REG - S4 Capital PLC - Interim Results for 2025
Today 07:00
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RNS Number : 3058Z S4 Capital PLC 15 September 2025
S(4)Capital plc
("S(4)Capital" or "the Company" or "the Group")
Interim Results for 2025
Net revenue(2) for six months to June 30 down 12.7% on a reported basis, down
10.0% like-for-like(3 )
Operational EBITDA(5) £20.8 million, as expected down almost 31% on a
reported basis, down approximately 30% like-for-like
Net debt(7) at £145.9 million, improving £37 million from £182.9 million 30
June 2024, reflecting strong cashflow management
Full year like-for-like(3) 2025 net revenue growth rate expected to be down by
mid-single digits
Marketing Services net revenue expected to be down low single digits
reflecting the timing of significant new business wins, particularly General
Motors, Amazon, T-Mobile and a leading US-based FMCG
Technology Services expected to be down more due to longer sales cycles and
still reflecting the revenue reduction by a major client, although this will
cycle out in the second half of the year
Full year like-for-like(3) 2025 operational EBITDA target remains unchanged,
broadly similar to 2024, with a greater second half weighting, reflecting the
timing of significant new business wins and further cost reduction, which is
being actioned.
Our targeted range for year-end net debt remains at £100 million to £140
million.
The Board will consider approving an enhanced final dividend for 2025, if the
improved second half performance and liquidity targets are delivered
£ millions six months ended six months ended change Reported change change
Like-for-like(3)
Pro-forma(4)
30 June 2025 30 June 2024
Billings(1) 925.9 908.9 1.9% 5.1% 5.1%
Revenue 360.4 422.5 (14.7%) (11.9%) (11.9%)
Net revenue(2) 328.2 376.1 (12.7%) (10.0%) (10.0%)
Operational EBITDA(5) 20.8 30.1 (30.9%) (30.4%) (30.4%)
Operational EBITDA margin(5) 6.3% 8.0% (170bps) (190bps) (190bps)
Adjusted operating profit(6) 16.4 24.8 (33.9%)
Adjusting items(6) (27.3) (28.5) 4.2%
Operating loss (10.9) (3.7) (194.6%)
Loss for period (22.3) (13.7) (62.8%)
Basic loss per share (pence) (3.3) (2.0) (1.3)
Adjusted basic earnings per share(6) (pence) 0.2 1.2 (1.0)
Number of Monks 6,879 7,553 8.9%
Free cash flow 16.0 3.1 12.9
Net debt(7) (145.9) (182.9) 37.0
Financial highlights
/ Billings £925.9 million, up 1.9% on a reported basis and up 5.1%
like-for-like.
/ Revenue £360.4 million, down 14.7% reported and down 11.9%
like-for-like.
/ Net revenue £328.2 million, down 12.7% reported and down 10.0%
like-for-like, reflecting the continuing impact of volatile global
macroeconomic conditions and more recently uncertainty surrounding eventual
tariff levels. Clients remain generally cautious given this uncertainty, with
technology clients in particular, which account for almost half our revenue,
continuing to prioritise capital expenditure on expanding AI capacity.
Technology Services faced longer sales cycles and continues to be affected by
a reduction in one of our larger relationships, although this will cycle out
in the second half of the year.
/ Operational EBITDA was in line with expectations at £20.8 million, down
30.9% reported and down 30.4% like-for-like. Costs continued to be tightly
controlled and the number of Monks at 30 June 2025 was down 4.0% versus
December 2024 and down 8.9% versus 30 June 2024.
/ Operating loss of £10.9 million, an increase of £7.2 million on the
reported prior year loss.
/ Adjusted basic earnings per share 0.2p per share excluding adjusting
items after tax, compared to 1.2p per share last year, a decrease of 83.3%.
/ Basic loss per share of 3.3p, compared to 2.0p basic loss per share in
the first half of 2024.
/ The Company generated free cash flow of £16.0 million, an increase of
£12.9 million compared to H1 2024.
/ Net debt(7) ended the period at £145.9 million, compared to £182.9
million at June 30 2024, or 2.0x net debt/pro-forma 12 month operational
EBITDA driven by £19.2 million working capital inflow during the period
reflecting ongoing focus on working capital management. Our targeted range for
year-end net debt remains at £100 million to £140 million.
/ The balance sheet has sufficient liquidity with the maturity of the
€375 million term loan in August 2028 and the currently undrawn £100
million RCF in August 2026. There is headroom against the key covenant, that
net debt will not exceed 4.5x the pro-forma operational EBITDA(9).
Strategic and operational highlights
/ The strategy of S(4)Capital remains the same. The Company's unitary,
purely digital transformation model, based on first-party data fuelling the
creation, production and distribution of digital advertising content,
distributed by digital media and built on technology platforms to ensure
success and efficiency, resonates with clients.
/ We have rebranded to Monks and are focusing all our current capabilities
in two Practices: Marketing Services and Technology Services. Our tagline
'faster, better, cheaper and more' or 'speed, quality, value and more' and a
unitary structure both appeal strongly, even more so in challenging economic
times.
/ We remain confident in our strategy, business model and talent. These
together with scaled client relationships position us well for sustained
growth in the longer term, with an emphasis on deploying free cash flow, as
and when appropriate, to improve shareowner returns, particularly now that all
significant merger payments have been made. Following shareowner approval at
the AGM the Company paid a first time final dividend of 1 pence per share on
the 10th July, amounting to £6.1 million. As previously, the Board is not
proposing an interim dividend and will consider approving an enhanced final
dividend for 2025, if the improved second half performance and liquidity
targets are delivered. As net debt is reduced and falls below £100 million,
our capital allocation policy will return cash to shareowners through a
mixture of dividends and share buybacks.
/ We are seeing our AI initiatives improve visualisation and copywriting
productivity, deliver considerably more effective and economic
hyper-personalisation (better targeted content at greater scale), delivering
more automated and integrated media planning and buying, improving general
client and agency efficiency and democratise knowledge. Monks.Flow is our AI
product solution that automates marketing workflows and we are continuing to
add applications and expand its capabilities. Our end-to-end suite of
Monks.Flow products orchestrates and helps enable our clients to more easily
implement AI solutions, particularly in visualisation and copywriting, in
hyper-personalisation at scale, in real time focus groups and linking media
planning and buying. We are now producing high quality commercials using AI
technologies such as Runway, Flux, Omniverse (Nvidia), Substance (Adobe) and
Unreal that literally take hours and days to produce at significantly lower
cost rather than traditional production techniques, which take weeks and
months at significantly greater cost. The quality continues to improve in
real time and clients that are exposed to the results of these AI technologies
are very excited about their implementation and the commercial impact on their
marketing budgets and return on investment. As a result, we are now changing
our revenue model from a purely, time-based approach to one more based on
outputs - i.e. use of assets.
/ Trading in the first half of the year reflects the continuing impact of
volatile global macroeconomic conditions, together with the additional
uncertainty around tariffs and their ultimate levels. As a result, clients
remain generally cautious given the uncertainty, with technology clients, in
particular, which account for almost half our revenue, continuing to
prioritise capital expenditure on expanding AI capacity.
/ We are seeing significant opportunities for new business, particularly
driven by our AI tools and capability. New business wins so far this year
include new or broadened relationships with Asana, Amplifon, Samsung, Square,
NCS and Opella. We also continue to expand many of our existing relationships,
in particular General Motors and Amazon, which will ramp up significantly in
the second half of the year. In April, we won a large "Real Time Brands"
assignment with our existing client T-Mobile. In July we were engaged by a
leading US-based FMCG, as their Content Studio Agency Partner, which draws on
both our "Real Time Brands" and "Orchestration Partner" propositions with a
focus on quality creative combined with dimension and cultural relevancy,
beyond simply making assets at scale. Both of these new wins will contribute
to our second-half performance and over time are expected to be significant
relationships for us. We continue to win multiple exploratory assignments, as
clients experiment and explore AI applications and develop AI use cases. AI
capability is becoming more central to the agency's way of working and new
business efforts. In this regard the Company's early adoption of AI and
proactive approach to staff training on AI is beginning to pay off.
/ Our new Go-To-Market propositions, Orchestration Partner, Real Time
Brands, Glass Box Media and Digital Transformation are all starting to
resonate strongly with clients. These are built around hyper-personalisation
at scale, social media, brand strategy, transparent media buying and planning
and the leveraging of technology.
/ The Company has reduced the number of Monks to circa 6,900, down 9%
compared to circa 7,600 as at June 2024 and 4% lower than the December 2024
number of circa 7,150.
/ We maintain a disciplined approach to managing our cost base and have
commenced a further significant cost reduction plan in the second half of 2025
to bring our staff cost to revenue ratio from 76% to be more in line with the
industry average of 65%.
Outlook
/ As a result of the continued wider market uncertainty and significant
volatility in global economic policy, particularly the US-imposed tariffs,
full year like-for-like net revenue is now expected to be down by mid-single
digits. Marketing Services is forecast to be down by low single digits, and
although Technology Services is forecast to be down more due to longer sales
cycles and still reflecting the revenue reduction by a major client, although
this will cycle out in the second half of this year.
/ We expect an improved performance in the second half of the year with a
greater second half weighting than in the prior year, enhanced by the impact
of new business revenue, including wins already secured and further
incremental cost reduction which is being actioned.
/ We continue to target like-for-like operational EBITDA(8) to be broadly
similar to 2024.
/ Our targeted range for the year end net debt remains £100 million to
£140 million. We target medium term financial leverage at the lower end of
our previous range of around 1.5 times operational EBITDA. Over the longer
term we continue to expect our growth to outperform our markets and
operational EBITDA margins to return to historic levels of around 20%(8).
Sir Martin Sorrell, Executive Chairman of S(4)Capital plc said:
"Market conditions in the first half of 2025 reflect the continuing impact of,
to say the least, volatile global macroeconomic conditions along with the
unsettling effect of tariff negotiations. As a result, clients remain
generally cautious given the uncertainty, with technology clients, which
account for almost half our revenue, in particular, continuing to prioritise
capital expenditure on expanding AI capacity. Our Technology Services
Practice faced longer sales cycles and continued to be affected by a reduction
in one of our larger relationships, although this will cycle out in the second
half of the year. Our liquidity and cashflow continued to be much improved
compared with the first half of 2024 and month-end average net debt was down
almost 27% by £52 million, from £196 million to £144 million, despite the
first half, as usual, seeing lower seasonal levels of activity and reflecting
our ongoing focus on working capital and cost control.
With that said, we expect an improved net revenue performance in the second
half of the year, aided by the phasing of revenue from new business,
particularly from General Motors, Amazon, T-mobile and a leading US-based FMCG
and seasonality.
We maintain our operational EBITDA and net debt guidance reflecting continued
cost control and cash management. Liquidity is also forecast to improve, which
will give us the ability to consider an enhanced final dividend once the
results for 2025 are announced.
The global macroeconomic environment has become even more challenging in 2025.
Assessing the impact of US imposed tariffs has been added to the three key
risks around US/China relations, Russia/Ukraine and Iran/Middle-East. Clients,
therefore, are likely to remain cautious. However, once the levels of tariffs
are negotiated and the impacts assessed, we believe clients will become much
more selective about the geographies in which they operate in order to find
growth and focus on implementing technologies, such as, but not only AI, to
drive efficiency in a slower growth, higher inflation and higher interest rate
environment. This may be the time when AI-adoption accelerates at scale.
"
Notes:
1. Billings is gross billings to clients including pass through costs.
2. Net revenue is revenue less direct costs.
3. Like-for-like is a non-GAAP measure and relates to 2024 being restated
to show the audited numbers for the previous year of the existing and acquired
businesses consolidated for the same months as in 2025 applying currency rates
as used in 2025.
4. Pro-forma numbers relate to audited non-statutory and non-GAAP
consolidated results in constant currency as if the Group had existed in full
for the period and have been prepared under comparable GAAP with no
consolidation eliminations in the pre-acquisition period.
5. Operational EBITDA is operating profit or loss adjusted for acquisition
related expenses, non-recurring items (primarily acquisition payments tied to
continued employment, amortisation and impairment of business combination
intangible assets and restructuring and other one-off expenses) and recurring
items (share-based payments) and includes right-of-use assets depreciation. It
is a non-GAAP measure management uses to assess the underlying business
performance. Operational EBITDA margin is operational EBITDA as a percentage
of net revenue.
6. Adjusted figures are adjusted for non-recurring and recurring items as
defined above in note 5.
7. Net debt excludes lease liabilities.
8. This is a target and not a profit forecast.
9. Net debt/pro-forma operational EBITDA as defined per the facilities
agreement.
10. Comparative information for the prior period has been represented to
reflect the Group's revised segment structure.
Disclaimer
This announcement includes 'forward-looking statements'. All statements other
than statements of historical facts included in this announcement, including,
without limitation, those regarding the Company's financial position, business
strategy, plans and objectives of management for future operations (including
development plans and objectives relating to the Company's services) are
forward-looking statements.
Forward-looking statements are subject to risks and uncertainties and
accordingly the Company's actual future financial results and operational
performance may differ materially from the results and performance expressed
in, or implied by, the statements. These factors include but are not limited
to those described in the Company's prospectus dated 8 October 2019 which is
available on the news section of the Company's website. These forward-looking
statements speak only as at the date of this announcement. S(4)Capital
expressly disclaims any obligation or undertaking to update or revise any
forward-looking statements contained herein to reflect actual results or any
change in the assumptions, conditions or circumstances on which any such
statements are based unless required to do so.
No statement in this announcement is intended to be a profit forecast and no
statement in this announcement should be interpreted to mean that earnings per
share of the Company for the current or future years would necessarily match
or exceed the historical published earnings per share of the Company.
Neither the content of the Company's website, nor the content on any website
accessible from hyperlinks on its website for any other website, is
incorporated into, or forms part of, this announcement nor, unless previously
published by means of a recognised information service, should any such
content be relied upon in reaching a decision as to whether or not to acquire,
continue to hold, or dispose of, shares in the Company.
Results webcast and conference call
A webcast and conference call covering the results will be held today at 09:00
GMT, followed by another webcast and call at 08:00 EST/ 13:00 GMT. Both
webcasts of the presentation will be available at www.s4capital.com
(https://url.avanan.click/v2/r02/___http:/www.s4capital.com___.YXAxZTpzNGNhcGl0YWw6YTpvOjBhZDFiYzk5OGM4NWEzYTkwOWRlYjM5ZTE2NjVjZGU3Ojc6YmQ4YzpmN2I3NmEzN2Y2NDBiMzkwYzljMmJkOTA4M2MxMmI0MzRlNWNiZTcwNmEzZWRhM2VjODNmYWQ2ZmI4ZGI5M2RmOnA6VDpO)
during the event.
09:00 BST webcast (watch only) and conference call (for Q&A):
Webcast:
https://brrmedia.news/SFOR_HY25 (https://brrmedia.news/SFOR_HY25)
Conference call:
UK: +44 (0) 33 0551 0200
US: +1 786 697 3501
08:00 EDT/13:00 BST webcast (watch only) and conference call (for Q&A):
Webcast:
https://brrmedia.news/SFOR_HY25_US (https://url.avanan.click/v2/r02/___https:/brrmedia.news/SFOR_HY25_US___.YXAxZTpzNGNhcGl0YWw6YTpvOjM0OTkxZWRiNjBjZjE3NmM3NmI2ZGMyOWJkNmNhODJiOjc6MjBmNTo0MTRiMmE3OTc2NzFmYTkzZDJhZjg3NThiODI1NDU4NDE1OGQ1NTJkMTVjY2VlNGEzMGVjYjAzZDMyYWY1ZWY5OnA6VDpO)
Conference call:
UK: +44 (0) 33 0551 0200
US: +1 786 697 3501
Enquiries to
S(4)Capital
plc
Sir Martin Sorrell, Executive Chairman
+44 (0)20 3793 0003/+44 (0)20 3793 0007
Radhika Radhakrishnan, Chief Financial Officer
Scott Spirit, Chief Growth Officer
Sodali & Co (PR Advisor)
Elly Williamson
+44 (0)7970 246
725
Interim results statement overview
As previously highlighted, trading in the first half of the year reflects the
continuing impact of volatile global macroeconomic conditions. As a result,
clients remain generally cautious given the uncertainty, with technology
clients, in particular, which account for almost half our revenue, continuing
to prioritise capital expenditure on expanding AI capacity. As anticipated,
our Technology Services Practice faced longer sales cycles and continued to be
affected by a reduction in one of our larger relationships, although this will
cycle out in the second half of the year.
Reported billings were £925.9 million, up 1.9% and up 5.1% like-for-like,
reflecting stronger digital media planning and buying activity. Revenue was
down 14.7% on a reported basis to £360.4 million, down 11.9% like-for-like.
Reported net revenue declined 12.7%, or 10.0% like-for-like.
The Company's proportion of revenue from technology clients decreased slightly
to 42% in 2025 from 44% in the first half of 2024.
Operational EBITDA in the first half of the year reflects the lower revenue in
both Marketing Services and Technology Services. We continue to maintain a
disciplined and active approach to cost management, including the number of
Monks and discretionary costs. The number of Monks at the end of June 2025 was
circa 6,900 down 9% from circa 7,600 at this time last year.
Performance by Practice
The Company now reports in two Practices: Marketing Services(10) and
Technology Services.
2025 net revenue in the first half of 2025 for the Marketing Services Practice
was down 6.4% like-for-like and Technology Services down 35.3% like-for-like.
Marketing Services' net revenue declined in the period reflecting ongoing
caution and lower activity with some of our larger technology clients.
Marketing Services' operational EBITDA was £28.5 million (H1 2024: £33.9
million), down 14.2% like-for-like and on a reported basis down 15.9% versus
H1 2024. Marketing Services' operational EBITDA margin was 9.5%, down 90
basis points like-for-like and down 80 basis points reported compared to 10.3%
in H1 2024.
Technology Services' performance was impacted by client negotiation delays and
the anticipated lower revenue from one key client, as well as longer sales
cycles for new business reflecting the challenging ongoing macroeconomic
conditions. Reported operational EBITDA was down to £2.6 million (H1 2024:
£5.7 million) and operational EBITDA margin was 8.9%, compared to 12.4% in H1
2024 due to the lower revenues.
The Company initiated a cost restructuring programme in the second half of the
year to offset and mitigate revenue challenges caused by the continuing impact
of volatile global macroeconomic conditions and general client cautiousness,
which will result in further incremental cost reductions to support margins in
the second half and bring the staff cost to revenue ratio more in line with
the industry average of 65%.
Performance by geography
On a like-for-like basis, the Americas net revenue was down 9.1%, but with
stronger growth in Latin America. Americas now accounts for 79% of the
Company's net revenue. EMEA, accounting for 16%, was down 12.5%, driven by UK
and Germany. Asia Pacific (APAC), accounting for the remaining 5% was down
14.6%, affected by Australia and Singapore. China remained stronger. Reported
Americas net revenue was £258.2 million, down 12.2%, EMEA net revenue was
£51.8 million, down 13.4% and Asia Pacific was £18.2 million, down 18.4%.
New business and AI
We are seeing our AI initiatives improve visualisation and copywriting
productivity, deliver considerably more effective and economic
hyper-personalisation (better targeted content at greater scale), delivering
more automated and integrated media planning and buying, improving general
client and agency efficiency and democratise knowledge. Monks.Flow is our AI
product solution that automates marketing workflows and we are continuing to
add applications and expand its capabilities. Our end-to-end suite of
Monks.Flow products orchestrates and helps enable our clients to more easily
implement AI solutions, particularly in visualisation and copywriting, in
hyper-personalisation at scale, in real time focus groups and linking media
planning and buying. We are now producing high quality commercials using AI
technologies such as Runway, Flux, Omniverse (Nvidia), Substance (Adobe) and
Unreal that literally take hours and days to produce at significantly lower
cost rather than traditional production techniques, which take weeks and
months at significantly greater cost. The quality continues to improve in
real time and clients that are exposed to the results of these AI technologies
are very excited about their implementation and the commercial impact on their
marketing budgets and return on investment. As a result, we are changing our
revenue model from a purely, time-based approach to one more based on outputs
- i.e. use of assets.
We are seeing significant opportunities for new business, particularly driven
by our AI tools and capability. New business wins so far this year include new
or broadened relationships with Asana, Amplifon, Samsung, Square, NCS and
Opella. We also continue to expand many of our existing relationships, in
particular General Motors and Amazon, which will ramp up significantly in the
second half of the year. In April, we won a large "Real Time Brands"
assignment with our existing client T-Mobile. In July we were engaged by a
leading US-based FMCG, as their Content Studio Agency Partner, which draws on
both our "Real Time Brands" and "Orchestration Partner" propositions with a
focus on quality creative combined with dimension and cultural relevancy,
beyond simply making assets at scale. Both of these new wins will also
contribute to our second-half performance and over time are expected to be
significant relationships for us. We continue to win multiple exploratory
assignments, as clients experiment and explore AI applications and develop AI
use cases. AI capability is becoming more central to the agency's way of
working and new business efforts. In this regard the Company's early adoption
of AI and proactive approach to staff training on AI is beginning to pay off.
Our new Go-To-Market propositions, Orchestration Partner, Real Time Brands,
Glass Box Media and Digital Transformation are all starting to resonate
strongly with clients. These are built around hyper-personalisation at scale,
social media, brand strategy, transparent media buying and planning and the
leveraging of technology.
Balance Sheet
Net debt(7) ended the first half at £145.9 million, or 2.0x net
debt/pro-forma 12 month operational EBITDA. This compared to £182.9 million
at the end of June 2024 reflecting on going focus on cashflow and improving
liquidity. The 12 month pro-forma EBITDA was £74.6 million. The balance sheet
has sufficient liquidity and long-dated debt maturities to facilitate growth
and our key covenant is net debt not to exceed 4.5x the 12 month pro-forma
EBITDA.
ESG
We remain committed to the pillars of our ESG strategy: people fulfilment, our
responsibility to the world and one brand. We continue to focus on improving
our external reporting, our reporting tools and governance to help us move
towards increased transparency and effective reporting and to comply with
future global regulatory requirements.
We continue to enjoy and maintain our B Corp status. This certification
recognises our achievements in governance and accountability, environmental
performance, social impact and DE&I, that we are accountable to all
stakeholders, not just shareowners and that we are transparent in our
reporting.
Summary and outlook
Due to the wider market uncertainty and significant volatility in global
economic policy, particularly as a result of the US-imposed tariffs, full year
like-for-like net revenue is now expected to be down by mid-single digits.
Marketing Services is forecast to be down low single digits, and although
Technology Services is forecast to be down more due to longer sales cycles and
the impact of the reduction in spending by one major client, which will cycle
out in the second half of this year.
We expect an improved performance in the second half of the year and a greater
second half weighting than in the prior year, impacted by the phasing of new
business revenue, including wins already secured and further incremental cost
reduction actions taken. We will continue to focus on our cost base and have
taken further action to support profitability.
We continue to target like-for-like operational EBITDA(4) to be broadly
similar to 2024.
Our targeted range for the year end net debt remains £100 million to £140
million. We target medium term financial leverage at the lower end of our
previous range of around 1.5 times operational EBITDA. Over the longer term we
continue to expect our operational EBITDA margins to return to historic levels
of around 20%(8).
The strategy of S(4)Capital remains the same. The Company's unitary, purely
digital transformation model, based on first-party data fuelling the creation,
production and distribution of digital advertising content, distributed by
digital media and built on technology platforms to ensure success and
efficiency, resonates with clients.
We have rebranded to Monks and are focusing all our current capabilities into
two Practices: Marketing Services(10) and Technology Services. Our tagline
'faster, better, cheaper and more' or 'speed, quality, value and more' and a
unitary structure both appeal strongly, even more so in challenging economic
times.
Financial review
Summary of results
£ millions six months ended six months ended change Reported change change
Like-for-like(3)
Pro-forma(4)
30 June 2025 30 June 2024
Billings(1) 925.9 908.9 1.9% 5.1% 5.1%
Revenue 360.4 422.5 (14.7%) (11.9%) (11.9%)
Net revenue(2) 328.2 376.1 (12.7%) (10.0%) (10.0%)
Operational EBITDA(5) 20.8 30.1 (30.9%) (30.4%) (30.4%)
Operational EBITDA margin(5) 6.3% 8.0% (170bps) (190bps) (190bps)
Adjusted operating profit(6) 16.4 24.8 (33.9%)
Adjusting items(6) (27.3) (28.5) 4.2%
Adjusted operating profit margin(6) 5.0% 6.6% (160bps)
Net finance expenses and loss on net monetary position (14.2) (13.5) (5.2%)
Adjusted result before income tax(6) 2.2 11.3 (80.5%)
Adjusted income tax expenses(6) (0.7) (3.4) 79.4%
Adjusted result for the period(6) 1.5 7.9 (81.0%)
Adjusted basic earnings per share(6) (pence) 0.2 1.2 (1.0)
Financial summary
The first half of 2025 saw challenges in our net revenue performance, however
in addition to the top line we focused on tight management of costs, aligning
headcount more closely with activity levels and working capital management and
cash, and lowering net debt. We have continued our finance transformation and
are making good progress with the roll out of our global finance system,
rationalising legal entities, integrating the finance team and aligning it to
the new two Practice structure.
In the second half of the year, the Group initiated a cost restructuring
programme to mitigate revenue challenges caused by the continuing impact of
volatile global macroeconomic conditions and general client cautiousness and
bring the staff cost to revenue ratio down from 76% towards the industry
averages of 65%.
The programme has been primarily focused on a range of non-billable roles
across the business and further back-office efficiencies. The Company's
continued investment in finance transformation projects will continue to
enable streamlining of support functions. These actions are delivering in-year
benefits and contributing to the right-sizing of the business in preparation
for 2026.
The Group is still forecasting to meet the operational EBITDA guidance.
Reported billings were £925.9 million, up 1.9% on a reported basis, up 5.1%
like-for-like.
Reported revenue was £360.4 million, down 14.7% from £422.5 million, down
11.9% like-for-like.
Reported net revenue was £328.2 million, down 12.7%, down 10.0%
like-for-like.
Operational EBITDA was £20.8 million compared to £30.1 million in the prior
year, a reported decrease of 30.9% and down 30.4% like-for-like. We have
continued to maintain a disciplined and active approach to cost management,
including headcount and discretionary costs. These controls have resulted in
the number of Monks at half year being circa 6,900, down 9% from circa 7,600
at this time last year.
Operational EBITDA margin was 6.3%, down 170 basis points versus 8.0% in the
first half of 2024 and down 190 basis points like-for-like, reflecting lower
revenue in Marketing Services(10) and Technology Services.
There was a working capital inflow of £19.2 million in the first half of 2025
compared to an inflow of £4.2 million in the first half of 2024. This
reflects both the ongoing focus on working capital management and our known
seasonality.
The reported operating loss was £10.9 million versus £3.7 million in the
first half of last year, primarily reflecting the downturn in revenue due to
the global macroeconomic environment and client caution. The loss for the
period was £22.3 million (H1 2024: £13.7 million).
£ millions Period ended Period ended Period ended Period ended Period ended Period ended
30 June 2025 Statutory results 30 June 2025 Adjusting items 30 June 2025 Adjusted Results 30 June 2024 Statutory results 30 June 2024 Adjusting items 30 June 2024 Adjusted results
Billings(1) 925.9 - 925.9 908.9 - 908.9
Revenue 360.4 - 360.4 422.5 - 422.5
Net revenue(2) 328.2 - 328.2 376.1 - 376.1
Operational EBITDA(5) 20.8 - 20.8 30.1 - 30.1
Operational EBITDA margin(5) 6.3% - 6.3% 8.0% - 8.0%
Depreciation, amortisation and impairment (27.2) 22.8 (4.4) 28.3 (23.0) 5.3
Acquisition expenses 0.1 (0.1) - (2.1) 2.1 -
Share-based payments (2.6) 2.6 - 3.8 (3.8) -
Restructuring and other one-off expenses* (2.0) 2.0 - 3.8 (3.8) -
Operating profit/ (loss) (10.9) 27.3 16.4 (3.7) 28.5 24.8
Net finance expense and loss on net monetary position (14.2) - (14.2) (13.5) - (13.5)
Result before income tax (25.1) 27.3 2.2 (17.2) - 11.3
Income tax expense 2.8 (3.5) (0.7) 3.5 (6.9) (3.4)
Result for the period (22.3) 23.8 1.5 (13.7) (6.9) 7.9
Basic loss per share (pence) (3.3) 3.5 0.2 (2.0) 3.2 1.2
Number of Monks 6,879 - 6,879 7,553 - 7,533
Net debt(7) (145.9) - (145.9) (182.9) - (182.9)
*Depreciation, amortisation and impairment excludes £5.8 million (H1 2024:
£7.2 million) right-of-use asset depreciation. Restructuring and other
one-off expenses includes £1.5 million (H1 2024: £nil) reversal of
impairment on right-of-use assets.
A full list of alternative performance measures and non-IFRS measures together
with reconciliations to IFRS or GAAP measures is set out in the Alternative
Performance Measures.
Adjusted operating profit was down 33.9% to £16.4 million from £24.8
million, before adjusting items of £27.3 million compared to £28.5 million.
Adjusting items comprises amortisation of £22.8 million (H1 2024: £23.0
million), acquisition expenses of £0.1 million gain (H1 2024: £2.1 million
gain), share-based payments of £2.6 million (H1 2024: £3.8 million) and
restructuring and other one-off expenses of £2.0 million (H1 2024: £3.8
million).
Adjusted basic earnings per share was 0.2p, versus adjusted basic earnings per
share of 1.2p in the first half of 2024, down 83.3%.
Practice and Geographic Performance
£ millions six months ended Restated(10)
30 June 2025 six months ended
30 June 2024 change Reported change change
Like-for-like(3)
Pro-forma(4)
Marketing Services(10) 299.0 330.0 (9.4%) (6.4%) (6.4%)
Technology Services 29.2 46.1 (36.7%) (35.3%) (35.3%)
Net revenue(2) 328.2 376.1 (12.7%) (10.0%) (10.0%)
Americas 258.2 294.0 (12.2%) (9.1%) (9.1%)
EMEA 51.8 59.8 (13.4%) (12.5%) (12.5%)
Asia-Pacific 18.2 22.3 (18.4%) (14.6%) (14.6%)
Net revenue(2) 328.2 376.1 (12.7%) (10.0%) (10.0%)
Marketing Services(10) 28.5 33.9 (15.9%) (14.2%) (14.2%)
Technology Services 2.6 5.7 (54.4%) (57.4%) (57.4%)
S(4) Central (10.3) (9.5) 8.4% 9.6% 9.6%
Operational EBITDA(5) 20.8 30.1 (30.9%) (30.4%) (30.4%)
Marketing Services(10) 9.5% 10.3% (80bps) (90bps) (90bps)
Technology Services 8.9% 12.4% (350bps) (460bps) (460bps)
Operational EBITDA margin(5) 6.3% 8.0% (170bps) (190bps) (190bps)
Practice performance
Marketing Services Practice reported operational EBITDA was £28.5 million,
down 15.9% versus the first half of 2024, down 14.2% like-for-like. The
Marketing Services Practice operational EBITDA margin was 9.5%, compared to
10.3% in the first half of 2024, reflecting the lower revenue, despite the
significant reduction in the number of Monks and other cost savings as
compared to 2024.
Technology Services Practice reported operational EBITDA of £2.6 million was
down 54.4% from the prior year, down 57.4% like-for-like and delivered an
operational EBITDA margin of 8.9% compared to 12.4% in the first half of 2024.
This primarily relates to the anticipated reduction in revenue from one large
client, as well as longer sales cycles for new business.
Geographic performance
The Americas reported net revenue was £258.2 million (79% of total), down
12.2% from last year. Like-for-like, the Americas net revenue was down 9.1%,
reflecting lower revenue from one large Technology Services client and
continuing client caution particularly with our technology clients. We saw
strong growth in Latin America, reflecting success with our local business.
EMEA reported net revenue was £51.8 million (16% of total), down 13.4% from
last year. Like-for-like, EMEA net revenue was down 12.5%, primarily
reflecting slower growth and client caution across the region.
APAC reported net revenue was £18.2 million (5% of total), down 18.4%.
Like-for-like, Asia Pacific net revenue was down 14.6%, affected by Australia
and Singapore, with China remaining strong, but also reflecting client caution
and local market conditions.
Cash flow
£ millions six months ended six months ended
30 June 2025 30 June 2024
Operational EBITDA 20.8 30.1
Capital expenditure(2) (2.1) (4.1)
Interest and facility fees paid (11.9) (15.2)
Interest received 1.0 1.2
Income tax paid (1.8) (7.5)
Restructuring and other one-off expenses paid (9.2) (5.6)
Change in working capital(3) 19.2 4.2
Free cashflow 16.0 3.1
Mergers & Acquisitions - (9.7)
Share buybacks - (2.5)
Other(4) (19.0) 7.0
Movement in net debt (3.0) (2.1)
Opening net debt (142.9) (180.8)
Net debt (145.9) (182.9)
Notes:
1. The table reflects how the business is managed, and this is a
non-statutory cash flow format. See page 18 for statutory cash flow format.
2. Includes purchase of intangible assets, purchase of property, plant and
equipment and security deposits.
3. Working capital primarily includes movement on receivables, payables,
principal elements of lease payments and depreciation of right-of-use assets.
4. Other includes foreign exchange loss of £18.0 million (H1 2024: £5.8
million gain) and hyperinflation loss of £0.8 million (H1 2024: £1.2 million
gain).
Free cashflow for the period was £16.0 million, an improvement of £12.9
million compared to the first half of 2024, with a higher working capital
inflow and lower cash tax paid.
Cash paid in relation to combinations (M&A) decreased to nil versus the
prior year of £9.7 million, as the Group materially completed payments for
prior year combinations.
Working capital inflow of £19.2 million on H1 2025 compares to an inflow of
£4.2 million in H1 2024. This reflects the ongoing focus on working capital
management and our known seasonality.
Treasury and net debt
six months ended six months ended
30 June 2025
30 June 2024
Net debt reconciliation
£ millions
Cash and cash equivalents 175.1 135.0
Loans and borrowings (including bank overdrafts) (321.0) (317.9)
Net debt (145.9) (182.9)
The half year net debt was £145.9 million (H1 2024: £182.9 million) or 2.0x
net debt/12 month pro-forma operational EBITDA. The balance sheet has
sufficient liquidity and long dated debt maturities. During the period
S(4)Capital Group complied with the covenants set in its loan agreement. The
pro-forma 12 month operational EBITDA for the period to 30(th) June 2025 was
£74.6 million.
S(4)Capital Group's key covenant is that the net debt should not exceed 4.5:1
of the pro-forma earnings before interest, tax, depreciation and amortisation.
This ratio is measured at the end of any relevant period of 12 months ending
each semi-annual date in a financial year, as defined in the facility
agreement. As at 30 June 2025, the net debt/pro-forma EBITDA, as defined by
the facilities agreement, was 1.9x.
The duration of the 2021 facilities agreement is seven years in relation to
the Term Loan B and the termination date is August 2028. The term of the RCF
is five years and the termination date was August 2026. £80 million of the
RCF facility has been extended to February 2028, with all four relationship
banks extending on the same terms, with the remaining £20 million terminating
in August 2026. The RCF remains undrawn as at 30 June 2025.
Interest and tax
Consolidated net finance costs and loss on net monetary position were £14.2
million (H1 2024: £13.5 million), an increase of £0.7 million. This was
driven by adverse foreign exchange movements, partially offset by a reduction
in interest on bank loan. The profit or loss tax credit for the period was
£2.8 million (H1 2024: £3.5 million).
Balance sheet
Overall the Group reported net assets of £501.6 million as at 30 June 2025,
which is a decrease of £75.9 million compared to 31 December 2024, driven
mainly by amortisation of intangible assets and foreign exchange losses.
Dividend
A final dividend of 1.0 pence per share was declared during the period, and
was subsequently paid to shareholders on the 10 July 2025, amounting to £6.1
million. The Board is not proposing an interim dividend and will consider
approving an enhanced final dividend for 2025, if the improved second half
performance and liquidity targets are delivered.
Acquisitions
No acquisitions were made in the six months ended 30 June 2025.
Responsibility Statement
The directors confirm that these condensed unaudited consolidated interim
financial statements have been prepared in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting' and the
Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority and that the interim management report includes a
fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely:
/ an indication of important events that have occurred during the first
six months and their impact on the condensed unaudited consolidated interim
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial year; and
/ material related-party transactions in the first six months and any
material changes in the related-party transactions described in the last
annual report.
The maintenance and integrity of the S(4)Capital plc website is the
responsibility of the directors; the work carried out by the authors does not
involve consideration of these matters and, accordingly, the auditors accept
no responsibility for any changes that might have occurred to the condensed
unaudited consolidated interim financial statements since they were initially
presented on the website. The directors of S(4)Capital plc are listed in the
S(4)Capital plc Annual Report and Accounts for the year ended 31 December
2024, with the exception of the following changes in the period: Radhika
Radhakrishnan and Nirvik Singh were appointed and Mary Basterfield stepped
down from the Board. A list of current directors is maintained on the
S(4)Capital plc website: www.s4capital.com (http://www.s4capital.com) .
By order of the Board
Sir Martin
Sorrell
Radhika Radhakrishnan
Chairman
Chief Financial Officer
About S(4)Capital
Our strategy is to build a purely digital advertising and marketing services
business for global, multinational, regional, and local clients, and
millennial-driven influencer brands. This will be achieved by integrating
leading businesses in two synchronised Practices: Marketing Services and
Technology services, along with an emphasis on 'faster, better, cheaper, more'
execution in an always-on consumer-led environment, with a unitary structure.
The Company now has approximately 7,000 people in 33 countries with
approximately 80% of net revenue across the Americas, 15% across Europe, the
Middle East and Africa and 5% across Asia-Pacific. The longer-term objective
is a geographic split of 60%:20%:20%. Marketing Services accounted for
approximately 90% of net revenue, and Technology Services 10%. The longer term
objective is a practice split of 75%:25%.
Sir Martin was CEO of WPP for 33 years, building it from a £1 million 'shell'
company in 1985 into the world's largest advertising and marketing services
company, with a market capitalisation of over £16 billion on the day he left.
Prior to that Sir Martin was Group Financial Director of Saatchi & Saatchi
Company Plc for nine years.
Unaudited consolidated interim statement of profit or loss
For the six month period ended 30 June 2025
Six months Six months
ended ended
30 June 2025 30 June 2024
£m £m
Note
Revenue 7 360.4 422.5
Direct costs (32.2) (46.4)
Net revenue 7 328.2 376.1
Personnel costs (262.4) (301.1)
Other operating expenses (41.8) (41.6)
Acquisition, restructuring and other one-off expenses (3.4) (1.7)
Depreciation, amortisation and impairment (31.5) (35.5)
Share of profit of joint ventures and associates - 0.1
(339.1)
Total operating expenses (379.8)
Operating (loss)/profit (10.9) (3.7)
Adjusted operating profit 16.4 24.8
Adjusting items(1) (27.3) (28.5)
Operating (loss)/profit (10.9) (3.7)
1.2
Finance income 1.5
Finance costs (15.1) (14.4)
(13.9)
Net finance costs (12.9)
Loss on the net monetary position (0.3) (0.6)
(25.1)
Loss before income tax (17.2)
Income tax credit 2.8 3.5
(22.3)
Loss for the period (13.7)
Attributable to owners of the Company (22.3) (13.7)
Attributable to non-controlling interests - -
(22.3) (13.7)
Loss per share is attributable to the ordinary equity holders of the Company
Basic loss per share (pence)
(3.3) (2.0)
Diluted loss per share (pence) (3.3) (2.0)
Notes:
1. Adjusting items comprises amortisation of £22.8 million (H1 2024:
£23.0 million), acquisition expenses of £0.1 million gain (H1 2024: £2.1
million gain), share-based payments of £2.6 million (H1 2024: £3.8 million)
and restructuring and other one-off expenses of £2.0 million (H1 2024: £3.8
million).
The results for the period are wholly attributable to the continuing
operations of the Group.
Unaudited consolidated interim statement of comprehensive income
For the six month period ended 30 June 2025
Six months Six months
ended ended
30 June 2025 30 June 2024
£m £m
Loss for the period (22.3) (13.7)
Other comprehensive expense
Items that may be reclassified to profit or loss (51.4)
Foreign operations - foreign currency translation differences (5.1)
(51.4)
Other comprehensive expense (5.1)
Total comprehensive expense for the period (73.7) (18.8)
(73.7)
Attributable to owners of the Company (18.8)
Attributable to non-controlling interests - -
(73.7) (18.8)
Unaudited consolidated interim balance sheet
As at 30 June 2025
30 June 31 December 2024
2025
£m
Note £m
Assets
Goodwill 8 374.1 391.2
Intangible assets 278.0 315.2
Right-of-use assets 30.3 34.7
Property, plant and equipment 13.1 16.4
Interest in joint ventures and associates 0.8 0.8
Deferred tax assets 47.8 49.0
Other receivables 4.2 9.2
Non-current assets 748.3 816.5
Trade and other receivables 352.2 450.8
Current tax assets 8.5 9.6
Cash and cash equivalents 175.1 168.4
Current assets 535.8 628.8
Total assets 1,284.1 1,445.3
Liabilities
Deferred tax liabilities (17.1) (18.6)
Loans and borrowings (317.2) (307.2)
Lease liabilities (22.9) (29.7)
Contingent consideration and holdbacks 9 - (4.8)
Provisions (2.4) (3.5)
Non-current liabilities (359.6) (363.8)
Trade and other payables (396.8) (482.0)
Contingent consideration and holdbacks 9 (8.6) (4.7)
Loans and borrowings (0.1) (0.2)
Lease liabilities (12.7) (12.8)
Provisions (1.7) (0.8)
Current tax liabilities (3.0) (3.5)
Current liabilities (422.9) (504.0)
Total liabilities (782.5) (867.8)
Net assets 501.6 577.5
Equity
Share capital 154.9 154.9
Share premium 164.9 164.9
Other reserves 72.2 70.7
Foreign exchange reserves (74.3) (22.9)
Retained earnings 183.8 209.8
Attributable to owners of the Company 501.5 577.4
Non-controlling interests 0.1 0.1
Total equity 501.6 577.5
Unaudited consolidated interim statement of changes in equity
For the period ended 30 June 2025
Share capital(1) Share premium Other reserves(2) Foreign exchange reserves Retained earnings/ (accumulated losses) Attributable to owners of the Company Non-controlling interests Total equity
£m £m £m £m £m £m £m £m
At 1 January 2024 145.9 80.4 162.7 (6.1) 508.9 891.8 0.1 891.9
Hyperinflation restatement - - 3.5 - - 3.5 - 3.5
Adjusted 145.9 80.4 166.2 (6.1) 508.9 895.3 0.1 895.4
opening balance
Comprehensive expense for the period
Loss for the period - - - - (13.7) (13.7) - (13.7)
Other comprehensive expense - - - (5.1) - (5.1) - (5.1)
Total comprehensive expense for the period - - - (5.1) (13.7) (18.8) - (18.8)
Transactions with owners of the Company
Business combinations 7.6 75.5 (83.7) - 0.6 - - -
Share-based payments - - 0.3 - 3.5 3.8 - 3.8
Share buy-backs - - (2.5) - - (2.5) - (2.5)
At 30 June 2024 153.5 155.9 80.3 (11.2) 499.3 877.8 0.1 877.9
Hyperinflation restatement - - 1.0 - - 1.0 - 1.0
Adjusted 153.5 155.9 81.3 (11.2) 499.3 878.8 0.1 878.9
opening balance
Comprehensive expense for the period
Loss for the period - - - - (293.2) (293.2) - (293.2)
Other comprehensive - - - (11.7) - (11.7) - (11.7)
income
Total comprehensive expense for the period - - - (11.7) (293.2) (304.9) - (304.9)
Transactions with owners of the Company
Business combinations 1.4 9.0 (11.2) - 1.2 0.4 - 0.4
Share-based payments - - 0.6 - 2.5 3.1 - 3.1
Share buy-backs - - - - - - - -
At 31 December 2024 154.9 164.9 70.7 (22.9) 209.8 577.4 0.1 577.5
Hyperinflation restatement - - 1.3 - - 1.3 - 1.3
Adjusted 154.9 164.9 72.0 (22.9) 209.8 578.7 0.1 578.8
opening balance
Comprehensive expense for the period
Loss for the period - - - - (22.3) (22.3) - (22.3)
Other comprehensive - - - (51.4) - (51.4) - (51.4)
income
Total comprehensive expense for the period - - - (51.4) (22.3) (73.7) - (73.7)
Transactions with owners of the Company
Business combinations - - - - - - - -
Dividends(3) - - - - (6.1) (6.1) - (6.1)
Share-based payments - - 0.2 - 2.4 2.6 - 2.6
At 30 June 2025 154.9 164.9 72.2 (74.3) 183.8 501.5 0.1 501.6
Notes:
1. At the end of the reporting period, the issued and paid up share capital
of S(4)Capital plc consisted of 619,636,656 (H1 2024: 613,789,301) Ordinary
Shares having a nominal value of £0.25 per Ordinary Share.
2. Other reserves primarily includes the deferred equity consideration
arising from business combinations of £61.3 million (H1 2024: £72.5
million), made up of the following: TheoremOne for £26.4 million, Raccoon for
£17.4 million, XX Artists for £17.5 million, the treasury shares issued in
the name of S(4)Capital plc to an employee benefit trust for the amount of
£2.6 million (H1 2024: £0.9 million), share buy-backs of £nil (H1 2024:
£2.5 million) and hyperinflation restatement in Argentina of £13.3 million
(H1 2024: £11.0 million).
3. The £6.1 million dividend represents a final dividend of 1.0p per
ordinary share in respect of the year ended 31 December 2024 which was
approved during the period and subsequently paid on 10 July 2025.
Unaudited consolidated interim statement of cashflows
For the period ended 30 June 2025
Six months Six months
Note ended ended
30 June 2025 30 June 2024
£m £m
Cash flows from operating activities
Loss before income tax (25.1) (17.2)
Net finance costs 13.9 12.9
Depreciation, amortisation and impairment 31.5 35.5
Share-based payments 2.6 3.8
Acquisition, restructuring and other one-off expenses 3.4 1.7
Employment linked contingent consideration paid(1) - (2.9)
Restructuring and other one-off expenses paid (9.2) (5.6)
Share of profit in joint venture - (0.1)
Loss on the net monetary position 0.3 0.6
Other non-cash items (0.8) 1.2
Decrease in trade and other receivables 73.5 31.3
Decrease in trade and other payables (53.5) (27.6)
Cash flows from operations 36.6 33.6
Income taxes paid (1.8) (7.5)
Net cash flows generated from operating activities 34.8 26.1
Cash flows from investing activities
Purchase of intangible assets (0.6) (1.9)
Purchase of property, plant and equipment (1.6) (2.6)
Acquisition of subsidiaries, net of cash acquired(1) 6, 9 - (6.8)
Interest received 1.0 1.2
Amounts withdrawn from security deposits 0.1 0.4
Cash flows used in investing activities (1.1) (9.7)
Cash flows from financing activities
Share buy-backs - (2.5)
Principal element of lease payments (6.5) (6.6)
Repayments of loans and borrowings (0.1) (0.1)
Transaction costs on borrowings (0.4) -
Interest and facility fees paid (11.9) (15.2)
Cash flows used in financing activities (18.9) (24.4)
Net movement in cash and cash equivalents 14.8 (8.0)
Cash and cash equivalents at the beginning of the period 168.4 145.7
Exchange loss on cash and cash equivalents (8.1) (2.7)
Cash and cash equivalents at the end of the period 175.1 135.0
Note:
1. Comprises contingent consideration and holdback payments, net of cash
released from escrow accounts of £nil (H1 2024: £3.5 million).
Notes to the unaudited consolidated interim financial statements
For the period ended 30 June 2025
1. General information
S(4)Capital plc ('S(4)Capital' or 'Company') is a public limited company
incorporated on 14 November 2016 in the United Kingdom. The Company has its
registered office at 12 St James's Place, London, SW1A 1NX, United Kingdom.
Its shares are listed on the London Stock Exchange. The new UK Listing Rules,
which came into force on 29 July 2024, have removed the distinction between
standard and premium listing categories, which are now categorised as equity
shares commercial companies (ESCC). As at the date of approval of the
condensed unaudited consolidated interim financial statements, S(4)Capital plc
is in the Transition category.
The condensed unaudited consolidated interim financial statements represent
the results of the Company and its subsidiaries (together referred to as
'S(4)Capital Group' or the 'Group').
S(4)Capital Group is a tech-led, new age/new era digital advertising and
marketing and technology services company.
2. Basis of preparation
A. Statement of compliance
This report is to be read in conjunction with the Annual Report and Accounts
of S(4)Capital plc for the year ended 31 December 2024 and has been prepared
in accordance with UK adopted International Accounting Standards and with the
requirements of the Companies Act 2006 as applicable to companies reporting
under those standards.
The condensed unaudited consolidated interim financial statements for the 6
months period ended 30 June 2025 are a condensed set of financial information
and have been prepared on the basis of the policies set out in the 2024 annual
financial statements and in accordance with UK adopted IAS 34 and the
Disclosure Guidance and Transparency Rules sourcebook of the UK's Financial
Conduct Authority.
The Group has undertaken a detailed going concern assessment, reviewing its
current and projected financial performance and position. The Directors
believe that the Group's forecasts have been prepared on a prudent basis.
Considering the Group's bank covenant and liquidity headroom and cost
mitigation actions which could be implemented, the Directors have concluded
that the Group will be able to operate within its facilities and comply with
its banking covenants for the foreseeable future and therefore believe it is
appropriate to prepare the financial statements of the Group on a going
concern basis and that there are no material uncertainties which gives rise to
a significant going concern risk. Given its debt maturity profile and
available facilities, the Directors believe the Group has sufficient liquidity
to match its requirements for at least 12 months from the reporting date.
The condensed unaudited consolidated interim financial statements were
authorised for issue by the Board of Directors on 14 September 2025.
B. Functional and presentation currency
The condensed unaudited consolidated interim financial statements are
presented in Pound Sterling (GBP or £), the Company's functional currency.
All financial information in Pound Sterling has been rounded to the nearest
million unless otherwise indicated.
C. Re-presentation of segment information
Following our organisational announcement, effective 1 January 2025, the
Group's reportable segments under IFRS 8 'Operating Segments' comprise two
practices; Marketing Services and Technology Services. Marketing Services
comprises the previously reported Content and Data&Digital Media segments.
The information presented for prior periods have been re-presented to be on a
consistent basis with the new segments.
D. Principal risks and uncertainties
The principal risks and uncertainties facing the Group at the 2024 year end
are set out in detail on pages 20 to 22 of the Annual Report and Accounts
2024. The principal risks and uncertainties facing the Group at the 30 June
2025 remain the same and relate to the following:
/ Macroeconomic headwinds
/ Operational decision making and internal efficiencies
/ Talent lifecycle
/ Governance and compliance
/ Artificial intelligence
/ Business transformation
/ Key customers
/ Reputation risk
/ Information security and data privacy
/ Competitive environment
3. Significant accounting policies
The condensed unaudited consolidated interim financial statements have been
prepared on a consistent basis with the accounting policies of the Group which
were set out on pages 122 to 131 of the Annual Report and Accounts 2024,
excluding the impact of amended standards as detailed below.
The following amended standard became applicable for the current reporting
period. This is as follows:
Lack of exchangeability - Amendments to IAS 21
In August 2023, the Board issued Lack of Exchangeability (Amendments to IAS
21). The amendment to IAS 21 The Effects of Changes in Foreign Exchange Rates
specifies how an entity should assess whether a currency is exchangeable and
how it should determine a spot exchange rate when exchangeability is lacking.
The amendment is effective for annual reporting periods beginning on or after
1 January 2025. The Group adopted these amendments as of 1 January 2025. The
adoption of this had no material impact on the Group's condensed unaudited
consolidated interim financial statements.
4. Critical accounting judgements and estimates
In preparing these condensed unaudited consolidated interim financial
statements, the critical accounting judgements and estimates made by
management in applying the Group's accounting policies and the key sources of
estimation uncertainty were the same as those that applied to the Annual
Report and Accounts 2024.
5. Statutory information and independent review
The condensed unaudited consolidated interim financial statements for the six
months period ended 30 June 2025 do not constitute statutory accounts within
the meaning of section 434 of the Companies Act 2006. The statutory accounts
for the year ended 31 December 2024 have been delivered to the Registrar of
Companies and received an unqualified auditors' report, did not include a
reference to any matters to which the auditors drew attention by way of an
emphasis of matter and did not contain a statement under sections 498 (2) or
(3) of the Companies Act 2006. The condensed consolidated interim financial
statements are unaudited but have been reviewed by the auditors and their
report is set out on the last page.
6. Acquisitions
Current year acquisitions
There were no acquisitions during the period ended 30 June 2025.
Prior year acquisitions
TheoremOne
Included within other reserves as at 30 June 2025 is £26.4 million, comprised
of £26.4 million recognised as deferred equity consideration in 2023.
As at 30 June 2025, £5.6 million of holdbacks remain relating to amounts held
back due to cover and indemnify the Group against certain acquisition costs
and damages. The Group currently expects to settle the maximum holdback
amount. The amount payable would be dependent on the amount of these
acquisition costs and damages, with the minimum amount payable being £nil.
7. Segment information
A. Operating segments
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker (CODM). The CODM has
been identified as the Board of Directors of S(4)Capital Group.
Following our organisational announcement, effective 1 January 2025, the
Group's reportable segments comprise two practices: Marketing Services and
Technology Services. Marketing Services comprises the previously reported
Content and Data&Digital Media segments. The information presented for
prior periods have been re-presented to be on a consistent basis with the new
segments.
During the period, S(4)Capital Group has two reportable segments as follows:
· Marketing Services practice: Creative content, campaigns, and
assets at a global scale for paid, social and earned media - from digital
platforms and apps to brand activations that aim to convert consumers at every
possible touchpoint. Full-service campaign management analytics, creative
production and ad serving, platform and systems integration and transition,
training and education.
· Technology Services practice: digital transformation services in
delivering advanced digital product design, engineering services and delivery
services.
The customers are primarily businesses across technology, FMCG and media and
entertainment. Any intersegment transactions are based on commercial terms.
The Board of Directors monitor the results of the reportable segments
separately for the purpose of making decisions about resource allocation and
performance assessment prior to charges for tax, depreciation and
amortisation.
The Board of S(4)Capital Group uses net revenue rather than revenue to manage
the Company due to the fluctuating amounts of direct costs, which are
recharged as part of revenue.
The following is an analysis of the Group's net revenue and results by
reportable segments:
Marketing Services Technology Services
Six months ended 30 June 2025 £m £m Total
£m
Revenue 331.1 29.3 360.4
Net revenue 299.0 29.2 328.2
Segment profit(2,3) 28.5 2.6 31.1
Overhead costs (10.3)
Adjusted non-recurring and acquisition related expenses(4) (4.5)
Depreciation, amortisation and impairment(5) (27.2)
Net finance costs and gain on net monetary position (14.2)
Loss before income tax (25.1)
Restated(1)
Marketing Services Technology Services
Six months ended 30 June 2024 £m £m Total
£m
Revenue 376.3 46.2 422.5
Net revenue 330.0 46.1 376.1
Segment profit(2,3) 33.9 5.7 39.6
Overhead costs (9.5)
Adjusted non-recurring and acquisition related expenses(4) (5.5)
Depreciation and amortisation(5) (28.3)
Net finance costs and loss on net monetary position (13.5)
Loss before income tax (17.2)
Notes:
1. Comparative information for the prior period has been represented to
reflect the Group's revised segment structure.
2. Including £5.8 million (H1 2024: £7.2 million) depreciation and £1.5
million (H1 2024: £nil) reversal of impairment on right-of-use assets.
3. In arriving at segment profit, personnel costs of £231.5 million (H1 2024:
£257.2 million) and £24.2 million (H1 2024: £37.0 million) were deducted
from Marketing Services and Technology Services respectively.
4. Comprised of acquisition and restructuring expenses of £1.7 million (H1
2024: £0.3 million credit), share-based payment costs of £2.6 million (H1
2024: £3.8 million), transformation costs of £2.6 million (H1 2024: £2.0
million), reversal of impairment of right-of-use assets of £1.5 million (H1
2024: £nil) and reversal of onerous lease provision of £0.9 million gain (H1
2024: £nil).
5. Excluding £5.8 million (H1 2024: £7.2 million) depreciation and £1.5
million (H1 2024: £nil) reversal of impairment on right-of-use assets.
Segment profit represents the profit earned by each segment without allocation
of the share of loss of joint ventures, central administration costs including
Directors' salaries, finance income, non-operating gains and losses, and
income tax expense. This is the measure reported to the Group's Board of
Directors for the purpose of resource allocation and assessment of segment
performance.
B. Information about major customers
One (H1 2024: one) customer accounted for more than 10% of the Group's revenue
during the period, contributing £63.1 million (H1 2024: £73.3 million). The
revenue from this customer was attributable to the Marketing Services segment.
8. Goodwill
Six months ended 30 June 2025 Year ended 31 December 2024
Cost £m £m
At the start of the period 697.3 706.5
Acquired through business combinations - -
Foreign exchange differences (30.5) (9.2)
At the end of the period 666.8 697.3
Six months ended 30 June 2025 Year ended 31 December 2024
Accumulated impairment £m £m
At the start of the period (306.1) (15.2)
Impairment charge in period - (280.4)
Foreign exchange differences 13.4 (10.5)
At the end of the period (292.7) (306.1)
Six months ended 30 June 2025 Year ended 31 December 2024
Net book value £m £m
At the start of the period 391.2 691.3
At the end of the period 374.1 391.2
Goodwill represents the excess of consideration over the fair value of the
Group's share of the net identifiable assets acquired.
9. Financial instruments
Financial instruments by category
Six months ended 30 June 2025 Year ended 31 December 2024
Financial assets £m £m
Financial assets held at amortised cost
Cash and cash equivalents 175.1 168.4
Trade receivables 220.2 364.7
Accrued income 41.4 31.1
Other receivables 84.1 48.2
Total 520.8 612.4
Six months ended 30 June 2025 Year ended 31 December 2024
Financial liabilities £m £m
Financial liabilities held at amortised cost
Trade and other payables (324.4) (412.8)
Loans and borrowings (317.4) (307.4)
Lease liabilities (35.6) (42.5)
Financial liabilities held at fair value through profit and loss
Contingent consideration and holdbacks (8.6) (9.5)
Total (686.0) (772.2)
The following table categorises the Group's financial liabilities held at fair
value on the unaudited consolidated balance sheet. There have been no
transfers between levels during the period (H1 2024: none).
Year ended 31 December 2024
Six months ended 30 June 2025 Six months ended 30 June 2025 Fair value Year ended 31 December 2024
Fair value Level 3 £m Level 3
Financial liabilities £m £m £m
Contingent consideration and holdbacks (8.6) (8.6) (9.5) (9.5)
Total (8.6) (8.6) (9.5) (9.5)
The following table shows the movement in contingent consideration and
holdbacks.
Performance Employment
linked linked
contingent contingent
Contingent consideration and holdbacks consideration consideration Holdbacks(1) Total
£m £m £m £m
Balance at 1 January 2024 (9.0) (3.0) (13.5) (25.5)
Recognised in consolidated statement of profit or loss - (0.7) 3.0 2.3
Cash paid 6.7 2.9 3.9 13.5
Equity settlement - - 0.2 0.2
Exchange rate differences (0.1) - 0.1 -
Balance at 31 December 2024 (2.4) (0.8) (6.3) (9.5)
Cash paid - - 0.2 0.2
Equity settlement - - - -
Exchange rate differences 0.1 0.1 0.5 0.7
Balance at 30 June 2025 (2.3) (0.7) (5.6) (8.6)
Included in current liabilities (2.4) (0.8) (1.5) (4.7)
Included in non-current liabilities - - (4.8) (4.8)
Balance at 31 December 2024 (2.4) (0.8) (6.3) (9.5)
Included in current liabilities (2.3) (0.7) (5.6) (8.6)
Included in non-current liabilities - - - -
Balance at 30 June 2025 (2.3) (0.7) (5.6) (8.6)
Notes:
1. Holdback payments of £0.2 million (2024: £3.5 million) includes £0.2
million (2024: £3.5 million) of cash paid out of escrow accounts
Where the contingent consideration conditions have been satisfied,
consideration that is payable as equity is recognised within other reserves as
deferred equity consideration.
The fair value of the performance linked contingent consideration has been
determined based on management's best estimate of achieving future targets to
which the consideration is linked. The most significant unobservable input
used in the fair value measurements is the future forecast performance of the
acquired business. The fair value is assessed and recognised at the
acquisition date, and reassessed at each balance sheet date thereafter, until
fully settled, cancelled or expired. Any change in the range of future
outcomes is recognised in the consolidated statement of profit or loss. During
the period ended 30 June 2025, a fair value gain of £nil (H1 2024: £nil) was
recognised in the consolidated statement of profit or loss.
The fair value of the employment linked contingent consideration has been
determined based on management's best estimate of achieving future targets to
which the consideration is linked. The most significant unobservable input
used in the fair value measurements is the future forecast performance of the
acquired business. The fair value is assessed at the acquisition date, and
systematically accrued over the respective employment term. Any changes in the
range of future outcomes are recognised in the consolidated statement of
profit or loss. During the period ended 30 June 2025, a £nil (H1 2024: £0.3
million charge) was recognised in the consolidated statement of profit or
loss. The £nil charge (H1 2024: £0.3 million charge) comprised a charge of
£nil (H1 2024: £0.3 million) relating to the systematic accrual of the
employment linked contingent consideration and a fair value gain of £nil (H1
2024: £nil).
Holdbacks relate to amounts held by the Group to cover and indemnify the Group
against certain acquisition costs and damages. The fair value of the holdbacks
has been determined based on management's best estimate of the level of the
costs incurred and damages expected to which the holdback is linked, which is
the most significant unobservable input used in the fair value measurement.
During the period ended 30 June 2025, £nil (H1 2024: £2.5 million gain) has
been recognised in the consolidated statement of profit or loss, which related
to holdbacks liabilities linked to employment.
10. Net debt reconciliation
The following table shows the reconciliation of net cash flow to movements in
net debt:
Net debt including lease liabilities
Borrowings and overdrafts Cash Net debt Leases £m
£m £m £m £m
Net debt as at 1 January 2024 (326.5) 145.7 (180.8) (49.0) (229.8)
Financing cash flows (0.1) (8.0) (8.1) 6.6 (1.5)
Lease additions - - - (0.8) (0.8)
Foreign exchange adjustments 8.7 (2.7) 6.0 0.8 6.8
Interest expense (12.3) - (12.3) (1.2) (13.5)
Interest payment 12.3 - 12.3 1.2 13.5
Other - - - (2.5) (2.5)
Net debt as at 30 June 2024 (317.9) 135.0 (182.9) (44.9) (227.8)
Financing cash flows 0.3 35.3 35.6 6.1 41.7
Lease additions - - - (1.2) (1.2)
Foreign exchange adjustments 6.3 (1.9) 4.4 0.8 5.2
Interest expense (13.2) - (13.2) (1.3) (14.5)
Interest payment 13.2 - 13.2 1.3 14.5
Other - - - (3.3) (3.3)
Net debt as at 31 December 2024 (311.3) 168.4 (142.9) (42.5) (185.4)
Financing cash flows 0.1 14.8 14.9 6.5 21.4
Lease additions - - - (0.9) (0.9)
Foreign exchange adjustments (9.9) (8.1) (18.0) 0.9 (17.1)
Interest expense (9.8) - (9.8) (1.1) (10.9)
Interest payment 9.9 - 9.9 1.1 11.0
Other - - - 0.4 0.4
Net debt as at 30 June 2025 (321.0) 175.1 (145.9) (35.6) (181.5)
11. Related party transactions
Details of compensation for key management personnel for the 12 months to 31
December 2024 are disclosed on pages 84 to 100 of the Annual Report and
Accounts 2024. Apart from the key management personnel compensation and the
interest in S4S Ventures and Hoorah detailed in the Annual Report and Accounts
2024, S(4)Capital Group did not have any other related party transactions
during the financial period (H1 2024: nil).
On 2 January 2025, the Group and Alvear Ltd became equal shareholders in a
joint venture entity, Monkfilms Ltd ("Monkfilms"). The primary commercial
objective of the joint venture is to secure a production and distribution deal
with a major media company for a World Cup 2026 documentary film with FIFA.
12. Events occurring after the reporting period
A £6.1 million dividend was paid on 10 July 2025, representing a final
dividend of 1.0p per ordinary share in respect of the year ended 31 December
2024 which was approved during the period and subsequently paid. There were no
other material post balance sheet events, that require adjustment or
disclosure, occurring between the reporting period and the 14 September 2025.
Appendix- Alternative Performance Measures
The Group has included various alternative performance measures (APMs) in its
condensed unaudited consolidated interim financial statements . The Group
includes these non-GAAP measures as it considers these measures to be both
useful and necessary to the readers of these condensed unaudited consolidated
interim financial statements to help them more fully understand the
performance and position of the Group. The Group's measures may not be
calculated in the same way as similarly titled measures reported by other
companies. The APMs should not be viewed in isolation and should be considered
as additional supplementary information to the IFRS measures. Full
reconciliations have been provided between the APMs and their closest IFRS
measures.
The Group has concluded that these APMs are relevant as they represent how the
Board assesses the performance of the Group and they are also closely aligned
with how shareowners value the business. They provide like-for-like,
year-on-year comparisons and are closely correlated with the cash inflows from
operations and working capital position of the Group. They are used by the
Group for internal performance analysis and the presentation of these measures
facilitates comparison with other industry peers as they adjust for
non-recurring factors which may materially affect IFRS measures. Adjusting
items for the Group include amortisation of acquired intangibles, acquisition
related expenses costs, share-based payments, employment-related acquisition
costs and restructuring costs. Whilst adjusted measures exclude amortisation
of intangibles, acquisition costs and restructuring costs they do include the
revenue from acquisitions and the benefits of the restructuring programmes and
therefore should not be considered a complete picture of the Group's financial
performance, that is provided by the IFRS measures.
The adjusted measures are also used in the calculation of the adjusted
earnings per share and banking covenants as per our agreements with our
lenders.
Closest IFRS measure Adjustments to reconcile to IFRS Measure
APM Reason for use
Unaudited consolidated interim statement of profit or loss
Controlled Billings Revenue Includes media spend contracted directly by clients with media providers and To help understand the scale of the activities that Group has managed on
pass-through costs (see reconciliation A1 below) behalf of its clients, in addition to the activities that are directly
invoiced by the Group.
Billings Revenue Includes pass through costs (see reconciliation A1 below) To understand the activities that are directly invoiced by the Group to its
clients.
Net Revenue Revenue Excludes direct costs (see reconciliation A2 below) This is more closely aligned to the fees the Group earns for its services
provided to the clients. This is a key metric used by the Group when looking
at the Practice performance.
Operational EBITDA Operating loss Excludes acquisition related expenses, non-recurring items (primarily Operational EBITDA is Operating profit or loss before the impact of adjusting
acquisition payments tied to continued employment, amortisation of business items, amortisation of intangible assets and PPE depreciation. The Group
combination intangible assets and restructuring and other one-off expenses) considers this to be an important measure of Group performance and is
and recurring share-based payments, and includes right-of-use assets consistent with how the Group is assessed by the Board and investment
depreciation. (see reconciliation A3 below) community.
Closest IFRS measure Adjustments to reconcile to IFRS Measure
APM Reason for use
Like-for-Like Revenue and operating profit Is the prior year comparative, in this case 2024, restated to include acquired Like-for-like is used by the Board and investors when looking at Group
businesses for the same months as 2025, and restated using same FX rates as performance. It provides a comparison that reflects the impact of
used in 2025 (see reconciliations A4 below) acquisitions and changes in FX rates during the period.
Pro-forma Revenue and operating profit Is the period consolidated results in constant currency and for acquisitions Pro-forma figures are used extensively by management and the investment
as if the Group had existed in full for the period (see reconciliations A5 community. It is a useful measure when looking at how the Group has changed
below) in light of the number of acquisitions that have been completed and to
understand the performance of the Group.
Adjusted basic earnings per share Basic earnings per share Excludes amortisation of intangible assets, acquisition related expenses, Adjusted basic earnings per share is used by management to understand the
share-based payments and restructuring and other one-off expenses (see earnings per share of the Group after removing non-recurring items and those
reconciliation A6 below) linked to combinations.
Adjusted (loss)/profit for the period (Loss)/profit for the period Excludes amortisation of intangible assets, acquisition related expenses, Adjusted (loss)/profit for the period is used by management to understand the
share-based payments and restructuring and other one-off expenses (see (loss)/profit for the Group after removing non-recurring items and those
reconciliation A6 below) linked to combinations.
Unaudited consolidated interim balance sheet
Net debt Cash and loans and borrowings Net debt is cash less gross bank loans (excluding transaction costs and lease Net debt is a commonly used metric to identify the debt obligations of the
liabilities). This is a key measure used by management and in calculations for Group after utilising cash in bank.
bank covenants (see reconciliation A7 below)
Unaudited consolidated interim statement of cashflows
Free cash flow Net cash (used in)/from operating activities Net cash flow from operating activities adjusted for investments in Free cash flow is a commonly used metric used to identify the amount of cash
intangibles and property, plant and equipment, lease liabilities, interest and at the disposal of the Group.
facility fees paid, security deposits and employment linked contingent
consideration paid.
Six months ended 30 June 2025 Six months ended 30 June 2024
Billings and controlled billings (A1) £m £m
Revenue 360.4 422.5
Pass-through expenses 565.5 486.4
Billings(1) 925.9 908.9
Third party billings direct to clients 1,377.1 1,531.8
Controlled billings(2) 2,303.0 2,440.7
Notes:
1. Billings is gross billings to clients including pass-through expenses.
2. Controlled billings are billings we influenced.
Six months ended 30 June 2025 Six months ended 30 June 2024
Net revenue (A2) £m £m
Revenue 360.4 422.5
Direct costs (32.2) (46.4)
Net revenue 328.2 376.1
Six months ended 30 June 2025 Six months ended 30 June 2024
Reconciliation to operational EBITDA (A3) £m £m
Operating loss (10.9) (3.7)
Amortisation of intangible assets 22.8 23.0
Acquisition expenses (0.1) (2.1)
Share-based payments 2.6 3.8
Restructuring and other one-off expenses(1) 2.0 3.8
Depreciation of property, plant and equipment(2) 4.4 5.3
Operational EBITDA 20.8 30.1
Notes:
1. Restructuring and other one-off expenses relate to restructuring costs
of £1.8 million (H1 2024: £1.7 million), transformation costs of £2.6
million (H1 2024: £2.1 million), reversal of impairment of right-of-use
assets of £1.5 million (H1 2024: £nil), reversal of onerous lease provision
of £0.9 million (H1 2024: £nil).
2. Depreciation of property, plant and equipment is exclusive of
depreciation on right-of-use assets.
Like-for-Like (A4)
Restated(2)
Like-for-like revenue Marketing Services Technology Services
Total
Six months ended 30 June 2024 £m £m £m
Revenue 376.3 46.2 422.5
Impact of foreign exchange (12.0) (1.1) (13.1)
Like-for-like revenue(1) 364.3 45.1 409.4
% like-for-like revenue change (9.1%) (35.0%) (11.9%)
Restated(2) Marketing Services
Like-for-like net revenue Technology Services
Total
Six months ended 30 June 2024 £m £m £m
Net revenue 330.0 46.1 376.1
Impact of foreign exchange (10.5) (1.0) (11.5)
Like-for-like net revenue(1) 319.5 45.1 364.6
% like-for-like net revenue change (6.4%) (35.3%) (10.0%)
Like-for-like operational EBITDA Total
Six months ended 30 June 2024 £m
Operational EBITDA 30.1
Impact of acquisitions -
Impact of foreign exchange (0.2)
Like-for-like operational EBITDA(1) 29.9
% like-for-like operational EBITDA change (30.4%)
Note:
1. Like-for-like is a non-GAAP measure and relates to 2024 being restated to
show the audited numbers for the previous year of the existing and acquired
businesses consolidated for the same months as in 2025, applying currency
rates as used in 2025.
2. Comparative information for the prior period has been represented to
reflect the Group's revised segment structure.
Pro-forma (A5)
Restated(2) Marketing Services
£m Technology Services
Pro-forma revenue £m Total
£m
HY25 Revenue 331.1 29.3 360.4
HY25 Pro-forma revenue(1) 331.1 29.3 360.4
HY24 Revenue 376.3 46.2 422.5
Impact of foreign exchange (12.0) (1.1) (13.1)
HY24 Pro-forma revenue(1) 364.0 45.1 409.1
% pro-forma revenue change (9.1%) (35.0%) (11.9%)
Restated(2) Marketing Services
£m Technology Services
Pro-forma net revenue £m Total
£m
HY25 net revenue 299.0 29.2 328.2
HY25 Pro-forma net revenue(1) 299.0 29.2 328.2
HY24 net revenue 330.0 46.1 376.1
Impact of foreign exchange (10.5) (1.0) (11.5)
HY24 Pro-forma net revenue(1) 319.5 45.1 364.6
% pro-forma net revenue change (6.4%) (35.3%) (10.0%)
Total
Pro-forma operational EBITDA £m
HY25 operational EBITDA 20.8
HY25 Pro-forma operational EBITDA(1) 20.8
HY24 operational EBITDA 30.1
Impact of foreign exchange (0.2)
HY24 Pro-forma operational EBITDA(1) 29.9
% pro-forma operational EBITDA change (30.4%)
Notes:
1. Pro-forma relates to audited non-statutory and non-GAAP consolidated
results in constant currency as if the Group had existed in full for the
period and have been prepared under comparable GAAP with no consolidation
eliminations in the pre-acquisition period.
2. Comparative information for the prior period has been represented to
reflect the Group's revised segment structure.
Adjusted basic earnings per share (A6)
Six month period ended 30 June 2025 Impairment of intangibles
£m Restructuring
Acquisition expenses(2) Share-based payments and other one-off expenses(3)
£m
£m
£m
Reported Amortisation(1) Adjusted
£m £m £m
Operating (loss)/profit (10.9) 22.8 - (0.1) 2.6 2.0 16.4
Net finance expenses (13.9) - - - - - (13.9)
Loss on net monetary position (0.3) - - - - - (0.3)
(Loss)/profit before income tax (25.1) 22.8 - (0.1) 2.6 2.0 2.2
Income tax credit/(expense) 2.8 (6.5) - - 3.4 (0.4) (0.7)
(Loss)/profit for the period (22.3) 16.3 - (0.1) 6.0 1.6 1.5
Notes:
1. Amortisation relates to the intangible assets recognised as a result
of the acquisitions.
2. Acquisition expenses relate to acquisition related advisory fees of
£0.1 million gain.
3. Restructuring and other one-off expenses relate to restructuring costs
of £1.8 million, transformation costs of £2.6 million, reversal impairment
of right-of-use assets of £1.5 million and reversal of onerous lease
provision of £0.9 million.
Acquisition expenses(2) Share-based payments Restructuring and other one-off expenses(3)
Reported Amortisation and impairment(1)
Adjusted
Six month period ended 30 June 2024 £m £m £m £m £m £m
Operating profit (3.7) 23.0 (2.1) 3.8 3.8 24.8
Net finance expenses (12.9) - - - - (12.9)
Loss on net monetary position (0.6) - - - - (0.6)
(Loss)/profit before income tax (17.2) 23.0 (2.1) 3.8 3.8 11.3
Income tax expense 3.5 (6.9) - - - (3.4)
(Loss)/profit for the period (13.7) 16.1 (2.1) 3.8 3.8 7.9
Notes:
1. Amortisation and impairment relates to the intangible assets recognised
as a result of the acquisitions.
2. Acquisition expenses relate to acquisition related advisory fees of
£0.1 million, contingent consideration as remuneration of £0.3 million and
remeasurement gain on contingent considerations of £2.5 million.
3. Restructuring and other one-off expenses relate to restructuring costs
of £1.7 million and transformation costs of £2.1 million.
Adjusted basic result per share
Six months ended 30 June 2025 Six months ended 30 June 2024
Adjusted profit attributable to owners of the Company (£m) 1.5 7.9
Weighted average number of ordinary shares for the purpose of basic EPS 674,189,080 671,233,751
(shares)
Adjusted basic earnings per share (pence) 0.2 1.2
Net debt (A7)
Six months ended 30 June 2025 Year ended 31 December 2024
£m £m
Cash and bank 175.1 168.4
Loans and borrowings (321.0) (311.3)
Net debt (145.9) (142.9)
Lease liabilities (35.6) (42.5)
Net debt including lease liabilities (181.5) (185.4)
Six months ended 30 June 2025 Six months ended 30 June 2024
Free cash flow (A8) £m £m
Net cash inflow from operating activities 34.8 26.1
Employment linked contingent consideration paid - 2.9
Interest and facility fees paid (11.9) (15.2)
Interest received 1.0 1.2
Purchase of intangible assets (0.6) (1.9)
Purchase of property, plant and equipment (1.6) (2.6)
Amounts withdrawn from security deposits 0.1 0.4
Principal element of lease payments (6.5) (6.6)
Other non-cash items 0.7 (1.2)
Free cash flow 16.0 3.1
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