WPP, the world's largest ad firm by sales, lifted its outlook for the year after a strong performance from the US and traditional media resulted in solid growth in the first seven months.
Shares in the Martin Sorrell-led group were lower, however, after strong performances from rivals had pushed up expectations ahead of the update.
Omnicom Group reported forecast-beating quarterly results in July and said major clients were back on the spending offensive, while Publicis also posted strong results and raised its outlook. Analysts said, in comparison, the WPP first-half numbers were lacklustre, while July's performance was better and the outlook encouraging.
WPP also said it was still seeing caution from major companies due to uncertainty in Europe around the impact of austerity measures, fiscal contagion from Greece, Portugal, Spain and Ireland and concerns over US growth.
WPP, whose clients include Vodafone and Unilever, posted a 3.1% rise in key organic revenue for the first seven months of the year and said it could beat this over the full year as trends continue to improve. It had previously forecast a full-year target of 2%.
It posted first-half like-for-like revenue up 2.5%, towards the lower end of forecasts, but said it had enjoyed a strong July. It raised its dividend by 15% and said it would target a level of diluted headline earnings per share in 2010 similar to the level achieved in 2008, the previous all-time high.
The firm said organic sales in the first half were boosted by 'remarkably strong growth' in the US, an improved performance in Britain and strong growth in southeast Asia.
The June-July soccer World Cup boosted Africa and Brazil, helping July to the strongest growth of all, up almost 7%.
