S4 Capital (LON: SFOR), the digital advertising and marketing technology group founded by Sir Martin Sorrell, saw its shares jump on Wednesday after half-year results showed record operational EBITDA, sharply lower debt and its first-ever interim dividend.
The shares traded at 43.9p in early trading, up 11.99% from Tuesday’s close of 39.2p, having opened at 39.0p and touched a day high of 44.0p. That puts the stock close to the top of its 52-week range of 15.30p to 46.57p.
S4 Capital’s interim results, released before Wednesday’s market open, showed net revenue down 6.2% to £308.0m (4.7% like-for-like, stripping out currency and disposal effects). It is the latest in a run of periods in which top-line demand has weakened even as the group’s cost base has been cut back.
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That cost discipline, as reflected in the results, drove operational EBITDA, the company’s adjusted earnings measure, to a record £38.0m, up 82.7% from £20.8m a year earlier, with margin rising 600 basis points to 12.3%. Net debt fell to £66.3m, equivalent to 0.7 times pro-forma EBITDA and comfortably inside its covenants, from £145.9m a year earlier. That improvement funded a further €40.1m buyback of its Term Loan B bank debt, cutting the balance to €249.7m from an original €375m, and a maiden interim dividend of 1.35p per share, half of adjusted basic earnings per share of 2.7p.
Sir Martin Sorrell, S4 Capital’s executive chairman, said: “We now expect 2026 like-for-like net revenue to be down mid-single digits, with operational EBITDA remaining at current analyst consensus level of £85 million and operational EBITDA margin to increase by 140 basis points.” The company also narrowed its year-end net debt target to between £50m and £80m, and said adjusted earnings per share should come in above consensus.
