The financial update from S4 Capital also said that its operational earnings before interest, taxes, depreciation and amortisation (EBITDA) margin was in the range of 10% to 11%.

The operational EBITDA had improved as a result of significant cost reductions, the company added.

Net debt is expected to be towards the lower end of a range of £180m to £220m, with around £10m of merger payments delayed to 2024.

In November, S4 Capital had warned that its third quarter reported net revenue for 2023 was down 15.4%, like-for-like down 10%, which the company said reflected lower activity in its content and data and digital media divisions.

Responding to the latest estimates for its full-year 2023 financial results, Sir Martin Sorrell, S4 Capital executive chairman, warned that the company did not expect 2024 to show macro-economic improvement, with a knock-on effect on marketing spend.

Sorrell said: “After four years of very strong growth, 2023 was a difficult year impacted by volatile macro conditions and, consequently, cautious spending from clients, particularly those in the technology sector and from smaller project-based assignments.

“Our client relationships remain strong, and we have also managed costs tightly.”

He added that initial indications are for an improvement in performance in S4 Capital’s content practice, reflecting cost reductions, and a broadly similar performance in data and digital media in 2024 compared with last year, as well as a more challenging outlook for technology services.

Sorrell said: “In these unpredictable times, we are focused on positioning the company for medium term growth, improving profitability and returning funds to shareowners.”