Accounts delays unacceptable, says Sorrell

SIR MARTIN SORRELL has branded his company’s decision to twice-delay its accounts as “unacceptable and embarrassing” and vowed to rebuild trust after the advertising business lost nearly £1bn in value.

S4 Capital, the digitally focused venture forged in the wake of Sir Martin’s acrimonious departure from WPP four years ago, was blocked from publishing its annual results in March because auditors at PWC had not completed their work on time.

Investors were spooked, with shares plunging nearly 36pc to 310p on March 30.

Finally revealing its results yesterday, S4 said the factors that prompted the delay included control weaknesses, staff turnover and a lack of detailed documentation relating to revenue and the cost of sales.

Sir Martin said the issue was partly caused by S4’s fast growth rate that meant the business had become more complex.

“We cannot – and I cannot – absolve ourselves from the responsibility. We have to take responsibility for it,” Sir Martin added.

“And I have to build trust and confidence. It is not from ground zero. It’s a company with a market cap even now of about £2bn. So we have to build again.

“It has been a pretty torrid time over the last seven weeks ... but we are over the hump now.”

Asked how S4 Capital regains trust, he responded: “By performing: simple”.

S4’s revenues doubled to £687m for the year to the end of December, while profits grew by 62pc to £101m dur- ing the period.

However, the business posted a £56m loss on a pretax basis, compared with a £3.1m profit the previous year. Shares rose 9.8pc to close at 357.8p.