3rd Quarter Results

WPP Group PLC
27 October 2006


FOR IMMEDIATE RELEASE                                            27 October 2006


                                        
                                      WPP
                                     
                                       
                            QUARTERLY TRADING UPDATE
                                       
                                        
                  REPORTED REVENUES UP 12% IN FIRST NINE MONTHS
                                        
                                        
    LIKE-FOR-LIKE REVENUES AND GROSS MARGIN UP ALMOST 5% IN FIRST NINE MONTHS
                                        
                                        
                     THIRD QUARTER REPORTED REVENUE UP 4.6%
                                        
                                        
    THIRD QUARTER LIKE-FOR-LIKE REVENUES UP OVER 4% AND GROSS MARGIN UP 4.6%
                                        
                                        
             FULL YEAR OPERATING MARGIN IN LINE WITH REVISED TARGET



Revenue Growth - Nine Months

In the first nine months of 2006, reported revenues were up 12%. In constant
currencies, revenues were up 11%, with currency having little overall impact. On
a like-for-like basis, excluding the impact of acquisitions and currency
fluctuations, revenues were up 4.7% and gross margin up 4.9%.

As shown in the appendix to this release, on a constant currency basis, the
geographical pattern of revenue growth varied in the first nine months. In North
America, revenues were up over 10%, which marks the thirteenth consecutive
quarter of growth. The United Kingdom and the western markets of Continental
Europe remain more challenging, although the latter improved over the second
quarter. The United Kingdom and Continental Europe as a whole, were up over 7%,
with the United Kingdom up almost 5%. Asia Pacific, Latin America, Africa and
the Middle East, have shown consistent growth in each quarter of 2006, and for
the first nine months of 2006 revenue across these regions rose over 20%.

By communications services sector, Branding and identity, healthcare and
specialist communications showed the strongest growth with revenues up almost
16%, including significant improvement in the Group's direct, internet and
interactive related activities across the major brands at OgilvyOne, RMG
Connect, Wunderman and G2 and, as a result, gained market share. Public
relations and public affairs revenues continued the improvement over last year,
with revenues up over 12%, despite strong comparable growth in 2005.
Information, insight and consultancy was up 10% for the first nine months of
2006, with the Group's advertising and media investment management up over 8%.

Revenue Growth - Third Quarter

In the third quarter, reported revenues rose by 4.6% to £1.411 billion.
Revenues, in constant currencies were up 7.8%, the difference being primarily
due to the weakness of the US dollar against sterling. On a like-for-like basis,
excluding the impact of acquisitions and currency fluctuations, revenue growth
was up over 4% and gross margin up 4.6%.

As shown in the appendix to this release, on a constant currency basis, the
geographical pattern of revenue growth varied in the third quarter, although all
markets performed well with the exception of Western Europe. In North America,
revenues were up over 8%, with the United Kingdom up over 1% and Western
Continental Europe up over 3%. Asia Pacific, Latin America, Africa and the
Middle East continued to perform well, with revenues up almost 16%.

By communications services sector, public relations and public affairs showed
the strongest growth, with revenue up almost 14%, followed by branding and
identity, healthcare and specialist communications up almost 12%. Information,
insight and consultancy was up over 8%, and advertising and media investment
management up over 4%.

New Business

Net new business billings of £1,431 million ($2,647 million) were won during the
third quarter. Net new business billings won in the first nine months of 2006
were $5.5 billion, an increase of almost 19% compared with the first nine months
of 2005 - which was itself a record. The Group was rated number 1 in two of the
three major new business surveys and number 2 in the third. The Group continues
to benefit from consolidation trends in the industry, winning several large
assignments from existing and new clients.

Current Trading

Like-for-like growth, in the third quarter, was marginally below that seen in
the first half of the year, due in part to pressure in the United Kingdom and a
slower rate of growth in Eastern Europe in the third quarter.

Third quarter revised forecasts indicate that the Group's operating margin for
the year is in line with the Group's headline operating margin target of 14.5%,
as compared to 14% in 2005.

Prospects for improvements in trading performance remain good. The Group's
margin targets for both 2006 and 2007 were last raised at the time of the 2005
annual results announcement. As indicated above, the latest forecasts show that
the Group is on track to meet its target for this year, despite continuing
concerns amongst some commentators about the prospects of the United States
economy, its twin deficits, the indebted consumer and the direction of interest
rates and commodity prices, and their impact on inflation.

The first nine months of 2006 have seen strong like-for-like growth of almost
5%. Industry experts are still forecasting that advertising and marketing
services will grow at 4% this year, which for the first nine months, the Group
has exceeded, therefore growing market share.

Balance Sheet and Cash Flow

The Group continues its strategy of using free cash flow to enhance share owner
value through a combination of necessary capital expenditure, strategic
acquisitions, dividends and increased share purchases.

In the first nine months of 2006, the Group continued to make small to
medium-sized acquisitions or investments in high growth geographical or
functional areas. In the first nine months of this year, acquisitions and
increased equity stakes have been concentrated in advertising & media investment
management in the United States, the United Kingdom, Germany, South Africa,
Israel, China, Singapore, New Zealand and Brazil; in information, insight &
consultancy in the United States, Spain, Hong Kong and China; in public
relations & public affairs in the United States, Canada and India; in healthcare
in the United States, the Netherlands and Switzerland and in direct, internet &
interactive in the United States, Germany and China.

Consistent with the recently announced objective of increasing the share
buy-back programme, in the first nine months of 2006, 33.6 million ordinary
shares were purchased, equivalent to 2.7% of the share capital. Of these shares
5.7 million were acquired by the WPP ESOP in connection with restricted stock
awards, and 27.9 million were cancelled. These shares were acquired at an
average price of £6.63 per share and total cost of £222.5 million. Also, in the
first nine months 16.4 million shares, equivalent to 1.3% of the share capital,
were issued as a result of option exercises by our people.

Average net debt for the first nine months of 2006 was £1,222 million, compared
to £1,088 million in the comparable period last year, at 2006 average exchange
rates. This represents an increase of £134 million, a slight improvement over
the increase of £150 million in the first six months of 2006, and reflected the
acquisition of Grey Global Group. Net debt at 30 September 2006 was up slightly
at £1,332 million against £1,283 million at the same time last year, at 2006
average exchange rates, an increase of £49 million. Net debt figures reflect
£840 million spent on capital expenditure, acquisitions and earnout payments,
share purchases and dividends in the previous 12 months, approximately matched
by cash flow before capital expenditure, acquisitions and earnout payments,
share purchases and dividends over the same period of £855 million.

Future Objectives

The Group continues to focus on its strategic objectives of improving operating
profits by 10 to 15% per annum; improving operating margins by half to one
margin point per annum; improving staff cost to revenue ratios by 0.6 margin
points per annum; growing revenue faster than industry averages; developing
creative leadership and stimulating co-operation among Group companies.


For further information:

Sir Martin Sorrell           )
Paul Richardson              )     + 44 (0)207-408-2204
Feona McEwan                 )
Fran Butera                        + 1 212-632-2235



www.wppinvestor.com





This announcement has been filed at the Company Announcements Office of the
London Stock Exchange and is being distributed to all owners of Ordinary shares
and American Depository Receipts. Copies are available to the public at the
Company's registered office.


The following cautionary statement is included for safe harbour purposes in
connection with the Private Securities Litigation Reform Act of 1995 introduced
in the United States of America. This announcement may contain forward-looking
statements within the meaning of the US federal securities laws. These
statements are subject to risks and uncertainties that could cause actual
results to differ materially including adjustments arising from the annual audit
by management and the Company's independent auditors. For further information on
factors which could impact the Company and the statements contained herein,
please refer to public filings by the Company with the Securities and Exchange
Commission. The statements in this announcement should be considered in light of
these risks and uncertainties.




Appendix: Revenue and revenue growth by region and communications services
sector

9 months ended 30 September 2006

---------------      ----------      ---------       ---------      ----------
                        Revenue        Revenue         Revenue        Constant
                           2006           2005          Growth        Currency
Region                       £m             £m        Reported       Growth(*)
                                                         06/05           06/05
                                                             %               %

North America            1,692.4       1,512.7            11.9            10.3

United Kingdom             622.3         593.4             4.9             4.9

Continental Europe       1,087.5         995.8             9.2             9.2

Asia Pacific, Latin
America, Africa &
Middle East                872.8         714.0            22.2            20.2
---------------       ----------     ---------       ---------      ----------

Total Group              4,275.0       3,815.9            12.0            11.0
---------------       ----------     ---------       ---------      ----------

---------------       ----------     ---------       ---------      ----------
Communications           Revenue       Revenue         Revenue        Constant
Services                    2006          2005          Growth        Currency
Sector                        £m            £m        Reported       Growth(1)
                                                         06/05           06/05
                                                             %               %

Advertising & Media
Investment
Management               2,010.5       1,833.0             9.7             8.5

Information, Insight
& Consultancy              652.7         591.0            10.4            10.0

Public Relations &
Public Affairs             438.1         385.9            13.5            12.3

Branding & Identity,
Healthcare and
Specialist
Communications           1,173.7       1,006.0            16.7            15.9
---------------       ----------     ---------       ---------      ----------

Total Group              4,275.0       3,815.9            12.0            11.0
---------------       ----------     ---------       ---------      ----------


(*) Constant currency revenue growth excludes the effect of currency movements.



Appendix: Revenue and revenue growth by region and communications services
sector


3 months ended 30 September 2006

---------------       ----------      ---------      ---------       ----------
                         Revenue        Revenue        Revenue        Constant
                            2006           2005         growth        Currency
Region                        £m             £m       reported        growth(1)
                                                         06/05           06/05
                                                             %               %

North America              557.0          539.3            3.3             8.3

United Kingdom             207.2          204.5            1.3             1.3

Continental Europe         346.1          333.4            3.8             4.6

Asia Pacific, Latin
America, Africa &
Middle East                300.3          271.2           10.7            15.8
---------------       ----------      ---------      ---------       ----------

Total Group              1,410.6        1,348.4            4.6             7.8
---------------       ----------      ---------      ---------       ----------


---------------       ----------      ---------      ---------       ----------
Communications           Revenue        Revenue        Revenue        Constant
Services                    2006           2005         Growth        Currency
Sector                        £m             £m       Reported        growth(*)
                                                         06/05           06/05
                                                             %               %

Advertising & Media
Investment
Management                 656.1          648.3            1.2             4.3

Information, Insight
& Consultancy              213.8          203.5            5.1             8.2

Public Relations &
Public Affairs             147.8          134.1           10.2            13.7

Branding & Identity,
Healthcare and
Specialist
Communications             392.9          362.5            8.4            11.9
---------------        ----------      ---------      ---------      ----------

Total Group              1,410.6        1,348.4            4.6             7.8
---------------        ----------      ---------      ---------      ----------


(*) Constant currency revenue growth excludes the effect of currency movements.








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