“I don’t know that 1 percent qualifies for putting us in the growth club, we are now forecasting 2 percent [like-for-like] revenue growth for the year,” said Sorrell, who has lifted the hiring ban in growth markets, with a 1 percent increase in staff since the start of the year.

“We haven’t put our neck out there having been too optimistic last year [WPP predicted revenues to fall 2 percent and they fell 8 percent]. We are probably being a little too pessimistic this year. It is a case of once bitten, twice shy.”

WPP said that it was too early to say whether the stabilisation in the first quarter would be sustained and that it had predicted growth would not occur until the second quarter.

In the first quarter WPP’s revenues on a reported basis were £2.08bn, a year-on-year fall of just under 2 percent. On a constant currency basis, which reflects the strength of the English pound against the US dollar and Euro equated to a 0.5 percent year-on-year rise.

Sorrell said that the first quarter results were a case of “America bites back”. The US market, which was one of the worst hit last year, reported a remarkable turnaround with constant currency growth of 4 percent in the first three months. By comparison WPP’s US operations saw revenue fall by 5 percent in the final quarter of 2009.

WPP said that the stabilisation in the first quarter was also fuelled by the United Kingdom which had “positive” growth. The UK fell 6 percent on a like-for-like basis in 2009, although the rest of Western continental Europe remains the “most challenged” region with revenues down over 1 percent in the quarter. WPP’s two biggest markets in Asia, mainland China and India, showed combined growth of more than 5 percent.

“In the first quarter, revenues, profits and operating margins were well above budget and profits and operating margins were well ahead of last year,” said WPP. “As a result of increased profitability, incentive pools began to be refilled. Actual revenues were tracking 3 percent above budget for the first quarter.”

WPP, which cut headcount by about 12.3 percent or almost 14,000 employees in 2009, actually increased staff levels by 1 percent compared to leveLs at 1 January as the hiring ban was lifted in growth areas such as the US, Asia and Latin America. However, WPP, which employs about 100,000 staff, said that levels were still down about 10 percent compared overall compared with the first quarter of 2009.

WPP’s rival Publicis Groupe posted a 3.1 percent revenue increase in the first quarter, its first growth since 2008, which was hailed by chief executive Maurice Lévy as “exceeding even our most optimistic forecasts”.

Similarly Vincent Bollore’s Havas reported year-on-year organic growth of 1.5 percent in the first quarter, its first since 2008.