S4 Capital claims increase in profits – ‘major package goods brand’ in SE Asia

According to a trading update, S4 Capital has seen a 40% increase in like-for-like revenues and gross profit. 

Among the developments that contributed to growth were said to be “the award of a major package goods brand in South East Asia” besides assignments from P&G’s Braun, Nestle Starbucks and programmatic consultancy assignments with Bayer, Electrolux, Mondelez, Sephora and Renault 

The announcement: 

S4 Capital, the new age/new era digital advertising and marketing services company, is pleased to report continued trading progress in the first half of 2019, with further strong revenue and gross profit growth. 

Like-for-like revenues and gross profit were up around 40%, growing faster than the targeted rate required to double the Company’s revenues and gross profit organically over the three years to 2021.

Both sterling reportable revenues and gross profit have strengthened slightly since our AGM statement in May and were up well over 40%. As also mentioned in the AGM statement, pro-forma reported operating EBITDA margins were lower than last year, reflecting increased human capital investment (a doubling of the like-for-like headcount) and geographical expansion, both at MediaMonks in digital content and MightyHive in programmatic, and the relatively stronger operating EBITDA margins at MediaMonks in the first half of last year.

Reported pro-forma operational EBITDA margins are expected to improve from the first half of the year to the second half, reflecting an even stronger second half at MightyHive in programmatic and an easier second half operating EBITDA margin comparison at MediaMonks in content. Operating cash flow remains strong with net debt approximately halved from the level incurred to part fund the MediaMonks merger.

Prestigious global digital content assignments at Procter & Gamble’s Braun and Nestle’s Starbucks have been followed by the award of a major package goods brand in South East Asia and programmatic consultancy assignments at Bayer, Electrolux, Mondelez, Sephora and Renault. 

Sir Martin Sorrell, Executive Chairman of S4 Capital plc said: “The continued top-line revenue and gross profit momentum at twice the digital market’s growth rate clearly demonstrates the contemporary relevance to clients, of the purely digital, “faster, better, cheaper”, unitary, first party data, content and programmatic model. We are investing in human capital and new geographies at a faster than anticipated rate, to take our “holy trinity” model to the next level and this has flowed through to operational EBITDA margins in the first-half and we expect margin expansion in the second half of the year.”                                                           

The Company will report results for the six months ending 30 June on 11 September 2019.

Source: S4 Capital press release


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