RNS14 Nov 2018 09:10
14 November 2018
S4 Capital plc
Third Quarter Trading Update
Continued strong growth
S4 Capital plc (SFOR.L), the new era digital advertising and marketing services company, provides the following trading update for the three-month period ending 30 September 2018. This is the first trading update following the injection of S4 Capital into Derriston plc on 28 September 2018 and the renaming of the Company as S4 Capital plc.
The Group delivered a very strong third quarter performance in line with expectations, with revenue up almost 45% to €29.3 million (£26.2 million) and gross profit up almost 32% to €20.4 million (£18.3 million). Like-for-like (ex-acquisitions and in constant currency) revenue and gross profit were up almost 46% and almost 33% respectively.
Year to date, revenue is up over 48% to €83.4 million (£73.8 million) and gross profit up almost 40% to €59.7 million (£52.8 million). Like-for-like revenue and gross profit were up over 54% and over 45% respectively.
The earnings before interest, depreciation and amortisation (EBITDA) operating gross profit margin at MediaMonks was steady at over 20% in the third quarter versus the third quarter last year, and up to 25% in the first nine months from 15% in the same period last year. Like-for-like EBITDA operating gross profit margins were similar for the same periods.
MediaMonks, currently S4 Capital's main trading company, divides its business into three component parts or pillars: creative content & innovation, assets at scale, and platforms and e-commerce. The creative content & innovation pillar offers clients premium content and cutting-edge Virtual Reality ('VR'), Augmented Reality ('AR') and experiential projects and has performed solidly, according to plan.
Assets at scale, which focuses on asset production across programmatic advertising, precision marketing, content production and the localisation and adaptation of global campaign rollouts, doubled its gross and net revenues in the third quarter and year to date compared to the same periods in 2017. This performance reflects the growth seen in global digital advertising, which is forecast by Strategic Analytics to reach $51 billion by 2023, with a 19.5% share of worldwide video spending, compared to $30 billion and a 13.3% share currently.
Platforms and e-commerce, which focuses on the development of websites, applications and other internal e-commerce platforms primarily for multi-national clients, grew strongly in both the third quarter and year to date.
Geographically, the United States showed very strong growth in the third quarter and year to date. An office in San Francisco has been added in the fourth quarter to the two main United States offices in New York and Los Angeles, to further service the Group's growing technology client portfolio. Europe (including Central and Eastern Europe) also grew significantly in the third quarter and year to date, with the United Kingdom pa
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