Member Info for CharlesMunger

Also read Live RNS today. 2 Directors sold some shares recently.

Moody’s cited S4 Capital’s declining revenue trajectory as tech clients pull back on sales and marketing spending amid economic uncertainty. The company has also experienced sustained margin compression despite implementing cost control initiatives.

S4 Capital reported an 11.9% like-for-like revenue decline to £360.4 million in the first half of 2025. Moody’s projects the company’s adjusted debt to EBITDA ratio will reach 5.4x for 2025.

Despite these challenges, Moody’s noted several positive factors, including S4 Capital’s position as a digital advertising pure-play with a full suite of marketing and technology services, established client relationships, and recent client wins including General Motors Company, Amazon.com, Inc., T-Mobile USA, Inc., and a US-based FMCG company.

The company maintains a good liquidity position with £175.1 million in cash and cash equivalents as of June 2025 and access to a fully undrawn £100 million committed backed senior secured revolving credit facility. S4 Capital faces no significant debt maturities before 2026.

The stable outlook reflects Moody’s expectation that recent contract wins will improve performance and that S4 Capital will prevent further material client losses. It also acknowledges the company’s focus on operational cost cutting, pause in acquisition activity, and efforts to preserve liquidity.

Moody’s indicated the rating could be upgraded if S4 Capital builds a track record of client wins that diversify its client base and support sustained revenue and EBITDA growth, while maintaining adjusted gross debt/EBITDA well below 4.5x with positive free cash flow generation.

Conversely, the rating could face further downgrade if the company fails to return to healthy organic revenue growth from the second half of 2025, cannot preserve and improve its EBITDA margin, or if its adjusted gross debt/EBITDA remains above 5.5x.

Https://www.ft.com/content/d30ff526-82f2-44ca-9c7d-357a8984e03a

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https://www.ft.com/content/d30ff526-82f2-44ca-9c7d-357a8984e03a

HOLD: S4 Capital (SFOR)

Some investors are running out of patience with S4 Capital (SFOR). Shares in Martin Sorrell’s digital marketing agency sank to a fresh low after it cut its revenue guidance yet again. Sales are now expected to fall by the mid-single digits this year, compared with earlier guidance of a low-single-digit drop. Keeping the target for flat earnings before interest, tax, depreciation and amortisation was little consolation.

Pressures are spread across the business. The company generates almost half of its revenue from tech clients, which are curbing marketing spending to plough cash into artificial intelligence projects. That means longer sales cycles and tighter spending.

First-half numbers showed the scale of the challenge. Net revenue in technology services fell 35 per cent on a like-for-like basis, while marketing services revenue dropped 6.3 per cent. The Americas, which accounts for nearly 80 per cent of total net revenue, was down 9.1 per cent. On a brighter note, cash generation was strong. Free cash flow rose from £3.1mn a year earlier to £16mn

Https://www.cnbc.com/2025/06/15/how-ai-is-disrupting-the-advertising-industry.html

Https://uk.investing.com/news/stock-market-news/meta-to-offer-fully-aibased-ad-creation-and-publishing-by-end-of-2026-93CH-4114470

Https://www.bandt.com.au/curtin-university-appoints-s4-capitals-monks-to-boost-digital-experiences/

Deutsche Bank Research cuts S4 Capital price target to 32 (37) pence - 'hold'

Come on! Really???

Captain hindsight strikes again!

Yesterday, after 8% gain - may see a quick rise towards 31p and it may remain there for a while.

Today, after 5% drop - back to bankruptcy again

Do you really expect anyone to take you serious mate?

Https://www.cnbc.com/2025/05/16/chinese-companies-like-alibaba-see-more-consumption-helped-by-ai-ads.html

Deutsche Bank Research cuts S4 Capital price target to 32 (37) pence - 'hold'

Deutsche Bank Research cuts S4 Capital price target to 37 (42) pence - 'hold'

S4 Capital vs M&C Saatchi

S4 Market cap 216 mil

M&C Market cap 202 mil

S4 Billings 2024 1963.0 mil

M&C Billings 2024 610.1 mil

S4 Net revenue 2024 754.6 mil -11.0% like for like 2023

M&C Net revenue 2024 231.0 mil + 3.7% like for like 2023

S4 Operating profit 78.3 mil -4.5%

M&C Operating profit 35.2 mil +5.2%

S4 Profit margin 11.6% +0.9%

M&C Profit margin 15.2% +0.2%

S4 Adjusted EPS 5.2p 4.4p

M&C EPS 17.6p 16.6p +6.1%

S4 Dividend 1p 0p +100%

M&C Dividend 1.95p 1.6p +21.9%

S4 7150 monks

M&C 2700 collegues

S4 Current liabilities (504.0)

M&C Current liabilities (138.8)

Revenue by region:

S4 16.35% EMEA 5.74% APAC 77.91% Americas

M&C 47.23% UK +5.3% Europe 23.33% APAC 19.13% Americas

S4 USA oriented business, M&C UK oriented.

M&C 2024

· Business wins, totalling over 140 in 2024, including

Ferrari, Carlsberg, L'Oreal, Allwyn in H2

following the H1 wins of McDonalds, Ford, Danone, MTN, IKEA and Sony Pictures

CLIENTS: NHS, Grab, LIDL, LEGO, Porsche, The North Face, Adidas, Carlsberg,

William Grant&Sons, Allwyn, Tesco, AC Milan, New Zealand Rugby - All Blacks,

Commonwealth bank, Amazon, JPMorgan Chase, betfair, WHO, Barclays, Heineken,

Nestle, Toyota, Pepsico, NIKE, NATO, Costa coffee, Coca Cola, SEGA, International

Olympic Committee,

S4 2024

New business wins during the year include General Motors, Qiddiya, Marriott,

Burger King, Panasonic, FanDuel, AliExpress, Decathlon, Santander, SC Johnson,

ICBC, Asana, CashApp, Shopify, Coursera and Singapore Sports Hub

Reading M&C Saatchi FY Reasults 2024, investment case, investment presentation -

NOT ONE MENTION OF AI!!!

Listen to S4Capital annual report 2024, investment presentation, check out

Monks instagram account, listen to any Sir Martin Sorell interview, it is

all about S4Capital/Monks AI superiority, dominance, digital only...

Numbers speak for themselfs.

Why is S4 superior business to M&C Saatchi, or any other AD business?

Why is S4 killer of traditional holding agencies with bright future,

while M&C Saatchi is just UK micro cap business no one gives a F**K?

!DISCLAIMER!

I DO NOT own any M&C Saatchi shares (wish I did!).

I DO OWN S4Capital shares, investor since 2020.

Analysts at Peel Hunt, which maintained a hold rating on S4 shares with a target price of 40p, said the group 'has made progress with cost control, and margins remained resilient despite the revenue decline'.

They added: 'However, we believe a more supportive industry backdrop and stronger growth are needed for the shares to gain momentum.'

How sustainable is 1p dividend?

Do you expect S4C to pay interim dividend as well in the future?

No buyback :(

SMS expects 2025 to be similar to 2024.

Don't expect any significant improvement guys.

At least share price should stabilise here .

2 days ago mate, go check Live RNS!!!

Slowly but surely, the company is going in the right direction. Finally!!! Share price will follow. All we need is good H1 + reassuring H2 results. After that share price will recover. One good quarterly results won't do much.