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For Personal Use Only Use Personal for 2 WPP AUNZ Annual Report 2017 1 Annual Report 2017 For personal use only 2 WPP AUNZ Efficiency Scale Local Capability Optimisation Growth Connectivity Global Expertise Creativity Speed Ideas For personal use only Passion Agile Annual Report 2017 3 Contents Welcome to WPP AUNZ ...........................................................................................................................................................................4 Our companies .........................................................................................................................................................................................................6 Chairman’s letter ......................................................................................................................................................................................................8 CEO’s report ..................................................................................................................................................................................................................10 Our four strategic pillars..........................................................................................................................................................................12 Fact Trumps Fiction .......................................................................................................................................................................................... 14 A Front Row Seat to a Brave New World ............................................................................................................... 16 Why Rewarding Horizontality Brings out the Best in Our People ........................... 18 The Board of Directors .............................................................................................................................................................................24 Financial performance .............................................................................................................................................................................26 Directors’ Report ..................................................................................................................................................................................................28 Operating and financial review ................................................................................................................................................31 Auditor’s independence declaration ...........................................................................................................................35 Remuneration Report ............................................................................................................................................................................... 36 Financial statements .....................................................................................................................................................................................52 Directors’ declaration...................................................................................................................................................................................111 Independent auditor’s report.................................................................................................................................................... 112 ASX additional information .............................................................................................................................................................116 Corporate directory.....................................................................................................................................................................................118 For personal use only 4 WPP AUNZ Welcome to WPP AUNZ WPP AUNZ is Australasia’s largest and most successful marketing ways of reaching our clients’ customers, the Australians and services group. We are the fifth largest market in the world for WPP. New Zealanders who buy our clients’ products and services. WPP AUNZ is made up of the leading companies in the following Today we have advanced this philosophy of horizontality. marketing and communications disciplines: Advanced horizontality brings to our clients more streamlined team models. A dedicated group of experts who work on Advertising a client’s business day-to-day with specialists brought in Media Investment Management where and when needed. A more intelligent way of working. Data Investment Management Streamlined processes and a method that removes duplication. Public Relations and Public Affairs Branding and Identity The ultimate result of horizontality is that it is far simpler for Healthcare Communications our clients to get the very best work from us. It enriches our Digital, Technology and e-Commerce Marketing people, and the team models allow for the sharing of skills Shopper Marketing and the teaching of better ways to work. The greatest asset we Content Production have is our highly talented workforce. Sharpening their skills and Specialist Communications. keeping them in continuous learning mode is the difference between good and great. Wherever a client might need to speak to a customer, be it via a social media post, or on a supermarket shelf, or via an The merger continues to be a success. As we deepen and online video or on a piece of packaging design, or through a strengthen the connections among our 80 companies, we are TV campaign, or in any of the hundreds of channels where also strengthening the relationships with our clients. This in turn customers seek out information, WPP AUNZ is there. allows us to achieve that ambition of servicing as much of our clients’ marketing budgets as possible, all under the WPP AUNZ Our business objective over the last two years has been roof. It is a healthy ambition because when we do achieve this (and continues to be), to service 100% of a client’s customer for our clients, the quality of ideas is outstanding, simplicity experience needs. This leads to our higher mission, which is to of working together is achieved and any wastage of time or apply a range of marketing communications tools to help our money is minimised. Clients are happy and so are our people. clients achieve real growth – in a challenging marketplace, where real growth is increasingly difficult to find. In the end, our role is to find the best and most effective ways to communicate to consumers on our clients’ behalf. To market There are 80 companies within our Group and each has its their products and services successfully and to do it in a way own distinctive brand and identity. Each offers its own unique that benefits the economy, benefits our people and reinforces expertise to its clients. our clients’ decision in having chosen WPP AUNZ. Among them, our companies work for many of the top 200 ASX-listed businesses in Australia and New Zealand. It has been almost two years since we merged STW and WPP in Australasia to form WPP AUNZ. In that time, we have put into practice our own way of working which we call ‘connected know-how’ and it is how we have been driving WPP’s strategy of horizontality. Horizontality has always been about driving collaboration across theFor personal use only Group to the benefit of our clients as well as our people. Mixing together the best talent from across our 5,500 people results in far stronger ideas, far better execution and the best Annual Report 2017 5 For personal use only 6 WPP AUNZ Our companies Our 80 companies are diverse. That is their strength. When attitudes, biases and opinions which help shape not only the they come to the table to collaborate or to be part of a messages, but the business models we might recommend to newly-created team model, they each have a clear role to our clients when reinventing their businesses. Our data scientists play. They have clear skills they must bring into the room. are committed to simplifying and separating useful intelligence from the mountain of information most of our clients have access Clients seek expertise. They seek to access the most talented to every day. In keeping with our overall principles of clarity people in their field, be it in the guise of strategic planning, and simplicity, our data and research businesses interpret and or social media management, or campaign development, recommend the best course of action to our clients. or creative thinking, or design-thinking, or any of the dozens of disciplines we deliver to our clients on a daily basis. Our public relations companies, like Ogilvy PR and Pulse, are helping consumer brands find their authentic voice with their Our technology companies, like AKQA and Aleph, are audience, and our financial public relations companies like developing the next frontier of digital delivery for our biggest Cannings are helping corporate Australia manage strategic clients: banks, telecommunications companies, retailers and communications, be it a merger or an acquisition or crisis innovators. Rather than talk about the much quoted ‘disruption management, if it is ever needed. of business models’ they are building these models and testing them alongside our clients. Nothing speaks to expertise and Our companies like Hogarth and WPP Health and Wellness, work capability more than being a pioneer. across the entire Group. Hogarth is a full-service production company built for the digital age and can produce
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