Pure-play digital advertising company S4 Capital posted strong results for the March quarter, with reported revenue up 71% to £122 million and like-for-like 35% higher.
Founder Martin Sorrell is “extremely optimistic” about the company’s prospects, with a strong chance of achieving the group's three-year plan of doubling organically.
S4 Capital will raise its like-for-like gross profit (net revenue) target to 30% from 25%.
Sir Martin plans to broaden and deepen content and data and digital services through acquisitions.
And S4, with 5,000 people in 31 countries, will get a unified brand, bringing together all its units.
On the sales side, S4 will focus on its 20 squared objective, to develop 20 clients with more than $US20 million of gross revenues, what Sir Martin calls “whoppers”.
“We are projecting five for 2021, Google, another FAANG (NDA), BMW/MINI, Mondēlez and Facebook,” he says.
“We believe we will be able to target a further three tech clients this year, which would total eight, of which six would be in tech and telecommunications.”
He says digital marketing spend remains robust, even in a recession.
Agility continues to be the S4’s corporate attribute and its go-to-market mantra faster, better, cheaper or speed, quality, value is resonating increasingly with our clients and potential ones.
He says the pandemic has accelerated digital transformation. The recovery in global GDP and the secular trend to digital marketing provide strong tailwinds.
“We are extremely optimistic about our prospects for this year and next, given the huge global fiscal and monetary stimulus introduced to counter the impact of the pandemic and the subsequent increase in consumer savings ratios and stagnation of corporate capital investment,” he says.
“The chickens may well come home to roost in 2023, given the debt burden that most countries will have and the tax increases that will have to be implemented.”
The numbers for the March quarter:
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