S4 Capital scales back revenue guidance after tough first half
By Benjamin Chiou
Date: Monday 15 Sep 2025
(Sharecast News) - Media company S4 Capital has cut its full-year sales targets after a challenging first half, but said it is considering raising its dividend if the second half picks up as expected.
The company, which confirmed last month that it was in discussions about a potential merger with MSQ Partners, said that full-year like-for-like revenues are now expected to fall at a mid-single-digit percentage rate, compared with guidance in June for a low-single-digit decline.
Guidance for profits - operational EBITDA is expected to be broadly similar to 2024 - was left unchanged and is predicted to have a greater second-half weighting due to the timing of significant new business wins and cost reductions.
Net revenues for the six months to 30 June were down 12.7% £328.2m, falling 10% on a LFL basis, which S4 Capital said reflected the impact of macro conditions - specifically the uncertainty surrounding eventual tariff levels - on client confidence.
"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," the company said.
Operational EBITDA was down 30.9% at £20.8m, though in line with expectations, the company said.
S4 Capital, which paid its maiden dividend last year, is not proposing an interim dividend but will consider an enhanced final dividend for 2025, "if the improved second half performance and liquidity targets are delivered".
S4 Capital said on 11 August that it had received a proposal from MSQ Partners, which is majority owned by One Equity Partners, about a "possible combination", though talks were at a very preliminary stage. If agreed, the deal would be structured as an acquisition of MSQ by S4 Capital.
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