S4 Capital slump wipes £5m off Sorrell’s fortune
SIR Martin Sorrell saw another £5m wiped off the value of his stake in S4 Capital after his digital advertising agency warned its revenues would be lower than hoped.
On a bleak day for investors, shares plunged 13.3pc, or 9p, to 58.2p towards a record low.
This means that Sorrell, who set up S4 in May 2018 after three decades in charge at WPP, has seen his paper wealth plunge by more than £70m this year.
The latest profit warning came as S4 said its business was being affected by global economic uncertainty and clients taking longer to commit to spending big, especially in the technology sector.
The cocktail of economic woes saw its third-quarter revenues fall 15.4pc to £211.5m in the three months to the end of September.
As a result, S4 expects its revenues for 2023 to be below last year.
Looking ahead, Sorrell remained upbeat that the final three months of this year will be the strongest quarter for his company. And he pinned his hopes on a brighter 2024, with plans to return cash to shareholders through dividends and share buybacks.
London’s main markets were lifted by a handful of positive updates as the FTSE 100 rose 0.7pc, or 54 points, to 7455.7 and the FTSE 250 was up 1.1pc, or 191.6 points, to 18,037.9.
Among them was Auto Trader after the online car seller reported a record number of buyers. This helped its revenues rise 12pc and profit increased 10pc in the six months to the end of September.
There was also good news for the private equity firm 3i which broke through the £20bn valuation on the back of its investment in the Dutch non-food discount retailer Action. Shares dipped 0.9pc, or 19p, to 2022p. It was also a great session for Lancashire Holdings as it vowed to return £138m to shareholders through a special dividend and share buyback after its premiums written rose 23.2pc to £1.3bn in the nine months to the end of September.
Shares gained 8.2pc, or 50p, to 656.5p.
Investors in Morgan Advanced Materials could breathe a sigh of relief as the company, which makes ceramics for metal smelting factories, said it had recovered from the cyber-attack it suffered at the start of this year.
It maintained its forecasts for revenue to increase between 2pc and 4pc this year after sales rose 2.4pc in the nine months to the end of September. Shares rose 6.2pc, or 14.5p, to 247.5p.
A recovery in travel and increased footfall in airports and train stations helped WH Smith double its profits in the year to the end of August. Shares added 5.1pc, or 60p, to 1249p.
Revenues at Dowlais, the engineering group which was spun off from Melrose and listed in April, rose 4.7pc to £1.8bn in the four months to the end of October.
Its annual results should meet its forecasts even though the UAW strike action in North America is expected to wipe between £30m and £45m off revenue and reduce profit by as much as £15m. Workers are locked in a dispute with carmakers such as General Motors, Ford and Stellantis. Shares fell 1.6pc, or 1.7p, to 104.4p.
And Tate & Lyle produced a sweet update after the ingredients maker’s profit jumped 92pc to £ 130m in the six months to September 30. Shares dipped 0.5pc, or 3.5p, to 652p.
But some updates left investors far from impressed. That included Domino’s following a slowdown in sales in the three months to September 24 compared with the previous quarter. Shares fell 6.9pc, or 25.8p, to 345.8p. Nursing even heavier losses was Wizz Air after narrowing its profit forecast amid worries over flight disruption in the Middle East. Shares sank 9.8pc, or 183p, to 1680p.