Stagwell’s Penn paints a positive picture as growth returns in Q1

Mark Penn’s Stagwell now includes the former MDC, an ad holding company that resolutely failed to make money, alongside his various tech-based companies. After a rocky 2023 the business (which includes noted creative agencies Anomaly and 72&Sunny) is in danger of making money.

Q1 saw a net loss of just $1.3m with an adjusted EBITDA (earnings earnings before interest, taxes, depreciation and amortisation – which can cover a multitude of sins) of a pretty respectable $90m. Organic Q1 growth was up 8% with 5% forecast for the full year.

Tech clients, widely blamed by agency shortfalls in late 2023 and early 2024, seemingly returned for Stagwell.

Chairman and CEO Penn (above) says: “We are on target for 2024 with a return to growth and strong margin expansion led by the double-digit growth of the Performance Media & Data Capability. We see tailwinds of record new business, growth in advertising generally, and a strengthened market position given growing industry accolades for our work.

“We continue to invest in technology with the Stagwell Marketing Cloud setting the pace for innovation and we believe that we will see growth in AI-related digital transformation assignments building in the second half of the year along with a strong advocacy season. At the same time, we are successfully expanding our global presence, and we are seeing that pay dividends with enhanced growth.”

Stagwell recently set up a European HQ in London and Penn says this is helping the company pitch for bigger accounts. Stagwell made a tentative approach for Sir Martin Sorrell’s S4 Capital last year, which was rebuffed.

Ad holding companies sometimes invest in tech and then try to maintain, somewhat unconvincingly, that that is what they’re really about. Penn, at least, is grounded in tech so he may be finding the secret sauce for the expanded Stagwell. May be.