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S4 says 2018 results show 'new era' model is growing stronger

The firm posted £59.1 million in billings and an operating loss of £8.5m.

S4 Capital has released its full-year 2018 results, which it claims shows that its ‘new era’ digital marketing model is generating strong growth.

The firm posted £59.1 million in billings, while its pro-forma billings stood at £291.2m to reflect the numbers for consolidated results of MediaMonks and MightyHive, together with S4 Capital, if the group had existed in full for the year.

S4 purchased MediaMonks in July 2018 for £56.4m equity and £205.4m cash, and bought MightyHive on Christmas Eve for £43.6m equity and £71.9m cash.

Its full-year 2018 revenue was recorded at £54.8m and pro-forma revenue at £135.9m, up 58% in 2017, while gross profit stood at £37.2m and pro-forma gross profit £105.2m, up 49% on 2017.

“The company’s purely digital model based on first-party data fuelling digital content and programmatic is resonating with clients. Our tag line “faster, better, cheaper” and unitary, one P&L structure also appeal strongly,” said Sir Martin Sorrell, the executive chairman of S4.

S4’s operational earnings before interest, tax, depreciation and amortization (EBITDA) was £4.7m, while its pro-forma operational EBITDA was £22.4m, up 99% on 2017.

Overall, it posted an operating loss of £8.5m, which includes adjusting items of £12.5m, and pro-forma adjusted operating profit of £21.0 million.

“The imperatives will be to broaden and deepen relationships with existing and new clients; to broaden and deepen geographical coverage; and to attract additional data, content and media talent and resources through direct recruitment, acquisition and/or merger," added Sorrell.

MediaMonks chief executive (or main monk) Victor Knaap previously revealed to The Drum that S4's new office in Singapore will house the two businesses, as well as S4 exec Michel De Rijk and a new content studio, which will offer brands a scalable alternative to in-housing content creative.

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