Sorrell’s S4 Capital posts revenue rise as mergers help to reel in new clients
Sir Martin Sorrell’s new advertising venture S4 Capital has posted a large rise in revenue for the year after a string of acquisitions helped it land big-name clients.
Read more: S4 Capital ready to compete 'at the highest levels' after Mightyhive merger
The figures
Revenue jumped 58 per cent year-on-year to £54.8m.
Billings hit £59.1m.
The firm posted a pre-tax loss of £9.1m.
S4 Capital’s net debt was £20.6m.
Why it’s interesting
Sir Martin Sorrell caused a stir in the advertising industry when he founded S4 Capital after stepping down as WPP boss last year amid allegations of misconduct.
Sorrell has since embarked on an aggressive acquisition strategy, snapping up Dutch firm Media Monks for more than £260m and programmatic company Mightyhive for £115m.
The deals appear to have paid off, as S4 Capital has seen a sharp rise in revenues and has secured business from the likes of Procter & Gamble, Nestle and Mondelez.
The firm said its debt levels were driven largely by a £45.6m loan drawn to help fund the Media Monks takeover.
Sorrell said the results reflect its successful focus on digital marketing.
S4 Capital recently hired advertising veteran Poran Malani to direct its Indian business as it looks to open offices in Mumbai and Bangalore. The firm now has roughly 1,200 employees in 16 countries.
Sorrell outlined a three-year plan to double the firm’s revenue and gross profits compared to 2018, with an improvement in its earnings margin.
Shares in S4 Capital ticked up half a per cent in early trading.
Read more: Sorrell’s S4 says talks to buy ad firm Mightyhive are now ‘advanced’
What S4 Capital said
Chairman Sir Martin Sorrell said: “It is clear that the company’s purely digital model based on first party data fuelling digital content and programmatic is resonating with clients.
“Our tagline ‘faster, better, cheaper’ and unitary, one profit and loss structure also appeal strongly.
“The imperatives will be to broaden and deepen relationships with existing and new clients; to broaden and deepen geographical coverage; and to attract additional data, content and media talent and resources through direct recruitment, acquisition and/or merger.”