International: Sir Martin Sorrell’s S4Capital, the new age digital advertising and marketing services company, reported revenue up 71% to £122 million, up 35% like-for-like and 35% pro-forma for the three months ending 31 March 2021.
The Company grew strongly in the first quarter, showing an acceleration in the like-for-like gross profit (net revenue) growth rate from 27% in the fourth quarter of 2020 to 33% and compared to 19% in the pandemic-affected first quarter last year.
The Group’s Content practice, representing 72% of the total gross profit (net revenue), was up 64% in reported revenues and 62% in gross profit (net revenue), up 35% and 31% like-for-like and the same pro-forma.
The Group’s Data and digital media practice, representing 28% of the total gross profit (net revenue), was up 100% in reported revenues and 101% in reported gross profit, up 35% and 36% like-for-like same pro-forma.
Geographically, all regions showed strong growth. The Americas, representing 70% of the reported gross profit (net revenue), reported a gross profit (net revenue) up 63%, EMEA, representing 21%, up 97%, and the Asia Pacific, representing the remaining 9% up 95%. On a like-for-like basis, the Americas were up 30%, EMEA up 44% and the Asia Pacific up 34%. On a pro-forma basis, all the regions grew at the same levels as like-for-like.
The Cash flow and balance sheet remain strong with average net cash of around £50 million for the first quarter, after significant merger payments since the equity fundraising in July 2020. The Quarter also witnessed a strong rebound in global GDP growth in 2021, and 2022 will drive 20% per annum growth in digital advertising as the pandemic accelerates digital transformation.
The Company will now target an even stronger sector-leading 30% like-for-like revenue and gross profit growth (up from 25% previously) and strong operating EBITDA margin in 2021