S4 Capital revenue rises after bumper BMW account win
S4 Capital has posted a double-digit rise in revenue and profit for the third quarter after it secured a lucrative new account from BMW and Mini.
Sir Martin Sorrell’s advertising firm booked revenue of £86.4m in the three months to the end of September, up 13 per cent on the same period last year. Gross profit rose 23 per cent to £75.3m.
The growth marked an improvement on S4’s performance in the first half of the year as client confidence began to return after the initial outbreak of Covid-19.
Billings rose almost 13 per cent over the quarter to hit £163.1m over the quarter, and the company said it was now more in line with its target of doubling organically over three years.
S4 has continued its strategy of aggressive expansion, announcing four mergers or acquisitions over the quarter, including French agency Dare.Win and Amazon agency Orca Pacific.
Meanwhile, the company’s Media Monks division secured a major contract win for the newly-merged BMW and Mini European content and production account.
The win forms a key part of Sorrell’s target of landing 20 clients with revenue of more than $20m per year, which he dubs “whoppers”.
BMW will join Google and a third undisclosed client on S4’s roster of “whoppers”, with talks underway over securing a fourth.
Other client wins over the quarter included T-Mobile, Klarna, Shopify and Beyond Meat.
“We continue to trade in line with ambitious internal and external targets, which now include doubling both top and bottom lines organically over the period 2021 to 2023,” said executive chairman Sorrell.
“Our consistent, very strong organic gross profit growth indicates that we are well positioned in the digital sweetspot of an otherwise stagnant advertising and marketing industry and that clients are responding very well to our new age/new era, purely digital, ‘holy trinity’ model of first party data fueling digital content, data and digital media.”
S4, which has now secured a market capitalisation of more than £2bn, has grown rapidly since its inception two years ago.
Sorrell remained bullish about the company’s outlook and said it would continue to explore further acquisitions in 2021.