How long can the exultation last, you wonder? The FTSE 100 soared more than 160 points higher, hitting 5,714. Barclays shares rallied hard - up more than 17%. But a member of the Bank of England's Monetary Policy Committee, Paul Fisher, has warned that even if the eurozone crisis is contained, the likelihood of a double-dip UK recession is "significant". More bumps ahead.
We commence with third quarter numbers from WPP. Revenues have grown to £2.46bn compared to £2.25bn this time last year. Like-for-like revenues were up 5%. Revenues in the BRIC region climbed 19% and all markets in Asia, with the exception of Japan, showed double digit revenue growth too - with mainland China up 26.6%.
In terms of the first nine months of 2011, reported revenues climbed 7.1% to £7.17bn, up 12.9% ,in US dollars to $11.573bn and up 5.2% in Euros to €8.225bn. "In constant currencies, revenues were up 8.2%, chiefly reflecting the weakness of the pound sterling against most major currencies."
On a like-for-like basis, excluding the impact of acquisitions and currency fluctuations, "revenues were up 5.6% and the more relevant gross margin up 6.4%." Nervous, risk averse clients, says WPP, "continue to invest in brand rather than in additional capacity in slow growth, predominantly Western markets, but also invest in brand behind new capacity in faster growth markets - a positive double whammy for our industry."
"Our free cash flow has been strong, converting in excess of 100% of our adjusted profit after tax to free cash flow, and as a result net debt as at 30 September 2011 was approximately £520 million, down from £540 million at the start of the year. The group's funding position, following the refinancing of our revolving credit facilities referred to above, remains robust."
There has also been good growth in the Nordic region, especially in Sweden; both Holland and Poland are performing particularly well too. "In the UK and Ireland we continue to grow modestly, with good progress in our UK Healthcare textile maintenance business."
Lastly, another interim, from engineering group Charter International. Trading in the third quarter of the year is in line with Board expectations with a "significant" improvement in ESAB's working capital. Net debt fell to £137.6m as at 30 September 2011, against £155.3m as at 30 June 2011.
"At the interims," says chief executive Gareth Rhys Williams, "we laid out plans for both businesses on growth, margin and working capital, while also being clear that we were exploring all strategic options for Charter."
"The implementation of those plans is progressing well, with ESAB's cost savings and working capital reductions at least in line with expectations."