Business booms at S4 Capital as it tees up its second takeover

Sir Martin Sorrell’s new outfit, S4 Capital, posted strong sales growth in the third quarter, the company said today.

The firm, which was set up after Sorrell left advertising giant WPP, delivered revenues of over €29m (£26.2m) in the quarter, a rise of almost 45 per cent.

Gross profit, meanwhile, shot up 32 per cent to €20.4m, a 32 per cent rise year-on-year.

Discounting the effects of acquisitions and currency fluctuations, like-for-like revenue grew 46 per cent, with gross profit increasing by a third.

Sorrell set up the new company after leaving WPP amid allegations of personal misconduct.

The venture confirmed last week it is in talk with US advertising firm Mightyhive in a deal which is believed to value the firm at up to $200m (£154m).

It would be Sorrell’s second acquisition after beating his former company WPP in a battle for Dutch agency Media Monks in July.

Media Monks has shown strong growth in the US in the third quarter, the company said, opening a new office in San Francisco has opened to complement those in New York and Los Angeles. The company will continue to expand in Asia Pacific, Latin America, the Middle East and Africa in 2019, it said.

Sorrell, the executive chairman of S4 Capital, said: “Trading is very much in line with our objectives for this first quarter since the merger with Media Monks. We are delighted that Media Monks was able to deliver continued significant growth, even during the integration of the company into S4 Capital plc and the re-listing and name change of the company on the London Stock Exchange, at the end of the third quarter.

“We already see both a widening and deepening of the company’s client base, resulting in a strong performance for all three pillars at Media Monks. A focus on digital content, digital media planning and buying and first party data, along with an emphasis on ‘faster, better, cheaper’ executions, clearly resonates with clients of all shapes and sizes.

“We are already planning significant expansion of the group’s services in digital media planning and buying and content and geographically, particularly in the United States and Asia Pacific.”