Stagwell Inc. Reports Results for the 3 Months Ended March 31, 2024

Stagwell Inc. today announced financial results for the three months ended March 31, 2024.

FIRST QUARTER RESULTS:

• Q1 Revenue of $670 million, an increase of 8% versus the prior year period.
• Q1 Net Loss attributable to Stagwell Inc. Common Shareholders of $1.3 million versus Income of $1.4 million in the prior year period.
• Q1 Adjusted EBITDA of $90 million, an increase of 25% versus the prior year period.
• Q1 Adjusted EBITDA Margin of 17% on net revenue, an improvement of 320 basis points versus the prior year period.
• Q1 Earnings Per Share Attributable to Stagwell Inc. Common Shareholders of $(0.01) versus $0.00 in the prior year period.
• Q1 Adjusted Earnings Per Share attributable to Stagwell Inc. Common Shareholders of $0.16 versus $0.14 in the prior year period.
• Net new business wins of $66 million in the first quarter, last twelve-month net new business wins of $284 million.
• Q1 Net Revenue of $532 million, an increase of 2% versus the prior year period.
• Q1 Organic Net Revenue increased 2% versus the prior year period, led by 54% increase in Advocacy.

Mark Penn, chairman and CEO, said, "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."

Frank Lanuto, chief financial officer, commented, "Revenue in Q1 grew by 8% year-over-year to $670 million. Cost actions taken in 2023 contributed to 25% growth in adjusted EBITDA or $90 million, representing a 17% adjusted EBITDA margin, an improvement of 320 basis points over the prior year. We are well positioned to achieve our 2024 targets, as we continue to focus on efficiency, especially through the implementation of AI on our shared services platform." 

Financial Outlook

• 2024 financial guidance is reiterated as follows:
• Organic Net Revenue growth of 5% to 7%
• Organic Net Revenue excluding Advocacy growth of 4% to 5%
• Adjusted EBITDA of $400 million to $450 million
• Free Cash Flow Conversion of approximately 50%
• Adjusted EPS of $0.75 - $0.88
• Guidance assumes no impact from foreign exchange, acquisitions or dispositions.

* The Company has excluded a quantitative reconciliation with respect to the Company's 2024 guidance under the "unreasonable efforts" exception in Item 10(e)(1)(i)(B) of Regulation S-K. See "Non-GAAP Financial Measures" below for additional information.

Video Webcast

Management will host a video webcast on Wednesday, May 1, 2024, at 8:30 a.m. (ET) to discuss results for Stagwell Inc. for the three months ended March 31, 2024. The video webcast will be accessible here. An investor presentation has been posted on our website here and may be referred to during the webcast.

A recording of the webcast will be accessible one hour after the webcast and available for ninety days here.

Find the full results here.