Monday 4 November 2019 11:42 am

Martin Sorrell’s S4 Capital boosts revenue and profit

Sir Martin Sorrell’s digital agency S4 Capital increased both revenue and profit in the third quarter, it said today.

In a trading update for the three months to 30 September it said revenue was up almost 54 per cent to £56.6m and gross profit up 50 per cent to £42.1m.

Year-to-date revenue grew over 46 per cent to £144.6m and gross profit rose 46 per cent to £112.3m.

Read more: Traditional agency model is ‘not fit for purpose’

Revenue grew 48 per cent in the firm’s content practice to £41.1m with gross profit up almost 40 per cent to £26.6m.

In its programmatic practice, which automates the buying and selling of adverts, revenue grew 71 per cent to £15.6m and profit rose 71 per cent to £15.5m.

Net debt averaged £30m in the third quarter, up from approximately £20m in the first half.

The company said this reflected merger and asset purchase cash payments in the second and third quarters. 

Read more: Martin Sorrell labels tech firms ‘frenemies’ as he lays out vision for S4 Capital expansion

Sorrell, executive chairman of S4 Capital, said: “We continue to trade in line with ambitious internal and external expectations, both top and bottom line. Our very strong organic growth of well over 40 per cent, so far this year, indicates that clients are responding very well to our purely digital, unitary, ‘holy trinity’ model of first party data fueling digital content and programmatic.

As our new content and media partners, Firewood, based in Silicon Valley put it, ‘speed, quality and value’ are key. The mergers and asset purchase we have completed, so far this year, will broaden and deepen our capabilities and client relationships and convert clients to scale. 

“The peanut has morphed into a pumpkin in time for Halloween 2019 and we have also achieved US$ unicorn status.”