Strife in the ad markets continues to blight Sir Martin Sorrell's S4 Capital with 1st quarter revenues down near 15%. He blames "volatile global macroeconomic conditions," and client caution among big tech firms.
Revenues fell from £261 million a year ago to £210 million for the three months to March.
The former WPP man said: “We continue to develop our larger, scaled relationships with leading enterprise clients and are increasing our focus on margin improvement through greater efficiency, utilisation, billability and pricing.” Yesterday ITV noted some improvement in the ad market and hoped this summer’s Euro football championships would see that trend continue.
S4 is more reliant on big tech giants that have lately been less optimistic.
Sir Martin thinks an AI boom is coming.
Shares in the company jumped on Friday morning despite the tentative update. The stock rose 8p to 54p, though they are down 60% in the last year.
The company has worked on campaigns for brands including Google, Meta and BMW through its content division Media.Monks, which Sir Martin said had started to improve in recent months.
S4 Capital axed its workforce by about 13% last year to save costs in the face of a tough market and rising wage bills.
This move was starting to have a beneficial impact on its cost base and profitability, the group said.
Furthermore, the firm revealed it had won new work over the first quarter with brands including Burger King, Panasonic and Santander.
Liberum said S$ has “stabilised” its decline and thinks the shares are a buy.
