Philip Lader

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Philip Lader

• Chairman

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Sir Martin Sorrell

• CEO, WPP

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Strategic Priorities

• Short term to continue to balance changes in
  revenues against staff costs and headcount
• Medium term to continue the integration of TNS
  within Kantar
• Long term to continue to develop our business in
  the faster-growing geographic areas of Asia
  Pacific, Latin America, Africa and the Middle
  East, and Central and Eastern Europe and in the
  faster-growing functional areas of marketing
  services, particularly direct, internet,
  interactive and consumer insight that is, new
  markets, new media and consumer insight

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Key Priorities, Objectives and Strategy

• Faster growing markets to be one third of total
  group against approximately 27¹ now (31¹
  including 100 of associates)
• Marketing services including new media to be two
  thirds of total group against approximately 61¹
  now
• Quantitative disciplines, basically consumer
  insight, to be one half of total group against
  approximately 38¹ now

¹ Based on full year 2008 reported revenue
adjusted to include a full year of TNS
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Key Priorities, Objectives and Strategy
Faster Growing Markets to be One Third of Total
Group
Faster growing markets including Central
Eastern Europe 27
Today¹
Tomorrow
Today including associates¹
Europe
North America
Central Eastern Europe
Asia Pacific, Latin America, Africa Middle East
¹ Based on full year 2008 reported revenue
adjusted to include TNS for a full year
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Key Priorities, Objectives and Strategy
WPPs Performance¹ Strong in BRIC Markets
Revenue m
800
700
Associates _at_ 100
600
500
400
300
200
100
0
2000
2007
2008
2000
2007
2008
2000
2007
2008
2000
2007
2008
China (including Hong Kong and Taiwan)
Brazil
India
Russia
¹ 2008 adjusted to include a full year of TNS
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Key Priorities, Objectives and Strategy
WPPs Performance¹ in Other Faster Growing Markets
Revenue m
700
600
Associates _at_ 100
500
400
300
200
100
0
2000
2007
2008
2000
2007
2008
2000
2007
2008
2000
2007
2008
Middle East
Eastern Europe
Indonesia
Vietnam
¹ 2008 adjusted to include a full year of TNS
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Key Priorities, Objectives and Strategy
Revenue by Geography
15.4bn
Asia Pacific, LatAm, Africa Middle East
13.4bn
Europe
3.6
1.5
N America
4.8
6.8
7.0bn
6.9bn
1.3
1.3
1.8
2.6
7.1
2.3bn
2.3bn
5.1
0.2
3.9
1.7
2.9
1.3
0.7
0.6
WPP
Omnicom
IPG
Publicis
Havas
Aegis
1 Source WPP - sterling revenues converted _at_
1.85 1 based on the average for 2008, adjusted
to include a full year of TNS. Omnicom, Publicis
and Havas - company presentations for 2008. 2
FX. Havas and Publicis assumes 10.68 based on
the average for 2008. 3 OMC. Assumes non Euro
currency Europe, ie Switzerland, Turkey, Norway,
Denmark, Sweden and Eastern Europe are ca 3 of
revenue and Canada is 1.5 of revenue. 4 IPG.
Assumes Canada is ca 1.5 of revenue. 5Rest of
World. Asia Pacific, Latin America, Middle East
and Africa. 6Aegis. EMEA and Asia 1.7 bn
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Key Priorities, Objectives and Strategy
Marketing Services to be Two Thirds of Total Group
Today¹
Tomorrow
Today including associates¹
Marketing Services
Advertising Media Investment Management
¹ Based on full year 2008 reported revenue
adjusted to include a full year of TNS
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Key Priorities, Objectives and Strategy
Revenue by Discipline
15.4bn
Marketing Services
13.4bn
Advertising
Media
9.5
7.6
7.0bn
6.9bn
2.5
2.9
3.6
2.3bn
2.3bn
4.7
2.6
2.6
0.8
0.9
2.3
1.0
1.8
1.4
1.4
1.1
0.5
WPP
Omnicom
IPG
Publicis
Havas
Aegis
Source 1 WPP sterling revenue converted at
1.851 based on the average for 2008, adjusted
to include a full year of TNS. 2
2008 Company Presentations Aegis consensus
estimate. 3 Media split based on
Deutsche Bank estimates. 4 FX. Havas
and Publicis assumes 10.68 based on the
average for 2008.
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Key Priorities, Objectives and Strategy
Quantitative Disciplines to be One Half of Total
Group
Today¹
Tomorrow
Today including associates¹
Information, Insight Consultancy and Direct,
Internet Interactive
Advertising, Media Investment Management Other
Marketing Services
¹ Based on full year 2008 reported revenue,
adjusted to include a full year of TNS
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Key Priorities, Objectives and Strategy
Quantitative Disciplines to be One Half of Total
Group

• Information, Insight Consultancy to represent
  over 4 billion including TNS
• Creates second largest Information, Insight
  Consultancy group globally
• Creates fourth largest business information group
  globally

Revenue
Revenue
Information, Insight
Information Services
Rank
Rank
Consultancy Groups
2007A (m)
Companies
2007 (m)
1
Thomson Reuters
8,919
1
Nielsen
4,707
2
Kantar/TNS
4,030
2
Nielsen
4,707
3
Bloomberg
4,700
3
IMS
2,193
4
GfK
1,593
4
Kantar/TNS
4,030
5
Ipsos
1,271
5
IMS
2,192
6
Synovate
867
6
Experian
2,020
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IRI
665
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McGraw-Hill
1,802
(1)
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Westat
426
8
Reed Elsevier
1,753
(1)
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Arbitron
338
9
Equifax
1,696
Source The Research Ratings Business Information
100, October 2008 Kantar/TNS based on Company
filings
Source Company filings (1) 2006A from Honomichl
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Key Priorities, Objectives and Strategy
WPP¹ Position in Direct, Internet and Interactive
14 vs 2007
21 vs 2007
¹ 2008 revenues are adjusted to include a full
year of TNS. ² Defined to include total revenue
from Direct, Digital and Interactive Networks
from all sources.
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Key Priorities, Objectives and Strategy
2008 Digital Revenue
Billions
3.9
2.2
1.3
1.0
0.4
0.3
WPP1
Omnicom2
IPG2
Publicis3
Havas3
Aegis3
Source ¹ WPP is wide definition, adjusted to
include a full year of TNS. ² Ad
Age s applied to FY US revenue.
3 Company Disclosure.
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Strategic Objectives
We continue to focus on our key objectives

• Improving operating margins
• Increasing flexibility in the cost base
• Using free cash flow to enhance share owner
  value, and improve return on capital employed
• Developing role of parent company
• Emphasising revenue growth more as margins
  improve
• Improving creative capabilities and reputation of
  all our businesses

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Historic Headline PBIT¹ and Margins
PBIT1 m
PBIT1 margin
Long-term IFRS target 19
2008 including full year of TNS 14.3

• Headline PBIT excludes finance income/ costs,
  taxation, goodwill and intangibles charges,
  investment gains, and share of exceptional gains
  of associates. For 2004 onwards, Headline PBIT
  has been prepared under IFRS. 2003 and prior
  periods are in accordance with previous UK GAAP.

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Financial Model

• Revenue growth in line with the market (0-5)
• Operating margin up 0.5 margin points each year
• PBIT growth of 5-10 per annum
• Use of free cash to repay debt and small to mid
  sized acquisitions up to 100m in 2009 and 2010
• Target EPS growth of 10-15 per annum

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Results for 2008 - Earnings and EPS¹
Earnings (m)
2004 UK GAAP
IFRS
700
55.5p
21
9
600
45.8p
42.0p
17
500
36.0p
32.3p
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11
400
27.9p
29.0p
300
200
100
0
2003
2004
2005
2006
2007
2008
¹ Diluted Headline Earnings and Diluted Headline
EPS
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Increasing flexibility in the cost base

• We continue to focus on a more flexible cost
  structure inthree key areas
• Staff c. 57 of revenue
• Property c. 7 of revenue
• Bought in services c. 21 of revenue
• Increased flexibility in all areas are important
  to combateconomic slowdown

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Increasing flexibility in the cost base
Change in variable costs

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Using Free Cashflow to Enhance Share Owner Value
Acquisitions

• Continue to focus on faster growing geographical
  areas and marketing services, particularly
  direct, internet interactive and
  information,insight consultancy
• During 2008 24 small and mid sized acquisitions
  were completed in executing this strategy
• Acquisitions in advertising are used to address
  specific client or local agency needs
• We continue to find opportunities at earnings
  enhancing multiples, particularly outside the US
• Acquisition of TNS successfully completed in
  October 2008

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Using Free Cashflow to Enhance Share Owner Value

• 2008 second interim dividend raised by 12.6 to
  10.28p per share
• Distributions to share owners

¹ Of which 4.6 relates to share cancellations
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Key Priorities, Objectives and Strategy
Using Free Cashflow to enhance share owner value
distributions to share owners¹
millions
6.6
4.8
4.7
3.6
2.7
2.0
1.6
¹ Sum of share buybacks and dividends paid
divided by average shares in issue for the
relevant period, as a of the average share
price for the relevant period
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Outlook

• The unprecedented financial crisis has triggered
  recession across globe
• Our revised forecasts show mid single-digit
  like-for-like revenue decline, and it will be
  difficult to maintain margins at 2008 level
  (including a full year of TNS)
• 2009 will be a very difficult year, particularly
  in first half and we are taking necessary steps
  to deal with any revenue downturn
• By 2010 we believe impact of massive global
  fiscal and monetary injections and corrections
  should bring a recovery of sorts

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Conclusions

• The Group continues to be well placed by region
  and discipline to benefit from key industry
  trends
• The TNS acquisition represents a major
  competitive advantage for our Information,
  Insight Consultancy or consumer insight
  business and the Group, as well as a source of
  margin improvement
• In the long term the Group will be concentrating
  on positioning its top line in the highest growth
  functional and geographic sectors and improving
  the effectiveness of its cost structure
• The Group will manage cashflow to return average
  net debt/EBITDA ratio to below 2x in the medium
  term
• As the world exits from the financial crisis,
  whenever that is, the Groups strategic focus on
  new geographical markets, new media and the
  application of technology and consumer insight,
  will prove to be even more effective

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WPP Today
WPP
Revenue 7.5bn¹ PBIT 1,118m
Information, Insight Consultancy
Public Relations Public Affairs
Branding Identity, Healthcare
and Specialist Communications
WPP Digital
Media Investment Management
Advertising
Revenue 3.3bn PBIT 581m
Revenue 1.3bn¹ PBIT 148m
Revenue 752m PBIT 125m
Revenue 2.1bn PBIT 264m
Revenue Broader 1.9bn (c 25)
Revenue and PBIT figures are 2008 reported
sterling actuals PBIT is stated before goodwill
and impairment, fixed asset gains and investment
write-downs ¹ Adjusted to include TNS revenue for
full year 2008, WPP revenue is 8.6bn
Information, Insight Consultancy revenue is
2.4bn
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