Interactive artificial intelligence digital advertisement in retail shopping centre
2024 target like-for-like net revenue is expected to be down on the prior year / Image source: Adobe
  • Shares down 77% over past year
  • Net revenue down 2.1% to £873.2 million
  • First share buyback completed in March

Shares in S4 Capital (SFOR) were down nearly 12% to 39p in morning trading despite full year results from the digital media group meeting downgraded expectations.

Headed up by former WPP boss Sir Martin Sorrell, S4 Capital reported a 2.1% fall in net revenue to £873.2 million for the year ending 31 December 2023 compared to £891.7 million in the same year ago period.

Revenue fell 4.5% on a like-for-like basis, which S4 Capital blamed on ‘challenging macroeconomic conditions’ as well as the ‘client caution’ which is likely to persist ‘despite the prospect of lower interest rates.’

2024 target like-for-like net revenue is expected to be down year-on-year with a broadly similar overall level of operational (earnings before interest taxation depreciation and amortisation) EBITDA.

Shares in the advertising group are down 77% over one year, pulled lower by profit warnings coughed up in July, September and November of last year.

It is not all doom and gloom however as S4 Capital, which completed its first share buyback programme in March, assured investors that ‘major client relationships remain resilient with Top 10,20, and 50 performing better than average’.

Does S4 Capital’s latest update signal a turnaround for the advertising group?


The company took the opportunity to announce a new chief operating officer and member of the executive committee in Jean-Benoit Berty, who joins from Ernst & Young, where he worked as a senior partner for 18 years.

Executive chairman Sorrell is hoping Berty’s appointment will progress the company’s strategy and focus on artificial intelligence (AI).


Liberum Capital, which has a ‘buy’ rating and 85p price target on S4, pointed out the advertising group’s full year 2023 performance was ‘consistent with recent guidance’.

The broker said: ‘Top client were resilient in 2023 despite the tough backdrop; full year 2024 outturn headcount was lower than estimates showing strong execution on efficiencies and second half (free cash flow) FCF recovery was stronger than forecast.

‘Outlook on revenues aligns closely with our forecasts, with management guiding to further revenue headwinds through full year 2024 (estimate) as client budgets remain depressed. Yet within this, higher-margin technology segment revenues are experiencing sizeable demand headwinds meaning group margins are likely to prove softer as a result.’


Find out how to deal online from £1.50 in a SIPP, ISA or Dealing account. AJ Bell logo

Issue Date: 27 Mar 2024