AGM Statement

WPP Group PLC
30 June 2003


FOR IMMEDIATE RELEASE                                             30 June 2003


                                      WPP

                     ANNUAL GENERAL MEETING TRADING UPDATE
                         FOR FIRST FIVE MONTHS OF 2003


                     CONSTANT CURRENCY REVENUES UP OVER 1%

                       LIKE-FOR-LIKE REVENUES ALMOST FLAT

                     OPERATING MARGINS IN LINE WITH BUDGET



The following statement was made by the Chairman at the Company's 31st Annual
General Meeting held in London at noon today:


"First, a few comments on current trading over the first five months of 2003.
2003 continues to be another difficult year although better than 2002. However,
there are signs of stabilisation in the advertising and marketing services
industry, particularly in the United States. The prospects for 2004, when the
so-called quadrennial factors operate, do give cause for a little more
medium-term optimism.


On a reportable basis, worldwide revenues were down over 3% as sterling
strengthened against the dollar and the Japanese yen, but weakened comparatively
less against the Euro. Constant currency revenues were up over 1%.


Geographically, again on a constant currency basis, revenues in North America
were up almost 2%. In Europe, the trend was divergent, with the UK down over 3%,
and Continental Europe up over 3%. Asia Pacific, Latin America, Africa and the
Middle East were up over 2%.


By sector, advertising and media investment management revenues were up over 3%,
information, insight and consultancy up almost 4%, public relations and public
affairs down almost 4% and branding and identity, healthcare and specialist
communications down over 1%.


On a like-for-like basis, excluding the impact of acquisitions and excluding the
impact of currency, revenues were almost flat. As a comparative guide this
like-for-like or organic growth rate is conservatively calculated on a proforma
basis, including discontinued operations, which the Company continues to believe
is the most appropriate methodology. Like-for-like revenues were down 6% in the
calendar year 2002.


Despite continuing global geo-political and economic issues the United States
has now shown positive like-for-like growth for the last quarter of 2002 and the
first five months of 2003. The United Kingdom continues to disappoint with
revenues declining in the first five months of 2003. However, Continental
Europe, Asia Pacific, Latin America, Africa and the Middle East continue to
grow, probably against the market, thus increasing our market share.


Our public relations and public affairs businesses are still being most impacted
by the slowdown and to a lesser extent branding and identity, healthcare and
specialist communications, although healthcare and direct have been more
resilient. Advertising and media investment management has been less affected
and information, insight and consultancy continues to show the most resilience.


The Group's operating companies significantly reduced their operating costs
during 2002 and have continued their efforts to adjust staff and discretionary
costs to revenues in the first five months of 2003. Operating margins in the
first five months are in line with budget, which indicated a full year
improvement of up to one margin point. The Company continues to make significant
progress in winning new business from existing and new clients, ranking top in
the CSFB new business survey for the first quarter of 2003, both absolutely and
relatively.


The Group's financial strategy continues to be focused on three objectives:
increasing operating profit by 10 - 15% per annum; increasing operating margins
by up to 1.0 margin points or more per annum, depending on the level of revenue
growth; and reducing staff cost to revenue ratios by up to 0.6 margin points per
annum, again depending on the level of revenue growth.


Currently surplus cash flow amounts to over £400 million per annum. Alternatives
for the use of this cash flow are debt reduction, capital expenditure,
acquisitions, dividends and share buy-backs. Capital expenditure, mainly on
information technology and property, is broadly in line with depreciation. The
Company continues to make small- to medium-sized acquisitions or investments in
high growth geographical or functional areas. The Company's current offer for
Cordiant Communications Group plc (Cordiant), a medium sized acquisition
totalling approximately £265 million, strengthens the Company's services with
existing clients and in Asia, below-the-line marketing, healthcare and branding,
identity and design.


In the first five months of this year, acquisitions apart from Cordiant have
been concentrated geographically in advertising and media investment management
in the United Kingdom, China, Germany, Italy, South Korea and Switzerland; in
information, insight and consultancy in the USA, the UK and Portugal; and in
healthcare in the USA.


Your Board also continues to focus on balancing the option between increasing
the dividend pay-out ratio and share buy-backs, and has continued a rolling
share repurchase programme aimed at buying in up to 2% of the outstanding share
capital each year. So far this year, this has resulted in the purchase of 5.6
million shares at a total cost of £20.2 million and an average cost of £3.60 per
share.


Professionally, the parent company's objectives continue to be to encourage
greater co-ordination and co-operation between Group companies, where this will
benefit our clients and our people, and to improve our creative product. As both
multi-national and national clients seek to expand geographically while at the
same time seeking greater efficiencies, the Group is uniquely placed to deliver
added value to clients with its coherent spread of functional and geographic
activities.


To these ends we continue to develop our parent company talents in five areas:
in human resources, with innovative recruitment programmes, training and career
development, and incentive planning; in property, which includes radical
re-design of the space we use to improve communication as well as the
utilisation of surplus property; in procurement, to ensure we are using the
Group's considerable buying power to the benefit of our clients; in information
technology, to ensure that the rapid improvements in technology and capacity are
deployed as quickly and effectively as possible; and finally in practice
development where cross-brand or cross-tribe approaches are being developed in a
number of product or service areas: media investment management, healthcare, new
technologies, new markets, privatisation, internal communications, retailing,
financial services, entertainment and media, and hi-tech.


In addition, we seek to improve our creative product, in as broadly a defined
sense as possible, by recruiting excellent outside talent, acquiring outstanding
creative businesses, recognising and celebrating creative success and pursuing
creative awards.


It is very easy, when reporting large numbers and significant achievements, to
forget one of the essential truths of our business.


More than in any other major sector I can think of, success in this sector is
dependent on the wit, intelligence, imagination and enterprise of individual men
and women.


Our clients value us for our ability to understand and contribute to their
objectives; and then to apply to those objectives, the alchemy of ideas. The
sort of ideas that can make the investment of a hundred dollars deliver a return
of three or four times that much.


So yes, we have great companies. And yes, increasingly, they work in successful
partnership.


But ideas are born in the minds of individuals. And, for me, one of the great
delights of our trade is the fact that it is individual men and women,
individual minds, individual brains and individual imaginations, that, in
aggregate, make up the sum of your company's achievements.


May I therefore finish by turning the spotlight on those 62,000 individuals who
work for WPP companies around the world. For three years now, they've been
challenged as never before. And for three years now, they have responded
magnificently.


On your behalf, and on behalf of the board, we thank them, salute them - and
devoutly wish them a more benign tomorrow.



For further information, please contact:


Sir Martin Sorrell
Feona McEwan                  Tel: [phone]



www.wpp.com






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