the disposal, so the 200 million at least for 2026. So a few questions. Is it the cashing impact or just the announcement? Is it net of tax? And should we expect more in 2027? And just to understand if the review is now fully finished, and maybe just to conclude on that, is there an asset that you have finally decided to keep that was under review? That's my first question. The second one is just to come back on what you said on incentive. The charge increased quite a lot in H1, so I understand that H2 will still be up. But just I know it's difficult because it's linked to budget, but what should we expect roughly in terms of incentives for this year? Should it be flat versus 2025 up or maybe between 2024 and 2025? That's my second question. And lastly, on just a more general question to get an update on the enterprise solution agenda, And my understanding is that some capabilities are still spread across the other agencies. So my question is, how much of the business has now moved under one leadership and one commercial pipeline? And can you just update on the final organization that you're targeting for that business in terms of independence versus media and creative? Thank you.

Thanks, John. Let me take the first two, and Cindy can pick up the question, Enterprise Solutions. So just on disposals, so we had $64 million in the first half cash flow related to disposals, and we expect for the full year that to increase to at least £200 million of cash, and that is net of tax. Maybe I'll just give a little bit more colour on what that is. We're really at two buckets, I think, if you want to think about our disposals. We talked in February about the portfolio review that we did as part of Elevate28, and that was where we identified assets in the group, which they're great assets, but we felt that they were of more value to WGP outside of the group than inside, and we have initiated processes on those assets earlier in the year, and those processes are ongoing. So no update on those today, but we will, of course, update the market as appropriate. In terms of the 200 million, this really relates to the long tail of smaller agencies and associates and investments that we have across the group. And as we got very focused on cash, We have been looking at rationalizing that long tail, simplifying the business and raising cash proceeds. And I'm really pleased with the 200 million pounds that we will generate this year. You know, there's very small level of income associated with those asset sales. And, you know, part of that is the X-Tel business that was related historically to Cantar. And it will we will carry on with that rationalization. So I would expect some more in 2027. And, you know, in terms of the review itself, you asked whether or not we've decided to retain any assets. You know, as part of that portfolio review, we did look at the assets, and there were many that we said these are important, and we can build and carry on investing in those areas, commerce being a particular area, but others that we identified as potential CO opportunities, which were getting incentives. Look, last year, because of our performance, our incentives were at an unusually low level. And so, in 26, as part of our planning assumptions, we are assuming that we will rebuild our incentive pot, and we've done some of that in each one, and we'll carry on with that rebuild in the second half. I think, certainly, they will be higher than they were in 2025, is our current expectation, and probably closer to levels that you saw in 2024, if that's helpful.

Why don't I come in, Jerome, on enterprise solutions? I mean, this is a great market for us with a 7% CAGR, so it's an attractive market for us to be in. We already have $1.8 billion of revenue in enterprise solutions with around 10,000 specialists. So as you suggested, we're consolidating these assets into one business and really scaling it across the group. And I think what's differentiated about this business is that we're not sort of selling bolt-on services from a separate company. It really was built from within VML originally and designed to be deeply integrated with creative production and media. And we are predominantly focused on marketing operations and the CMO, where we have already, you know, quite strong historical relationships. So WBB Enterprise Solutions went live on the 1st of July. It already has a number of active client engagements in a healthy pipeline in areas like CRM, customer experience, commerce, content supply chain, and AI marketing transformation. You know, these are probably the fastest growing parts of the enterprise solution landscape. So I'm really excited about the future of this business under Jeff Gaheb's leadership. And I believe there's an investor webinar coming up soon, and I would encourage you to participate and learn more.

Thank you very much.

Questions? Please hold for our next question. The next question comes from the line of Steve Lietti from Deutsche Numis. Your line is now open. Please go ahead.

Yeah, morning. I've got three. One, just going back to the kind of run rate on new business, sorry to come back to it, but just can you give us any kind of feel in terms of the first half, what the kind of relative effects were between the gross losses and the wins in the first half and just give us a bit more help into the second half there. I'm just finding it, obviously, you've given us the losses, but I'm just finding it quite difficult, you know, on the new stuff. That's the first question. Second question, I thought you might like to give us a rough estimate if you took enterprise solutions on a kind of pro-forma basis, what the like-for-like growth would be. And then the third is, I know on the exits, you said it's quite small. Just any action that's in your consolidated numbers, because I'm presuming the Cantar business, Extel, is not in your numbers at all perspective.

Let me start at the bottom and work my way up, Steve. So in terms of the exits, you're right. Extel isn't in our numbers, nor is it in Cantar's numbers. And that's a significant contribution towards that 200 million. The others are really associates and investments. So it's a very, very immaterial number in terms of our overall income and really no impact on revenue. On enterprise solutions, we've said that we will report our like-for-like for enterprise solutions from the 1st of Jan, 2027. This year is really all about building that, building out the three field channels that we've talked about on enterprise solutions. I think it's fair to assume that the like-for-like that we're seeing in ES is approximately itself what we're seeing more broadly across WTP Creative. And in terms of the run rates, look, I don't really want to get drawn into giving you net new business by quarters and by halves, but to help you a little bit. In the past, I think we've always talked about net new business having a plus or minus 150 basis points impact. Obviously, 25 was a difficult year for us in terms of client losses and the 600 drag this year. And that drag is pretty steady, as I said, through the year, slightly lower in the second half. So we had a significant drag from that in the first half. The new business wins really started from 2-4, and they will obviously take a couple of quarters to ramp up. So as we look through the year, the new business contribution is much more significant in the second half than it is in the first half. And therefore, in the first half, we did see a bigger drag than that 150 basis points that we would have seen historically. but we are expecting that to ease as we go through the second half. And indeed we saw that starting to ease in the Q2. Hopefully that helps.

Yeah, thanks. For the questions, one moment for our next question. Next question comes from the wire of Julian Rocks from Barclays. Your line is open. Please go ahead.

Yes, good morning. Thank you for taking the question. The first one is based on your second half guidance of low-to-missable-digit decline, organic for the full year should be broadly around minus 4. And you said losses minus 600 basis points and the wins comfortably more than last year, 250. So let's call that 300, which would indicate that your existing clients are declining 1% this year. Last year, you did minus 5.4, which was broadly minus 4 existing clients and minus 1.5 account losses, 400 losses, 250 win. why are existing clients three points better outside of net new business? I might, you know, it might not be the exact math and it might not be three points, but it's clearly much better. So why? That's my first question. The second one is on China, up 16%. You said timing benefits. What do you mean exactly? And what China would have grown without those timing benefits? And if you cannot give us that, when you say stabilization in the second half, does that mean flat or would it be still negative and then on portfolio you said you've decided what you need to sell and it was ongoing so if you are successful in in what you want to do share with you much bigger benefit than 200 million sometimes in the next 12 months thank you okay thanks Julian I I can always rely on you for the detailed questions.

So just in terms of existing clients, look, if I take you back to this time last year, you know, the tariffs kicked in in April and, you know, we saw a sharp decline in client spend. We didn't lose clients so much, it was a sharp decline in spend in the back end of that Q2 and that continued through the second half. So existing client spend was a real drag for us last year And it's very encouraging to see that that has stabilized. You know, it's still a drag in the first half, but we're very, very focused on, you know, our client delivery, and we see an opportunity to continue to grow with our existing clients. We did say that the spend is quite polarized still within sectors and across different clients, and so seeing a bit less polarization, a little bit more growth will be helpful. But it's a big focus for us. So I think it's really that stabilization and really last year, those material cuts that we saw really from June last year that now is not happening to the same extent. Maybe on some of the contracts in our media business, I don't really want to get too drawn into it, but I did say that in the second half, I expect China to continue to stabilize, certainly not at the level that we saw in the second quarter, but a continued stabilisation across our media business in particular. So we've been at high double-digit declines for some time. I'm not expecting that in the second half. And for the full year as well, overall, an improvement on China year on year. In terms of the portfolio, I'll just go back to what I said earlier because it's difficult to say much more than that. The portfolio review that we did and the assets where we have processes ongoing on And if we are successful in doing what we want, then we will generate, you know, more cash proceeds from those, and we'll update on those in due course. And then on the long tail, you know, of course, you know, we've got after those with some pace this year, and there will be more opportunity to continue to rationalize that long tail into 2027. So I expect some more cash proceeds from those in 2027, perhaps not to the same extent as in 2026. Thank you. Thanks.

Our next question comes from the line of Enigmas from Bernstein. Your line is open. Please go ahead.

Good morning. My first question is on the Middle East. I think you said you were down 10% in the first half. What is your guidance including for the Middle East for the second half? The second question is on personnel costs. I think if we take your assumptions of low single digit to mid single digit decline in the second half on the top line do we expect personnel costs to at least decline mid single digit if not more and then thirdly probably more conceptual but can you tell us you know for the accounts that you've won in the first half respectively lost what was called out as you'd be doing very well or very badly thank you okay Yeah, what I think first thing, Cindy can take that last one and give some color on winning.

So in the Middle East, yeah, it was down 10% in the first half. You know, it was down high single digits in 2-2, so slightly better. And I think it's very difficult to give guidance in the Middle East just given the tragic events that are unfolding over there. And it's incredibly volatile as well. So in our planning assumptions, we've been very balanced in assuming, you know, what happens in that market. You know, we are seeing some markets, you know, getting back to growth. Others, you know, still declining to the same extent as they've done in Q1. So, you know, our top priority in that region is our people and making sure that they are safe. In terms of personal costs, this just really reflects our incredible discipline around discretionary spend and really focusing the investment that we are making in the areas that will drive the highest return on investment for us. So I'm not going to say anything more than we'll continue to stay focused on those in the balance of the year.

Yeah, thanks for your question. Look, I'm with clients every single day and frequently leading client pitches as well. And in terms of what's driving our new business momentum, I would say our clients are responding very well to our integration and simplification. And that's good because all the changes we made were in direct response to client feedback. And now that we've made the changes, clients are responding positively. And I think what's behind that is that we're showing up as one WPP instead of multiple different agencies, so we can really put the right talent in front of the right clients at the right time without all of the friction and constraints of our historical structure. So that's really unlocking a sort of talent fluidity and crosstalk opportunities that we're seeing show up in a number of our wins. I also think, as I said in my prepared remarks, that our WPP open platform and our narrative around data is very compelling. And I think clients are starting to understand that data ownership and control in the era of AI is one of the most important competitive advantages that they have. And I think our narrative and the way our solution is architected is very differentiated. So those are some of the things that are driving our wins. It's always hard to say what's driving our losses. First of all, I would say we're in a very fiercely competitive market, and defensive pitches are just a feature of this landscape. You know, we're not going to win them all, and frankly, we don't need to win them all. We take every loss as a learning opportunity, and I think that's what growth mindset's all about. It helps us drive a culture of continuous improvement. You know, sometimes it's just a personal preference. Sometimes it's a pre-existing relationship. It's hard to say, but we take the losses every single time. We take them as learning opportunities and we go deep to try to understand and improve for the next time. So hopefully that helps. Thank you.

Thank you for the questions. As a reminder, if you'd like to ask questions on the phone, you may press star 1 for the white one. There are no questions at this time. Please continue. you.

Thank you very much. So that represents the end of the telephone question and answer session. I do have some questions from the webcast. A lot of them have been already addressed, but maybe going through a couple. A question on India. There was a decline in the second quarter. Are you looking for an improvement in the second half?

Yes. I mean, this is really just the timing of a sporting event in India that can drive a lot of volatility and we're expecting yes to get back to growth in the second half.

So the second question on capital allocation for you, Joanne, it's on gross debt. Is reducing gross debt a capital allocation priority? Does that mean we should expect more debt tenders?

So, look, we talked in Elevate 28 about our capital allocation framework and the importance to us and the priority of maintaining an investment-grade balance sheet, which we're very focused on doing. Our leverage is elevated. It was 2.18 times for the 12 months ending June 2026, and we are very focused on bringing down that leverage. I am encouraged by the fact that our adjusted net debt year-in-year was down from 3.3 billion to 2.9 billion, and indeed our average adjusted net debt was also down. So that leverage, that higher leverage has really been driven by the lower level of profits. And so, yes, we are expecting to continue to bring down the debt. But the bigger driver for our leverage reduction will be that, as well as improving our underlying profits.

And one final one is on the comp profile. I think this was covered in the comments, but just to be complete, talked about easy comps from Q2 2025. Can you quantify those and remind us what they are?

So the easier comp in Q2 was just under 3%, so it was about 2.9%. And then as we go into the second half, you know, we won't have that tailwind in Q3. So the comp is similar in Q3 as it is in Q2, but then it eases again in Q4 by about one percentage point.

And so with that, we've reached the end of the Q&A session. I will now pass over to Cindy for some concluding remarks.

Oh, thank you, Tom. That's great. Look, as I approach my one-year anniversary in this role, I am encouraged by our performance in the first half. We're on track, and I continue to be optimistic about WPP's future. I think with the organizational structure and operating model now in place, the focus for us now is on successfully delivering the stabilized phase over the balance of the year, and we look forward to updating you on progress at our Q3 in October and full-year results in February 27th. As a reminder, we'll also host further sessions specifically around our next-gen production model and enterprise solutions business during the second half so that you can get a clearer view of the work underway in those two critical areas. Finally, as we continue this journey, I'd just like to say thank you, first and foremost, to our clients and partners. Thank you for your continued partnership and for trusting in us with your extraordinary brands in a market defined by complexity and rapid change, working alongside you to navigate these shifts and put AI to work and unlock new growth is just an incredible privilege for all of us here at WPP. To our people across the globe, thank you. Transforming a company of our scale is hard work, and it requires a lot of grit and agility and willingness to unlearn and learn and relearn every day, and I'm just so impressed with the resilience of our people, their creativity, passion, and how they've embraced our new purpose and mission and are executing on the plan. It's relentless, but it underpins all of the progress you've heard from us today. And finally, to our shareholders, I'd like to thank you sincerely for your ongoing support, engagement, and belief in our strategy. We remain laser-focused on delivering on our commitments, strengthening our financial foundations, and building the path back to consistent. So with that, thank you again, and I will close the call.