Final Results - Year Ended 31 Dec 1999, Part 1

WPP Group PLC
17 February 2000


PART 1                            
                  WPP GROUP PLC ('WPP')


PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 1999

Revenues up over 13% to £2.2 billion
Profit before tax up 20% to £255.4 million
Fully diluted earnings per share up almost 20% to 22.5p
Final dividend up 22% to 2.1p



      Revenues up over 13% to £2.173 billion


Profit before interest and tax up 19% to £290.8
million


Operating margins up to 13.4% from 12.8% in line
with objectives


Profit before tax up 20% to £255.4 million


Fully diluted earnings per share up almost 20% to
22.5p from 18.8p


Final dividend up 22% to 2.1p per share making
total for the year of 3.1p up 21% over 1998


Net new billings of over $3.9 billion up 35% on last
year (1998 $2.9 billion)


Narrowly-defined internet-related billings of $270
million and internet revenues of $100 million and
profitable

 
Fourth margin plan to achieve 15% operating margins
by 2002
     
     
Summary of 1999 results

The Board of WPP announces the unaudited preliminary results
for the year ended 31 December 1999.  These results
represent record profits in the Company's fourteenth
year.

Turnover was up 16.8% to £9.346 billion (reflecting the
growth of media investment management), revenues up 13.3%
to £2.173 billion and gross profit up 13.6% to £1.855
billion.  On a constant currency basis, revenues were up
12% and gross profit up 12.4%.  This, in part, reflected
a strong fourth quarter when revenues exceeded $1 billion
for the first time.

Operating profit (excluding income from associates) rose
by 15% to £263.5 million from £229.1 million and by over
15% in constant currencies.  Reported operating margins
(including income from associates) rose by 0.6% to 13.4%
in line with objectives and by 0.8% on a constant
currency basis.  The margin gap between the very best
performing competition and ourselves continues to narrow.
Profit before interest and tax was up 18.6% to £290.8
million from £245.2 million and up almost 19% in constant
currencies.

Operating margins before short and long-term incentive
payments (totalling £71 million or almost 20% of
operating profit before bonus and taxes) rose to 16.7%
from 15.8%.  Operating costs rose by over 13% and by
almost 12% in constant currency.

Variable staff costs as a proportion of total staff costs
have increased over recent years to 11.5% and as a
proportion of revenues to 5.8%.  This has resulted in
increased flexibility in the cost structure.

Net interest payable and similar charges includes net
interest which increased to £23.4 million from £19.2
million, reflecting the increased level of acquisition
activity and share repurchases.  Interest cover, however,
has improved to 8.2X in comparison to 7.6X in the
previous year.

Profit before tax rose by 20% to £255.4 million from
£212.8 million.  Pre-tax margins rose to 11.8% from
11.1%.  On a constant currency basis, pre-tax profits
were up almost 21% reflecting the strengthening of
sterling by 2% against the dollar being more than
counterbalanced by its weakness against Continental
European currencies. If sterling had stayed at the same
average levels as 1998, pre-tax profits would have been
£256.4 million.

The Group's tax rate on profits was 30.0%, an improvement
on the previous year's 31.5%, reflecting the continuous
benefit of tax re-organisations.

Fully diluted earnings per share rose almost 20% to 22.5p
from 18.8p.  In constant currency earnings per share rose
by over 20%.

The Board recommends an increase of 22% in the final
dividend to 2.1p per share, which will be paid in the
form of an ordinary dividend, making a total of 3.1p per
share for 1999, a 21% increase over 1998.


On a like-for-like basis revenues rose by almost 8% and
gross profit was up over 8% on 1998.  Total operating and
direct costs were up 7% on the previous year.  The
Group's staff cost to revenue ratio excluding incentives
was almost  flat at 46.9%.  Staff costs excluding
incentives rose by over 8% and salaries by almost 9%.

Our staff numbers averaged 27,711 against 25,589 in 1998,
up 8.3%.  On a like-for-like basis, average headcount was
up 866 to 27,711 from 26,845, an increase of 3.2%. At the
end of 1999 staff numbers were 29,168 compared with
26,184 in 1998.


Review of operations

In   1999   the   worldwide  advertising  industry   grew
approximately 5-6%.  Our Company continued to  strengthen
particularly in the United States, the United Kingdom and
Continental  Europe.  Asia Pacific continued  to  recover
from  the  recession  that began there  in  1997.   Latin
America  was the most difficult geographical  market  but
year-to-year comparisons started to improve  towards  the
end  of  the  year.   In  1999,  the  Group  believes  it
increased its worldwide market share significantly.

The  real cost of network television - still the  primary
media medium - continues to rise by as much as 5-10%  per
annum  on  both  sides of the Atlantic.  This  is  caused
partly  by  increased pricing by an  oligopoly  of  media
owners and partly by a decline in network audiences.   As
media advertising can represent the most significant cost
to   many   of  our  clients  after  their  manufacturing
expenses,  these  clients  are  increasingly  considering
alternatives  to  television  advertising.   As  long  as
network   price   inflation   continues,   clients   will
increasingly experiment with alternative media  and  non-
traditional  alternatives will continue to  grow  faster,
particularly with the fragmentation of traditional  media
and  the rapid development of new technologies.  1998 was
really   the   first  year  when  WPP's  non  advertising
activities  represented  slightly  over  50%   of   Group
revenues.  In 1999 these activities grew to over  53%  of
Group  revenues.  In addition, in 1999,  narrowly-defined
internet-related  billings totalled  $270  million,  with
internet revenues of approximately $100 million or 6%  of
our advertising revenues, which compares to approximately
2%  for  the  advertising industry as a whole.   Using  a
broader   definition  of  internet-related  revenues   to
include  off-line advertising for on-line brands,  market
research  for on-line brands and healthcare, for example,
would  result in Group internet-related revenues of  over
$500 million or 14% of worldwide revenues.


Revenue and operating profit by region

The pattern of revenue growth differed regionally.  The table
below gives details of revenues and revenue growth (on a
constant currency basis) by region for 1999 as well as
proportions of operating profits.

Region          Revenue as   Revenue gr    Operating
                a            owth          profit as a
                % of Total   % +/(-)       % of Total 
                Group        99/98         Group
                                           
                                           
North America   43.3         16.8          48.0
                                           
United Kingdom  20.1         10.5          17.8
                                           
Continental     20.1         11.0          19.8
Europe
                                           
Asia Pacific,                              
Latin
America, Africa                            
& the
Middle East     16.5         4.0           14.4
                                           
Total Group     100          12.0          100

Net new billings of £2.4 billion ($3.9 billion) were won last year,
up 35% on 1998.

Revenue and operating profit by communications services
sector and brand

The pattern of revenue growth also varied by
communications services sector and brand.  The table
below gives details of revenues and revenue growth by
communications services sector for 1999 (on a constant
currency basis) as well as proportions of operating
profits.

Communications         Revenue  as  Revenue     Operating
services               a            growth      profit as a
                                                
sector                 %  of Total  % +/(-)     % of Total 
                       Group        99/98       Group
                                                
                                                
Advertising, Media                              
Investment Management  46.6         5.2         53.6
                                                
Information       and  19.5         13.9        14.8
Consultancy
                                                
Public Relations  and  8.2          30.5        8.1
Public Affairs
                                                
Identity          and                           
Branding, Healthcare
Specialist             25.7         19.2        23.5
Communications
                                                
                                                
Total Group*           100          12.0        100


* Includes narrowly-defined internet and internet-related
revenue totalling $100 million and broadly-defined
revenues of $500 million.

One of the Group's most important objectives is to
increase its rate of organic revenue growth which is a
key measure of the success of its value-added strategy.
Excluding acquisitions, this was approximately 8% in
1999.  Comparison with our competitors is difficult given
that, to the best of our knowledge, they define organic
growth rates differently absorbing acquisition revenues
into organic growth rates more quickly.  If we were to
use their method of calculation, our organic growth rate
would have been close to 10%.  The high revenue growth
areas of information and technology, telecommunications,
healthcare, financial services and entertainment and
media now account for almost a quarter of Group revenues.
As a benchmark at the end of 1999 these sectors
(excluding healthcare) accounted for approximately the
same percentage of the FTSE 100 by market capitalisation.


Advertising and Media Investment Management

Combined advertising and media investment management
revenues at Ogilvy & Mather Worldwide, J. Walter Thompson
Company and MindShare rose by 5.3%.  Combined operating
margins of Ogilvy & Mather Worldwide and J. Walter
Thompson Company were 15.8%.  Combined operating costs
rose by 5.3% and the combined staff costs to revenue
ratio excluding incentive payments fell to 52.8% from
53.0%. Ogilvy & Mather Worldwide generated net new
billings of £545 million ($899 million) and J. Walter
Thompson Company £507 million ($837 million).

MindShare generated net new billings of £544 million
($897 million), an encouraging start in its first full
year of European and Asia Pacific operations.

Conquest 's revenues rose almost 12% and operating profits and
margins were up sharply.  Net new billings were £39
million ($65 million).

Information and Consultancy

The Group's information and consultancy businesses
continued their strong revenue growth with gross profit
rising by almost 14% but operating costs rose slightly
faster and as a result margins were slightly down on the
previous year.  Particularly strong performances were
recorded by Millward Brown in the United States, United
Kingdom, Italy, Spain, Germany and Singapore; at Kantar Media
Research at BMRB in the United Kingdom; and at IMRB in
India.

Public Relations and Public Affairs

The Group's public relations and public affairs
activities continued to advance strongly.

Hill and Knowlton's revenues rose by over 17% and
operating costs by almost 16%.  As a result, margins
increased to over 11%, ahead of previously established
targets and schedule.

Ogilvy Public Relations Worldwide's revenues rose by over
79% and operating costs by approximately 71%.  For the
third year in a row following the change in leadership,
profitability and margins improved significantly over the
previous year.

Our public relations and public affairs businesses as a
whole showed operating margins of over 13%, in excess of
the Group's objective for 1999 and in line with the best
performing publicly listed competition.  Operating
management has developed new three year plans that
indicate further significant improvement in operating
margins.

Identity and Branding, Healthcare and Specialist
Communications

Identity and branding, healthcare and specialist
communications revenues rose by over 19%.  Gross profit
rose by over 23% and operating costs by almost 21%.  As a
result, overall operating margins increased. Several of
our companies in this sector performed particularly well,
including in promotion and direct marketing - RTCdirect,
EWA, OgilvyOne, A Eicoff & Company; in identity and
branding - Brouillard and Enterprise IG Group; in
healthcare - Thomas Ferguson Associates and OZM Group and
in other specialist marketing resources - The Henley
Centre, JWT Specialized Communications, Management
Ventures, Pace Communications Group, The Geppetto Group,
Savatar and Mendoza Dillon & Asociados.

wpp.com

In 1999 a new media parent company, wpp.com, was formed
with WPP Non-Executive Director Esther Dyson as Chairman
and WPP Strategy Director Eric Salama as Chief Executive.
Like WPP itself and Kantar, wpp.com is a parent company
seeking to add value in the areas of new media and
technology to clients and people and accelerate the
development of our interactive capabilities and revenues.
wpp.com will co-ordinate all our new media activities
across our operating brands.

Our pure internet revenues (web-based work) for 1999 were
over $100 million, while a broader definition (which, for
example, would include branding work for dot com clients)
would result in revenues of approximately $500 million.
Our budgets for 2000 for the narrowly based definition of
interactive work show growth rates in excess of 50%. It
will become increasingly difficult to accurately identify
the overall impact on our revenue base given the
strategic importance of the web to our largest clients
(such as our three biggest - Ford, Unilever and IBM) and
the increasing importance which clients are attaching to
differentiating themselves against traditional and new
competitors.

To date wpp.com has concentrated on strengthening our
existing operations, acquiring new operations in areas
which we think are critically important, investing in
start-up internet companies with whom we wish to partner
and spreading knowledge of these developments around our
organisation.

Our most important wholly-owned internet operating
companies include Ogilvy Interactive, the strongest
global agency in the market, recent winner of the
majority of the first Cyber Lions at Cannes, AdAge's
International Interactive Agency of the Year and one of
AdWeek's top ten hot interactive shops in 1999;
digital@jwt, which has recently won a series of web
accounts in the United States; MindShare, which in
combination with Ogilvy Interactive is the largest buyer
of internet media in the world; Kantar Interactive, whose
constituent parts include MBInteractive (widely regarded
as the most advanced internet-based research company),
Intelliquest (the leading company in market research for
hi-tech clients) Lightspeed (Kantar's e-mail based
internet panel), and RI Interactive (a leader in web
based focus groups); AlexanderOgilvy, Ogilvy Public
Relations Worldwide, Blanc & Otus and Hill and Knowlton
who between them work with over 400 dot com clients on
public relations and public affairs around the world; and
Career Agent, a software tool developed by JWT
Specialized Communications to help recruitment sites
profile potential employees.

Wpp.com

wpp.com also has minority stakes in internet and
interactive marketing services companies such as Syzygy,
UK Web Agency of the Year, United Media in Germany and
Netforce in France, all three of which will merge shortly
to create a pan-European e-services group and will
probably be floated.

Major clients of wpp.com include IBM, Ford, Merrill
Lynch, Sears, De Beers, Unilever, Siemens, QXL,
Freeserve, Qwest, Mindspring, Nextcard, Ariba,
Healtheon/WebMD, DrKoop, Chemdex, Instinet, iPlanet,
Idealab, Boots, El Sitio, Medscape, Ameritrade, E-Trade,
Ziff Davis and DoubleClick.

The CEOs of wholly-owned new media operating companies
will continue to report into their existing management
but will have a dotted line responsibility to wpp.com.
wpp.com's Board includes the senior management of our
major interactive operations. Our interactive equity
investments have been made indirectly through venture
funds and directly.  The aim of these indirect
investments has been to keep abreast of Silicon Valley
developments and identify potential client relationships
- thus enhancing our core capabilities.  Historically the
prime venture fund through which we have made indirect
investments has been Media Technology Ventures (MTV)
(www.mtventures.com) which has a West Coast United States
focus.  MTV investments have included Medscape, Quokka
Sports and Talk City - all recently floated on Nasdaq.

wpp.com has now agreed to invest money and become the
preferred marketing partner to a new fund, Dawntreader
Fund II, established by leading on-line investment
banking firm, Wit Capital, and has entered into a
memorandum of understanding with leading Latin American
investors to establish a fund and invest jointly in that
region.  wpp.com has also increased the number of direct
investments it has made in B2B companies, recent examples
including Intraspect (developers of knowledge management
software), Concept! (the second largest German web
development company - also probably to be floated), TWIi
(the internet arm of IMG Group, the world's leading
sports marketing company), e-Rewards (an e-mail based
loyalty company) and Visible World (software which allows
the customisation of creative content on websites in real
time).  Past investments have included BroadVision,
Peapod and HyperParallel. The gross cost of these
investments (including commitments made  totals
approximately $75 million.  WPP does not consolidate any
revenues from these investments but may realise the
stakes at some stage in the future.

Manufacturing

Revenues and operating profit were flat at the Group's
manufacturing division.


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