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Interim Results

ITV on track despite fall in H1 profits

26 July 2017 07:24

ITV's pre-tax profits fell to £381m in the six months to the end of June - down from £425m last time.

Total revenues of £1,697m were down from £1,712m a year ago but the group said its results were very much as it anticipated and its guidance for the full year remained unchanged.

Executive chairman Peter Bazalgette said: "Total external revenue was down 3% with the decline in NAR partly offset by continued good growth in non-advertising revenues, which is a clear indication that our strategy of rebalancing the business is working.

"We are confident in the underlying strength of the business as we continue to invest both organically and through acquisitions.

"ITV Studios total revenues grew 7% to £697m including currency benefit. ITV Studios adjusted EBITA was down 9% at £110m.

"This was impacted by our ongoing investment in our US scripted business and the fact that the prior year includes the full benefit of the four year license deal for The Voice of China.

"We have a very strong pipeline of new and returning drama and formats and we are building momentum in our US scripted business.

"We continue to grow our global family of production companies and in H1 we further strengthened our international drama and format business with the acquisition of Line of Duty producer World Productions in the UK, Tetra Media Studio in France and Elk Production in Sweden.

""The Broadcast business remains robust despite the 8% decline in NAR caused by ongoing economic and political uncertainty with Broadcast & Online adjusted EBITA down 8% at £293m.

"On-screen we are performing well. To the end of May our ITV Family share of viewing grew although we ended the first half flat as June last year included the benefit of the Euros.

"ITV continues to deliver the mass audiences demanded by advertisers as well as delivering the key target demographics. ITV is the only channel to deliver a commercial audience over five million and Love Island demonstrates that young viewers engage in great TV content.

"Online, Pay & Interactive grew revenues by 5% to £112m with double digit growth across Online and Pay. Online viewing was again up strongly at 34%. We continue to grow our digital capabilities and invest in the ITV Hub, ITV Hub+, BritBox US, our SVOD joint venture with the BBC and Cirkus, our SVOD proposition in the Nordics and Germany.

"Looking ahead our guidance for 2017 remains unchanged. ITV Studios has already secured 85% of expected full year revenues, over £100m more than this time last year and is firmly on track to deliver good organic revenue growth.

"ITV Studios adjusted EBITA will be broadly flat year on year impacted by continued investment and the timing of programme deliveries. We anticipate further good growth in Online, Pay & Interactive driven by VOD and Pay.

"We expect ITV Family NAR in Q3 to be down around 4%, again impacted by wider economic uncertainty and over the full year we expect to outperform the TV advertising market.

"We see opportunities to continue to invest in growing an even stronger and more resilient business. The strength of our balance sheet and healthy cashflows allow us to do so while delivering sustainable returns to our shareholders.

"The Board has declared an interim dividend of 2.52p, an increase of 5%, reflecting our confidence in the underlying strength of the business."

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