Advertising agency WPP Scangroup Plc has warned that its earnings for the year ending December 2025 will fall by at least 25%, extending a prolonged period of financial strain marked by client losses, management changes, and repeated restructuring.
The company attributed the expected downturn to weaker client spending, the loss of a major account, reduced interest income, and one‑off restructuring costs exceeding KSh 160 million.
This marks the third consecutive year of profit warnings and the fourth in five years, following similar alerts in 2021, 2023, and 2024.
Financial results have underscored the strain: profit before tax swung to a KSh 426.7 million loss in 2024, reversing from a KSh 378.0 million profit in 2023. Profit after tax followed the same trajectory, dropping from a KSh 130.1 million profit in 2023 to a KSh 506.7 million loss in 2024.
Long‑Term Decline
WPP Scangroup’s earnings remain far below early‑2010s levels, when annual profits topped KSh 900 million. Gross profit has steadily eroded over the past decade, falling from above KSh 5.0 billion in the mid‑2010s to KSh 2.01 billion in 2024.
Reported revenue also dropped sharply last year, though management noted that much of the decline was due to an IFRS 15 accounting change that shifted media buying income to a net, agent‑based presentation.
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Operational Pressures
The group has lost key accounts, most notably Airtel Africa, a long‑standing client that contributed to billings. Client attrition has coincided with senior management turnover and staff restructuring, as the company works to align costs with a smaller fee base. Leadership reshuffles at the board and executive level have sought to stabilise operations, but cost‑cutting has yet to deliver sustained profitability.
Outlook for 2025
Unlike the 2024 revenue drop, which was largely accounting‑driven, the 2025 outlook reflects underlying earnings weakness.
The latest warning places WPP Scangroup among several listed companies facing profit pressure this year, including Williamson Tea, Kapchorua Tea, TPS Serena, Standard Chartered Bank Kenya Plc, Centum Investments Plc, Shri Krishana Overseas Plc, Kenya Airways, and Umeme Limited.
