System1 claims it ‘hasn’t scratched the surface’ with bumper results

Ad testing firm System1 pointed to the 260 clients it had won in the past year as being the driving force behind big climbs in revenue and profit in the past year and said it “hadn’t scratched the surface” when it comes to growth.

Overall revenue at the ad company, which helps some of the world’s largest advertisers test their adverts’ effectiveness before they are released, rose by 28 per cent to £30m in the year ended 31 March.

This was despite revenue from its consultancy division dropping from £6m down to £5.2m; a fall of 13 per cent.

The growth, the firm said, was largely down to a 44 per cent rise in the number of clients it works with, including five of the top 10 advertisers in the US and seven of the UK’s top advertisers.

System 1‘s profit grew accordingly, up from £400,000 in FY 2023, to £2m; a rise of over 400 per cent, albeit slightly lower than forecast.

Meanwhile, adjusted earnings before interest, tax, deprecation and amortisation (EBITDA) grew 175 per cent to £4.4m at the AIM-listed firm.

Commenting on the results, System1 CEO James Gregory said: “Our success last year was underpinned by 260 new client wins and our scalable growth model. In the coming year we will step up investment in attracting, winning and retaining customers in order to continue our growth trajectory.

“The new financial year has started strongly, particularly in the US, and we anticipate an increase of 50 per cent in Q1 total revenue with platform revenue up 70 per cent versus Q1 FY24. As a result we continue to expect strong double-digit revenue growth for the financial year as a whole.” 

The firm’s solid growth did not prevent it from being bullish about its future, as it looks to “spin [its] flywheel even faster” in FY 25. It expects a 50 per cent growth in Q1 revenue, with growth from its main testing platform up 70 per cent versus Q1 last year.