S4 Capital plc (SFOR) Earnings Call Transcript & Summary

So before providing an update on the business and current developments, we'd like to take this opportunity to explain how the formal business of the meeting will proceed, and how you'll be able to vote, our shareowners vote on the resolutions proposed in the notice of Annual General Meeting. The notice of Annual General Meeting was published on the company's website and were sent or made available to shareowners -- all shareowners in accordance with their instructions. I would, therefore, ask your permission to take the notice of the meeting as read. I think that's carried, as there's no dissent. The Annual General Meeting of the company has been called for the purpose of considering and, if thought fit, passing the resolutions, details of which are set out in the notice of meeting, of which numbers 1 to 19 will be proposed as ordinary resolutions, and numbers 20 to 25 will be proposed as special resolutions. An ordinary resolution requires a simple majority of votes to be cast in favor of it, while a special resolution requires a 75% majority. We will be conducting the voting by way of a poll. I will now take a few minutes to explain the voting procedure that will be in use today. Voting on the resolutions is now open. For those shareowners attending online using the online meeting platform called Lumi, the voting icon will appear on the navigation bar. Once you click on this, the resolutions will appear on your screen, along with the for, the against and withheld voting options. Simply select one of these options to cast your vote. If you change your mind, simply select another option. You can change your vote as many times as you wish up until the closing of the poll. Your vote will be submitted when the voting option item changes color, having selected it and a vote received message appears, there is no final submit button as the voting is live. If any person attending the meeting online is having any difficulties with using the platform, there is a user guide that has been prepared that you can access through the platform on the Information tab that should address any questions that you might have. Please note that only shareholders, proxyholders or shareowner representatives may vote. You can vote at any time during the proceedings, until we declare the voting closed. We will close the voting once we have concluded the Q&A section at the end of the meeting. I will give you a clear prompt later in the meeting to warn of the close in voting. We will also take this opportunity for general business questions and discussion. You can start submitting questions now using the online meeting platform, which we will address later in the proceedings. We are now taking general questions from the shareowners. [Operator Instructions] I would like to bring shareowners up-to-date on current developments, and I have to read the statement that was issued this morning on the Stock Exchange at 7:00 a.m. 2019 was a very busy second year for S4 Capital, and the last 3 months have been even more demanding because of the coronavirus pandemic. And more recently, because of the tragic death of George Floyd, which I must say has had a marked impact on our people. I am pleased to say that very few of our people and their families have been infected by COVID-19 or developed serious problems as a result, although a very small number have lost -- have sadly lost family members. We wish them and their families long life and record our thanks to all the frontline workers who have kept us well and safe. As a response to the historic and current crisis around racism in the United States, we have launched a matching donation fund, initially for our people in the United States, and are actively developing diversity and inclusion training programs and specific targets for all our people across the firm although we believe every one of our people should, in their own way be a Chief Diversity Officer, just as they should be a Chief Talent Officer. First, I want to remind everyone, again, of our definitive and differentiated strategy, based on 4 core principles. We are purely digital because that's where the growth is, even more so in a COVID-19 world. In a 24/7, always-on digital world, our business model is to focus on first-party data, which, in turn, fuels our digital advertising and marketing creative content and our digital media planning and buying or programmatic executions. Our mantra or strap line is faster, better, cheaper or alternatively, speed, quality, value, because that's what clients want. Finally, our organizational structure is unitary, with a single P&L, as clients want the best people working on their business, not really caring where they come from. We don't do fragmenting earnouts. Having built out our content practice in 2018 around MediaMonks, and our programmatic and data and analytics practice around MightyHive, also in 2018, we have added 6 content companies and 4 programmatic and data and analytics companies; 2 Caramel Pictures and ProgMedia before last year's AGM, and 8 in the last 7 months of 2019 and first 5 months of 2020. In June 2019, MediaMonks announced a planned merger with Australian-based BizTech, a leading marketing transformation and customer experience company. In August 2019, MediaMonks merged with Amsterdam-based digital influencer marketing agency, IMA. In October 2019, MediaMonks merged with Firewood Marketing, the largest digital marketing agency based in Silicon Valley, that was recently ranked, along with MediaMonks, as one of the fastest-growing agencies by AdWeek, and MightyHive merged with award-winning U.K.-based digital analytics, biddable media and data science company Conversion Works, and a South Korean-based data and analytics consultancy, formerly known as Datalicious Korea, now branded MightyHive Korea. In November 2019, MediaMonks announced the merger with Delhi-based content creation and production company, WhiteBalance, and then with fully integrated agency -- digital agency, Circus Marketing in January 2020 -- finally, in January 2020. Finally, for now, MightyHive merged with Buenos Aires-based Latin American data analytics consultancy, Digodat, last month. All these mergers are being branded under the MediaMonks and MightyHive banners, and in turn, MediaMonks and MightyHive are increasingly and already successfully acting as one in going to market. Since the last AGM in May of 2019, your company has doubled its number of people to 2,550 in 30 countries, and doubled its market capitalization to around GBP 1.2 billion, USD 1.5 billion. S4 Capital has achieved pound, sterling and dollar, U.S. dollar, unicorn status within 18 months of re-listing, and would rank in the FTSE 250 by market capitalization, if it had a premium listing. Despite the catastrophic impact of COVID-19, trading for the first 4 months of 2020 continues to be strong, but understandably below a pre-pandemic budget, with reportable revenues up 68% and like-for-like revenues up over 11%. Reportable gross profit was up over 82%, and like-for-like gross profit, 15%. Pro forma revenue growth was over 13% and gross profit growth, almost 17%. Both revenue and gross profit like-for-like growth rates, again, understandably, were lower in April than in the first quarter as COVID-19 hit the whole of the month in the Americas and EMEA, but like-for-like gross profit remained in positive territory at well over 3%. We do not have our May figures as yet, but early indications are that May will be stronger than April across both our practices and that in June, the pipeline of our content mandatory practice, which is over 2/3 -- the pipeline of our content practice, which is over 2/3 of our revenues and gross profit has started at a higher level than May did. Tech clients, which constitute 53% of our revenues, are still generally outspending consumer packaged goods and fast-moving consumer goods, pharma and retail clients, with both buckets of clients exhibiting some evidence of postponement of spending from the second quarter into the second half of 2020. As last year, but for different reasons, the company continues to invest heavily in human capital in order to maintain the fabric of the company in these difficult times, having dealt with the low-hanging fruit in reducing costs around travel, nonessential business expenses and freelance contracts. As traditional competitors readily admit to pulling their operational levers closed slowly, we want to be in a position to move ahead quickly and aggressively as the lockdowns ease significantly in June, to take advantage of V-shaped and U-shaped recoveries in certain verticals, such as technology, health care, online retail and gaming and home entertainment. This affects the pattern of growth in earnings before interest, taxes, depreciation and amortization early in the year, as the company gears up for an even higher level of revenue and gross profit growth later this year. The company's quarter 1 revised forecast indicates strong performance for the year in comparison to expectations. As we stated previously in our first quarter trading statement, we are confident that we will be able to deliver sector-leading, double-digit like-to-like revenue and gross profit growth for 2020, along with a reasonably strong operating earnings before interest, taxes, depreciation and amortization margin. We also continue to believe that we still have a fighting chance of achieving our 3-year plan for 2020 to 2022, which calls for a doubling of the company organically, at both top line and earnings before interest, taxes, depreciation and amortization levels. We always knew that our people, being digital natives, would adapt effortlessly and productively to working from home. And as a result, we are starting to adopt a hybrid model, which accommodates those of our people who want to work more from home and who want to commute more flexibly. We have already terminated a number of office leases, which will enable us to integrate our operations even faster than we originally thought. The company's cash flow remains strong, ahead of various stress test scenarios, with a continuing average net cash position, despite anticipated merger payments. Your company will continue to conclude strategic mergers, but without compromising the strength of its balance sheet or liquidity, at least until the threat of COVID-19 recedes. Having achieved brand awareness and brand trial over the first 2 years, our focus remains on broadening and developing and deepening existing client relationships and conversion at scale. Our 2 biggest clients have achieved whopper status, i.e., 5% of revenues, but we still search for bigger and deeper relationships. Notable recent client wins include integrated content and programmatic assignments, and they number PayPal, Quibi, Twitch, Domino's, CEMEX, Fuji Television, Dole Food Company, AkzoNobel, Mondelez, Gympass, Havianas and Ace Hardware, amongst others. We eagerly await the result of 2 major pictures, one global and one regional, both of which are potential whoppers. Geographically, we have added offices in South Korea and Spain since the last AGM, and Germany remains the last geographic priority, at least for the moment. We are increasingly building our third pillar, first-party data, around our data and analytic capabilities in our programmatic practice, and you can expect further expansion there as well as build-outs of our capabilities around the key tech platforms. Finally, I am delighted to say that we have added considerable non-executive talent to our Board since the last AGM in the form of Australian, Elizabeth Buchanan; Hong Kong Chinese, Margaret Connolly; and Japanese, Naoko Okumoto. We now have 7 nonexecutive directors with room, probably, for one more. So that's the statement that we issued this morning. We now have with me as speakers to present to you, our shareowners, a business update, Peter Rademaker, our CFO; and Scott Spirit, our Chief Growth Officer, who will lead off, talking about the business financially and strategically and structurally. And then Wesley ter Haar and Victor Knaap, the 2 founders of MediaMonks, will present our content practice. And Pete Kim, the Founder -- co-Founder with Chris Martin of MightyHive, will present our programmatic practice -- our data and programmatic practice. We'll then switch to Q&A from shareowners. So over to you, Peter and Scott.

Yes. Thank you so, Martin. I will start with a short update on 2020 first 4 months. But before that, I will, shortly, address the financial performance of 2019, and we consider, since 2019 was our first full financial year since we started in May 2018, as a very successful first full financial year of S4 Capital as a group. And in 2019, our billings were GBP 455.8 million, and on a pro forma basis, over GBP 0.5 billion, GBP 513.2 million. Our revenues were GBP 215.1 million, up with 292% from GBP 45.8 million last year, again, that was a 7-month period. And on a like-for-like basis, more importantly, the revenue was up 41%. And on a pro forma full financial year basis, 37%. Our most important measure, being gross profit, was GBP 171.3 million, up 361% from GBP 37.2 million. And on a like-for-like basis, 44% up, and on a pro forma basis, 39% up. Our EBITDA, our earnings before interest, tax, depreciation and amortization, was GBP 33.4 million, up 612%. And like-for-like, 51% up. And on a pro forma basis, 47% up. Our operational EBITDA margin, 19.5%, 6.9 margin percent on 2018. And on a like-for-like basis, it was 18.6%. And on a pro forma basis, 20.1%. Our operating loss was GBP 3.8 million. But that operating loss includes adjusting items, sort of one-off items of GBP 35 million, consisting of acquisition expenses, amortization on our intangibles and share-based compensation, versus an operating loss of GBP 8.5 million in 2018. And on a pro forma operating profit of GBP 2.5 million for 2019. Results before income tax was GBP 9.2 million loss, which includes, again, the adjusting items of GBP 35 million, what I just referred to, versus a GBP 9.1 million loss in 2018 and a pro forma result before income tax of GBP 2.8 million of loss. The results for the period was GBP 10 million loss, which includes, again, the adjusting items, but then after taxation versus GBP 8.1 million loss in 2018. And on a pro forma basis, the result was a loss of GBP 5.7 million. Our adjusted basic net result per share was 5.2p versus 1.0p in 2018. And our basic and diluted net results per share was 2.7p loss versus 3.3p loss in 2018. And our pro forma adjusted basic net result per share was 1.3p loss. And our year-end net cash was 20 -- almost GBP 24 million, GBP 23.7 million to be precise, including the 42% -- GBP 42 million, a loan that was drawn down to fund the combination with MediaMonks in 2018. And on the next page, you will see our trading update. So Martin already referred it to earlier, we've made a comparison for Q1 as well as the year-to-date of April, and our reported revenue for Q1 was 73% up to GBP 71 million. And for the first 4 months, it was 68%, up to GBP 94.4 million. Our gross profit was up in the first quarter with 85% to GBP 60.7 million. And for the first 4 months, it was 82% up to GBP 81 million. Like-for-like revenues, 17% up in Q1, and 11% up in the first 4 months. And gross profit was 19% up in the first 3 months and in the first 4 months, 15%. Pro forma revenue, again, as consolidated for the full year, was up with 19%. And on a pro forma basis for the first 4 months, 13%. And finally, our gross profit pro forma basis was 22% up. And for the first 4 months, 17% up. For the full 4 months, our cash flow remains very strong, with net cash balances of most of the period in a positive way. So net cash value, we are carrying currently net cash balances. And as Martin indicated, for the 2020 full year, we see sector double-digit -- sector-leading double-digit growth on a like-for-like revenue and gross profit basis, and reasonably strong EBITDA margins. And finally, I would like to share 2 slides with you on the actions, the precautionary actions, we took to mitigate COVID-19 impact on cost and liquidity. As a first starting point, on costs, we have taken several measures in our group. And a first point is the 50% reduction in compensations for the executives and the Board, as from April 1, 2020. We have been reducing and terminating, in the meantime, office leases in a number of cities, which is accelerating integration. We're sort of still thinking how we will go back to work from home, but what we see is that most people in our company, or at least a lot of people, also in the next coming months, will want to continue to work from home, or at least partially, and that's as a result of we took these measures of terminating some of their office leases. We took other OpEx reductions, such as travel and entertainment, marketing, promotions and bonuses. And as Martin indicated, hiring reduction and scaling down of the number of freelancers, and adjusting, basically, constantly people to client demands where necessary. And with our current measures, our cost measures, in 2020, the impact will be GBP 18 million on savings, which is approximately 10% of our total cost base, excluding cost of goods sold, 10% on last year's and approximately 7% cost saving on this year's numbers. And my final page on liquidity. Again, our precautionary actions, like Sir Martin already indicated, we took -- we made a -- we prepared a couple of scenarios in our stress testing, that's one thing. But early March, we drew down our revolvers. It was not necessary at that time, but we wanted to be better safe than sorry, and have availability of our revolver. So we fully have drawn down. However, it's not needed because we have been remaining in a cash positive balance in the first 4 months, and we are monitoring cash on a daily basis of all entities. We have an increased activity on receivable collections, and our provisions are still adequate. We have currently or so far, no government grants -- government loans have been obtained. And basically throughout the 30 countries where we're operating in, whether we see ability or the possibility to delay some of the tax payments, like payroll tax or corporate income tax or value added tax, we have taken these measures, or we have made use of that possibility. But furthermore, no subsidies or other stimulus taken from governments. And finally, also on liquidity, in order to protect liquidity, we have been waiving our cash bonuses 2019 for the executives, and replacing with shares with a 2-year lockup. That was my short summary. So over to you, Scott.

Great. Thanks, Peter, and welcome, everyone. Good evening from Singapore. So I'm going to take a few minutes to take you through the S4 Capital strategy, and why we feel it positions us well going forward. So if we could go to next slide, Slide 9. So I know you're familiar with our 4 key principles, which Martin just ran through in the statement. And these are 4 things that we believe position us very well for growth. So just as a reminder, firstly, we're purely digital; secondly, we have 3 main practice areas, so data, digital content and programmatic, our Holy Trinity of service offering; thirdly, our mantra of faster, better, cheaper, or speed, quality and value, which is our go-to-market strategy; and finally, we do all of this under a unified structure without silos or fragmenting earnouts. Next slide. So this chart really illustrates precisely why we focus on being purely digital. So it illustrates media spend projections for 2020. It's from WARC, which is the World Advertising Research Center. And the dark bars, you can see, are predictions for growth they made in marketing spend pre-COVID, and the lighter color bars reflect the re-forecast they made post-COVID. And as you can see, all the growth is in digital media categories. And there are significant declines predicted in traditional categories, such as TV and outdoor. And this has only been exaggerated by COVID. Indeed, COVID has accelerated many of the digital trends we are already seeing. So it's providing a giant leap forward we feel for digital consumption and adoption in areas like online learning, communication, social networking, gaming, entertainment and others. Satya Nadella, the CEO of our client, Microsoft, said, "We've seen 2 years of digital transformation in just 2 months." If we go to the next slide. This chart further illustrates this trend, where we're focused on what's happened in e-commerce. It represents the percentage of retail sales in the U.S.A., which are e-commerce as opposed to traditional retail. And you can see the steady growth from 2009 to 2019, which was already a strong trend and a trend that benefits in our business. But in the past few months, that penetration has almost doubled from 16% to 27%, a huge jump. Now certainly, many of these lockdown-inspired peaks in digital behavior that we've seen will recede a little as the lockdowns end, and we're allowed to go outside and reengage with the physical world. But these leaps forward, we believe, will remain with us. And the conversations we're having with brands are all around how they can accelerate their own digital transformation plans and reach more consumers through digital marketing, and they're looking for partners like us to help them get there faster, better and cheaper. Slide -- next slide, please, 12. So at S4 Capital, we see us -- very much see ourselves as the service layer to the big media platforms and e-commerce platforms, and the marketing and advertising technology and software companies. Now the reality is, as a modern CMO, you'll probably have relationships with most of the companies on this slide, but these companies provide products and technologies. That's what their valuations are based on and their business models. They provide no or very limited services. And as such, they've developed and nurtured ecosystems of service partners. Now our objective at S4 is very clear, we want to be the most nimble, agile, creative and strategic partner for these companies. And we want to help create success stories for our mutual clients. Now the partnerships we build with these companies are crucial to our success, and we already have deep symbiotic relationships with most of them. Google is a great example. It's our largest client, accounting for almost 1/4 of our revenue, and we work with them across all practice areas of data, creative and programmatic. But that only tells half the story. MightyHive is one of the leading accredited practitioners across Google's entire product range. So that's GMP, search, cloud, analytics, et cetera. And a significant portion of their business, both enterprise and SMB, is referred directly to us by Google. Next slide, please. Now this chart's lifted directly from the latest Jefferies analyst reports on S4. And Becky Lane, the analyst there, who recently initiated coverage on S4 points out, and I quote, "Any correlation of S4's share price with that of the holding companies was short-lived. We highlight increasing correlation with Accenture, a consulting peer, and more importantly, the tech platforms, Google and Facebook." Next slide. And now that correlation is, certainly, driven by the fact, as I explained earlier, that technology companies are our main clients and partners at S4. And they represent over 50% of our revenue, as you can see from this chart, and all the major tech companies are our clients. And their strong top line growth, and their projected V-shaped COVID recoveries, in many cases, feed further opportunities for us to expand S4. We've got limited exposure to categories like auto, or travel or luxury, which have been most affected by COVID, and which will have more L-shaped or U-shaped recoveries. Next slide. Agility and speed are at the heart of our model and our competitiveness and how we deliver services to our clients and partners is significantly different to the traditional agency service model. The way clients engage with agencies is evolving, and we view it as a spectrum. On the left-hand side, you have that traditional model of clients fully outsourcing their business to an agency, and this is the model that the holding companies rely on, but what we are seeing is that, for diverse reasons, spanning a desire for transparency or data privacy, wanting direct relationships with the tech platforms and ultimately wanting work to be faster, better and cheaper, clients are increasingly taking more control and moving along this spectrum and exploring new engagement models, such as hybrid or embedded models, which is not simply placing staff on site, it's an entirely different integrated way of working with the clients' marketing team. And at the far right of the spectrum, you have clients fully in-housing certain capabilities. Now at S4, we have a flexible approach and a business model that supports clients wherever they want to be on the spectrum. We don't have the burden of incumbency, which allows us to be truly agnostic and consultative in how we engage with clients. Main housing continues to be a major topic in the industry, and several recent surveys, including the one quoted here from MediaLink, have shown that this is a trend which continues to dominate client thinking. And this is also evident in the recent comment here from the ANA President, who said that COVID has enhanced the in-house environment for many marketers. Our unitary structure at S4 really allows us to operate anywhere on the spectrum. And the quote here, you see on the right, from a leading Fortune 500 retailer, "It's typical of the feedback that we get versus the traditional siloed holding company approaches." And just last week, we won an additional brand from one of the world's leading FMCGs, taking over from a holding company, and the client's feedback was that we will be the agency that bring the change. Now with that, I hand you over to Victor and Wes, who are going to talk about the content practice.

Great. Thanks, Scott. Wesley ter Haar here, one of the founders of MediaMonks. I'll start with an update on the content practice, talk a bit about our focus a bit more context around the amazing teams and talent that have joined through mergers over last year, and then a bit more detail on the exciting news of our growing clients and growing client base. And then Victor will jump in with some additional context on our response to COVID-19. So we go to the next slide to really just hit, at a very top level, on our focus. We look at the end-to-end consumer journey. It's all about delivering best-in-class creativity and content across all touch points that connect consumers and corporations and what we broadly refer to as digital. And we're doing that in a way that's more native and it's more natural, and that's very connected to what Scott just shared, which is we're setting ourselves up to be the key service layer to the technology partners and platforms that are really driving the ongoing digital disruption of industries and the virtualization of experiences. So that's our key focus. If we go to the next slide, I'll quickly pick out 2 pieces of work that I think are a great example of that. OMEN, which is HP's gaming brand, really, really leans into consumer journey thinking. There's a lot of sort of paid advertising fit for format across channels, including influencer marketing that we use to drive people down the funnel to the dot-com. Dot-com has some amazing UX/UI work deeply integrated with sales funnels and flows, and also connected to the Dolby experience marketing cloud. So a really good example of end-to-end journey paid advertising, optimized for channels, great experience, on site, connected to marketing tech ad scale. Another great example, if we go to the next slide, is some of the work we've been doing for Google. To Scott's earlier point, Google is a big client of ours. I really like the series of digital demos we're doing at the moment. I think as a bit of context, physical events, of course, no longer possible due to COVID, so we're seeing a lot of experiential move into digital spaces. And to me, what's exciting there is it sort of hearkens back to the original intended MediaMonks, which is this idea that we can really create beautiful, tactile, interactive experiences that combine fun and functionality to get people excited about products and services. This is for Google Anthos, where we have about 5 or 6 of these demos coming out really soon, and I think all that work is virtually exciting and really fun. If we go to the next slide. We heard from Martin hit on this earlier, but just to go through the partners that have joined recently. We have best-in-class influencer marketing with IMA. We have a completely different, more collaborative agency model with Firewood, also some great strategic jobs and business-to-business focus. We have this best-in-class at Dolby experience cloud, and it's already deeply integrated with a lot of the works we're doing, including OMEN, the work we just looked at. We have WhiteBalance, which really opens the Indian market, but also just great creative and content capabilities for our global clients. And then, Circus last but not least, end-to-end social capabilities and really great data-driven creative jobs. So all of this together is really exciting. And it's exciting from a few different angles. It helps us build the end-to-end consultative practice that we've mentioned. It means we can do really amazing work across all of these touch points. But it also means we have some really, really ambitious, really strong entrepreneurs joining the team, which is very different to the more traditional networks and legacy agencies' needs. We have more entrepreneurial power as a unitary structure. And then they, of course, have built really strong teams, and amazing cultures, over the years that are now integrating with the rest of the group. We're already seeing a lot of upside to those integrated offerings, and I'm excited about what that will bring this year, in the following years. If we go to the next slide, happy to report that we continue landing new clients. Words from Martin called out some of these very diverse set of clients, which I think is exciting. Shows the go-to-market strategy working across a really broad sets of industries. And then, of course, we keep growing our existing client base, opening up new streams of work, opening up new types of work and really integrating all of these additional teams, additional talent, into our existing client portfolio to win more share of wallet. That's a quick update. I'm going to hand over to Victor to talk a bit more about our response to COVID-19.

Thank you, Wes, and thank you, everyone, for joining our AGM call. Obviously, we received a lot of questions from investors, monks and clients around the world on how we deal with COVID. And although COVID doesn't really change our longer term focus, like Wesley just explained, it definitely impacted the speed of the transformation at our clients. Digital products like DTC, direct-to-consumer, e-com and the role of digital for retail are now top of mind, and at the biggest priority of the brands we work with. And COVID also impacted our business in the first and second quarter of 2020. I will run you through a couple of slides explaining what we have seen happening and how we responded to it. Next slide, please. So the business impact, we've seen a couple of things happening. So we saw a soft Q1 because of Chinese New Year, followed by the lockdown in APAC, and we've seen some work being canceled on delay -- or delayed in film, experiential, influencers, some of our consultancy work, but obviously, our success is depending on our clients' success. So our client portfolio, although it's relatively small in travel and retail, are, obviously, affected by COVID. The first thing we've done is we try to act as quickly as possible and minimizing travel and moving our monks to working from home environment. And that was -- that transition was made fast and smooth, and that's because of our tooling and digital mindset we have in our company. We have a low number of cases, and confirmed cases, and we're now fully focused on, although we didn't have a big impact, or sometimes even a more positive impact on productivity of our staff, we're now fully focused on mental health across teams, across the globe. And we're now 10 weeks in from a European perspective, or from a northern American perspective. And we actually see a pretty strong pipeline of commercial opportunities. And there's a couple of things I want to show you, especially in animation and physical to live streaming across events and trade shows. Next slide, please. So there's 3 major topics that we tried to solve during COVID. It solved now. There was a lot of need of our teams, but especially at our clients, for solutions that can implement it directly. So we get it a 100-monk strong squad team that came up with solutions. How to do production during COVID? What's the tone of voice during COVID? How do I shoot film? How do I turn my brand around by implementing quick commerce? And we've sent that around in the last few weeks to all of our clients and all of our teams, and it already resulted in a lot of great work that came out of it, that as well changed the tone of voice of our advertising as well as the digital product that is attached to it. So we selected a couple of cases from HP, Nike, Toyota, Facebook, ABI, NFP live streaming platform they signify, which I will show you in the next sheets. And most importantly, we've seen a lot of conversation with the strategic next steps. What are we going to do next when a 1.5 meter society becomes the new normal? And especially, we're partnering up with tech and media partners that we have, like Adobe, Snap, Unreal, YouTube, et cetera, et cetera, to come up with new solutions. Next slide, please. So solved the now. We made a great case together with Nike. So instead of people going to the gym, how do we get the gym into your house? Secondly, is how do we shoot film in a time during COVID? So safe, hygienic and fully equipped with clients being remote. Next slide, please. And tone of voice, like saying things differently in this time is going to be -- is increasingly more important. So there's 2 great campaigns, one Toyota campaign we launched or wanted to launch connected to the Olympics, is now a campaign that helps people to be motivated and to stay fit during COVID, by the same athletes that we were normally using during our campaign at the Olympics. And I think that Facebook takes a very good role in helping out small and medium-sized businesses by helping -- by giving tips and tricks via video, how to do more business on the Facebook platform. Next sheet, please? And last but not least, so we spent an enormous amount of time on solving the now. The next steps are more strategic is how can we help set up workshops, strategy sessions and quick roads into commerce, virtualized events, and how brands need to communicate in this time after COVID? Thank you very much. I would like to hand it over to Pete.

Thank you, Victor. Hello, everyone. My name is Pete Kim, I am the CEO and co-Founder of MightyHive, and I'll take a few moments here to briefly discuss the data and programmatic practice of S4. Next slide. The past year has been one of tremendous growth for our data and programmatic practice, scaling our presence globally. We more have than doubled our headcounts, and have expanded our office counts to over 25 globally. We welcomed a number of companies, as Sir Martin mentioned. And really, I think the theme -- one of the themes here was the expansion of our global data capabilities, where we are really focusing on helping marketers to expand and implement their data strategies for a changed world. We're seeing great success across the board on this, but one of the places where we're seeing the most notable success is in our in-housing practice. We note that in a recent global awards competition, 2 of the 5 nominees were for best global in-house media operation, where MightyHive clients and Bayer Pharmaceutical actually won. Next slide, please. From an M&A perspective, as was mentioned, we have made 3 acquisitions in the last few months. Conversion Works, Datalicious, now -- formerly known -- a company formerly known as Datalicious South Korea as well which is now operating under the brand of MightyHive Korea and Digodat. All of these are data-related acquisitions, which are expanding our data capabilities globally. Next slide. As I mentioned, our footprint continues to grow with 25 offices globally, over 450 employees. And as you can see, we are very well suited indeed in order to support a global client base. Next slide. As we have grown our footprint globally, as you might expect, our client roster has grown as well. We continue to win business both in landing new clients and expanding or upselling our clients once they have had initial success. And we are seeing great momentum in both of those areas, and really are excited about the work that we're doing with them every day. Next slide. Here are just a few of the people that we have added to our executive ranks over the last year, as you might expect, during a time of growth, leadership is more important than ever. And we are very lucky indeed to welcome these talented folks to the S4 family. In the next few slides, next slide, please, we can see a sample of the COVID-19 responses that we sent out to our clients and potential clients in the early days of the pandemic. And it just shows you the type of thinking that we have had during these times, trying to help our clients and potential clients to really survive and thrive in a very troubling time. And so on the first slide, the executive summary here. On the next slide, you'll see our overall stance on this, talking to which types of clients are out there and how they should consider their strategies, depending upon where their verticals are trending in the current times. You can see that there is actions immediately for Q2 becoming more efficient, doing more with less and then really kind of creating a bifurcated plan for a rapid recovery or for a longer downturn. Next slide. This -- on this slide, we have a list of potential actions that we can do specifically for our clients. I'll draw your intention to these 3 at the bottom, preparing for growth, where we have seen a specific and huge amounts of growth inside of first-party data collection as well as platform reviews, and just really making sure that people are ready on the data fronts in order to embrace change and to really take advantage of all the opportunities that are available in the coming months. On the final slide, we see the COVID-19 command center, which is just one example of the types of things that we've been able to do, which is really rapidly creates a media dashboard that helps marketing leaderships to really understand what's happening in these critical times, to keep a finger on the pulse and to get -- and to really have information flow quickly and easily to make great decisions when they are most important. The time required to do this is just 4 to 6 weeks, at a very modest cost for the benefit that was gained, and we saw great adoption and response from our clients. And indeed, won new clients using tactics like these. And with that, I will turn it back over for Q&A.

Thanks very much, Pete. Big thank you to Peter, to Scott, to Wes, to Victor, and Pete and his partner, Chris, for all their efforts over the last year. As you see in the recap over the last half an hour or so, we've made great progress, and I'm sure -- we're sure, there's more to come. So thank you. And to thank all of our now 2,550 people around the world, some of whom, I think, will be listening to this call too. So now I want to move finally, before the vote, and I'd like to remind you all, the shareowners, proxyholders, et cetera, to cast your vote in accordance with the instructions given at the start of this Annual General Meeting. And if you've not already done so, please do. We'll be concluding the meeting after the Q&A.

So at the moment, we have no questions received from online, but I received this morning by e-mail 2 questions from a shareholder, Oliver Hughes, who was unable to access the Lumi app to register his questions. And he asked 2 questions, which I'll try and answer. The first is as follows. With the current market capitalization of nearly GBP 1.2 billion, which could currently place the company, he says in the middle of the FTSE 250 index, it would place us actually at about, prior to today, about 235. So we've made great progress entering the indices really or becoming part or comparable to the indices only on September 18, 2018. He says, does S4 Capital intend to move up into the mid-cap index? Would S4 consider a dual listing on the NASDAQ composite, where most of its geographic business are generated from? Just a couple of observations on that. First of all, as I said, we'd be not in the middle of the FTSE 250 Index. Currently, we'd be around position 235. To my knowledge, there is no mid-cap index. Obviously, we have firm -- we have objectives. We'd like the company to grow significantly, and move up that index or that comparable index. Would we consider a dual listing? In due course, if we were to continue to grow in the U.S., which we think we will, that might become a possible alternative. Companies such as ours, tend to have a better valuation, actually. Tech-orientated companies have a better edge, you see it even with the ad holding companies, are valued more highly on the U.S. exchanges than the European ones. But we'll have to see how that goes. That's not only our current intention, we have a standard listing on the London Stock Exchange at the moment, not a premium listing, which is what we are very content with at the moment. I would just add, currently, we're about 70% Americas, that's North and South America, about 20% Western Europe and EMEA, including Africa and the Middle East. And we're about 10% Asia Pacific. Our geographical ambition is to be 40, 20, 40, because we see great potential in Asia, where both Scott and Michel de Rijk are based in Singapore. So that was his first question. His other question was, what are S4 Capital's thoughts on shareholder distribution for the near future? Before COVID, we did indicate last year that the Board was -- the Board decision was considering possible distributions. But I think we should emphasize that, given the growth rate of the company, which even in a COVID world has been very significant, as you've seen from the first 4 months of the year. But we really regard investment in our own business as the best use of funds. So they might, in the fullness of time, be nominal dividends. But as a growth stock or growth company, very focused on top line and strong margin development as well, I think probably the most useful use of our free cash flow, which, as Peter said, is considerable and remains so, even in COVID, is generating growth inside our business. So with that, let me just check whether there have been any other questions. No, there have been no more questions. So ladies and gentlemen, I now declare that the poll is now closed, and the provisional results should be up on the screen in a second. All resolutions have been carried by considerable margins. Here are the first 16 resolutions. You can see the votes for, the votes against and those that were withheld. And then if we could show the other resolutions, and how they are carried. So these are resolutions. These are the specials, from 17 to 25, again, passed. You can see the votes for, against and withheld. These results will be available on our website in due course. That concludes the meeting. We've been going for about 54 minutes. I want to thank my colleagues. I thank my fellow directors for being on the call. And if any of you have any other questions at any time, by all means, e-mail me at [email protected]; or Scott, at [email protected]; or Peter, same address, [email protected], and we'd be delighted to answer any questions you have. So thank you, once again. Thanks for attending, and we look forward to seeing again when we present our half year results, probably end of August going into September. So we wish you all well, stay safe. Stay well and we look forward to seeing you again soon. Thank you very much.