WPP smashed annual profit records for the second year in a row in 2012 but the advertising giant's chief executive Sir Martin Sorrell yesterday admitted "we got there ugly".
He also warned the Tories' decision to hold a referendum on European Union membership is casting uncertainty over the UK's economic prospects.
Sir Martin, pictured, warned last year of four "grey swans" of global uncertainty – Europe, the Middle East, China and America – which posed a risk to growth and he said the prospect of a British referendum after 2015 was now "a fifth grey swan" undermining clients' confidence.
"The uncertainty diminishes their willingness to make decisions and invest," declared Sir Martin, who runs the world's biggest advertising and marketing group, representing dozens of multinational clients including HSBC, Vodafone, Unilever and Barclays.
Pre-tax profits in 2012 jumped 8 per cent to almost £1.1bn but underlying sales rose only 2.9 per cent £10.4bn, below the 4 per cent forecast a year ago.
"We reached our targets, but we got there ugly," said Sir Martin, who said clients were risk averse and reluctant to spend.
North America was surprisingly weak, slipping into negative territory. He said the United States' budget deficit was a bigger worry than Europe.
The dividend is up 16 per cent.
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