Improved Advertising Revenue Drives ITV Profits Up 59%
Commercial broadcaster, ITV, has today announced that pre-tax profits have jumped up 59% to £132 million in the first half of this year, driven by an improvement in advertising revenue which grew by 4% for the group.
Although significant improvements were seen across the board for ITV, the biggest achievement comes from its news division and digital channel, ITV2, which saw advertising revenues jump 68% from January to June 2004, citing the greatest performance for the group since the height of the dotcom boom.
This morning’s results, which are the first since the Granada and Carlton merger, show that the deal has already started to bear fruit, as operating profit at ITV grew by 32% to £123 million.
Chief Executive, Charles Allen said: “This is a good set of results and I’m delighted that ITV is delivering on all aspects of the merger with operating profit up by 32%. We are driving real growth, restructuring ITV, achieving our cost saving targets six month early and increasing our cost saving target for the future. This has been the result of excellent team work across the board.”
As well as achieving exceptional advertising revenue results, ITV2 saw its viewing share grow by 20%. The statement issued this morning said: “ITV2’s success has been based on the effective complementary scheduling and cross-promotional strategy we have adopted across the channel portfolio.”
However, not all channels shared the audience success of ITV2, as ITV1 saw its share dip by 0.5% year-on-year to 23.3%, emerging as the latest casualty of Freeview, which has grown massively in popularity during the period.
The broadcaster hopes it can build on the success of ITV2 with the launch of ITV3 in November this year, which will be targeting the lucrative 35+ age group.
The second half of this year looks set to continue adding to the achievements of the first half, as advertising revenues in the third quarter are predicted to grow by over 5.5%, up 10% year-on-year, spurred by a strong autumn schedule which includes various new dramas and star-studded entertainment shows.
ITV is currently in the process of selling off £600 million of its non-core assets in a bid to raise money to fund its £100 million revenue shortfall that materialised as a result of advertisers negotiating more competitive deals (see Dip In Share Leaves ITV Facing Revenue Shortfall).
ITV: 020 7843 8000 www.itv.com
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