Martin Sorrell’s digital advertising play S4 Capital managed to grow revenue in the depths of the economic fallout from the coronavirus crisis.
In a trading update, the company says like-for-like gross profit grew more than 3% in April at the height of the COVID-19 lockdowns.
May was up almost 5% and the company believes April will be the trough month for 2020 with performance increasing in June and through the second half.
The company is confident of delivering double digit like-for-like revenue and gross profit growth for 2020.
S4 says it has strong new business activity with two major pitches, both of which would be more than 5% of the company’s revenue if won.
The company also announced a £100 million (AUD180 million) capital raising, preparing to grow via acquisitions or, as the company calls them, mergers. Sir Martin is putting in £8 million through a family investment company.
The cash will give the company what it calls “firepower”. So far the company has acquired 13 businesses. This capital raising will enable bigger transactions.
Last month S4 Capital added Lens10, a leading Australian digital strategy and analytics consultancy, to its content capabilities. The business will be merged with MightyHive, Sorrell's vehicle of choice for data analytics.
“In line with our mantra of ‘faster, better, cheaper’, now is not the time to slow down,” says Sir Martin.
“We believe that it is precisely the time to quicken the development of our capabilities around digital transformation, accelerated by the pandemic.
“We have a great team in place, as good as I have seen anywhere, eager to create new and exciting ideas for our clients. We, therefore, want to ensure that the company has the necessary flexibility to capitalise on opportunities as they arise.”
Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at adnews@yaffa.com.au
Sign up to the AdNews newsletter, like us on Facebook or follow us on Twitter for breaking stories and campaigns throughout the day.