10th Nov 2021 11:55
S4 Capital PLC - London-based advertising and marketing agency - S4 says it is focused on landing "whopper" clients, as it reports a big rise in third-quarter revenue. Executive Chair Martin Sorrell says S4 has secured 6 such clients and has identified 19 more as potential clients. This helps gross profit, or net revenue, to rise by 92% from a year before to GBP144.4 million in the third quarter that ended September 30 from GBP75.3 million a year before. Growth is supported by 10 acquisitions made in the year to date. On a like-for-like basis, net revenue growth is 42% in the third quarter. S4 says it is trading in line with external revenue expectations.
However, Sorrell warns that S4 is prioritising top-line growth, and the investment required to do this will cut into profit margins. "The pandemic has proven to be an accelerator of digital marketing transformation and we are taking full advantage of this opportunity by choosing to invest a proportion of our [earnings before interest, tax, depreciation and amortisation] margin in growth," Sorrell says.
Current stock price: 689.00 pence, down 12% on Wednesday
Year-to-date change: up 38%
By Tom Waite; [email protected]
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