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(Alliance News) - S4 Capital PLC on Wednesday said it expects to hit full-year targets, on the back of a strong fourth quarter.
The London-based advertising agency said trading in the fourth quarter of 2022 was in line with expectations and therefore it expects to deliver operational earnings before interest, tax, depreciation and amortisation of at least GBP120 million for 2022.
S4 explained that it had "significantly improved" operational Ebitda margin performance in the second half with like-for-like gross profit and revenue growth also in line with 25% guidance.
In 2021, S4 reported revenue of GBP686.6 million, gross profit of GBP560.3 million, and operational Ebitda of GBP101.1 million.
It added that as a result of improved liquidity, net debt is expected to be well towards the lower end of the guided range of between GBP130 million and GBP170 million.
The company significantly improved operational Ebitda margin performance in the second half with like-for-like gross profit against net revenue growth also in line with 25% guidance. As a result of improved liquidity, net debt is expected to be well towards the lower end of the guided range of £130-170 million.
S4 Capital expects to announce 2022 results by March 30. It plans to provide a full outlook for 2023 then.
Executive Chair Martin Sorrell said: "Most market commentators are now projecting high single digit growth for digital advertising and high teens percentage growth for digital transformation, which we believe we can continue to outpace, given our addressable markets including Technology services and as we build further momentum with our clients. Their priorities for 2023 seem to be focussed on driving revenue growth through "lower funnel" performance and activation and reducing cost through digital marketing transformation."
Shares in S4 Capital were up 1.4% to 221.43 pence each in London on Wednesday around midday.
By Sophie Rose, Alliance News reporter
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