WPP feeling pressure on grimads prospects

SIR Martin Sorrell's advertising outfit WPP was a flat market ahead of tomorrow's trading news with the price falling 9p to 452p, making it one of the biggest fallers among the blue-chips.

Brokers are expecting a drop in interim pre-tax profits from pounds 253 million to pounds 215 million and say there is little prospect of a pickup in the advertising industry. Sir Martin is already on record as saying he does not expect an improvement for several years at least. On Friday, broker WestLB Panmure issued a sell note on the shares to clients. Analysts say the downturn in financial markets is also starting to have an impact on the group with corporate advertising going into a nosedive.

Share prices generally made a cautious start. In thin trading the FTSE 100 managed to claw back an early 22-point deficit to trade 13.8 up at 4343.8.

Miss Selfridge and Dorothy Perkins retailer Arcadia jumped 471/2p to 348p after rejecting the terms of a cheeky bid from entrepreneur Philip Green, the man behind the revival of rival stores group Bhs.

Green has offered the equivalent of 365p a share, valuing Arcadia at pounds 690 million. The board of Arcadia said the offer undervalued the company. Green says he has the backing of Arcadia's biggest shareholder, the Icelandic retailer Baugur, which holds 20% of the company. Earlier this year, Green held bid talks with Woolworths.

The talks broke down and the Woolies' share price has since slumped to 261/2p. Two years ago he toyed with the idea of bidding for Marks & Spencer, up 9p at 354p.

Contract caterer Compass rose 3p to 315p ahead of a visit by brokers to its facilities in central London. It follows the group's move to a different sector earlier this year and will focus on corporate strategy. The company says it will not provide a trading update or reveal any new financial-news.

Granada firmed 31/2p to 781/4p with Carlton Communications adding 4p at 133p after the companies announced plans to forge closer ties with the aim of cutting costs and generating more advertising revenue. They are expected to merge fully once the regulations relating to cross-holdings and ownership of media companies are relaxed.

Telecoms equipment maker Spirent slipped 2p to 68p after broker UBS Warburg downgraded the shares from hold to reduce and slashed its target price from 100p to 55p. Warburg has also resumed coverage of printer St Ives, unmoved at 3411/2p, with a hold rating and a 375p target price.

An impressive increase in interim profits at computer systems provider Systems Union was rewarded with a jump of 51/2p to 621/2p. Earnings before interest, tax and amortisation grew from pounds 1.4 million to pounds 3.8 million and chief executive Peter Coleman is confident about the future. It is sitting on almost pounds 16 million in the bank. That has succeeded in pushing net assets up from pounds 3.9 million to pounds 20.9 million.

AIM-listed Getmapping, in which the Queen has invested, put on 11/ 2p to 61/4p after confirming late on Friday that it has made a pact with the Ordnance Survey to create a seamless colour photographic mosaic of the UK.

Fresh support was shown for troubled Cookson with the price adding 2p to 27p.

It now stands only 2p above the terms of its rescue rights issue announced last month, where the price stood at 50p.

Prices and indices in this section are supplied from various sources and calculated at different times and may not always match those listed in the tables. Ofex prices relate to the previous close.

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