LONDON, May 4 (Reuters) - Martin Sorrell's S4 Capital
raised its annual revenue and gross profit targets on
Tuesday after the pandemic forced customers to invest more in
digital advertising, helping to create demand not seen since the
The British ad executive said client wins from BMW and
Mondelez had driven income in March, meaning it would now target
30% organic revenue and gross profit growth for the year, up
from 25% previously.
Sorrell, who built the world's largest advertising group WPP
before he left in 2018 and set up the purely digital S4,
said the company was benefiting from the rapid shift to digital
services that had accelerated during COVID-19.
Major client wins from the likes of Google, Facebook, BMW
and Mondelez meant gross profit rose by 33% on an organic basis
in the first quarter, meaning it should hit its three-year
target of doubling organically.
"We haven't seen this level of activity in the pipeline in
many, many years, if ever," Sorrell told Reuters. "It's strong.
April looks like it will be huge."
S4 said it was prepared to leverage the group to around 2
times core earnings and is preparing a bond issue of around 250
million pounds to increase its firepower for acquisitions.
It also announced the acquisition of Brazilian agency
Raccoon, which provides digital search and data analytics.
Shares in the company were trading up 3% in early deals.
(Reporting by Kate Holton; editing by Sarah Young and Paul