C4’s digital TV services buck the downward trend with a £300,000 profit
Channel 4 has reported a 14% year on year decline in ad revenues for its main network, but made a small profit of £300,000 due a strong performance from digital TV in 2009.
The broadcaster said last year’s recession is the worst it has seen in its 28-year history. Channel 4 suffered a 14% year on year drop in advertising revenues, down from £668.7 million to £575.1 million.
According to Channel 4’s annual report, which was released today, the main channel’s loss increased from £9.9 million in 2008 to £61.6 million in 2009.
However, the group’s digital TV services, which include Film4, E4, More 4 and 4Music, managed to buck the trend, posting a 4% year on year increase to £181.3 million. As a result, Channel 4’s digital TV profits were up by a significant 43% year on year to £53.4 million.
Channel 4’s Future Media operation also made a pre-tax profit of £3 million, compared with a £7.3 million loss in 2008.
However, the broadcaster’s online business saw revenues fall 2% year on year to £32.8 million, although Channel 4’s cost-savings helped the division reach a profit.
The video-on-demand service 4OD managed to offset the decline in online display advertising, after posting an impressive 60% year on year increase in full-length programme views to 218 million.
However, Channel 4’s overall turnover was down 8% year on year to £830.3 million. Profit dropped from £1.8 million in 2008 to £300,000 last year.
The broadcaster continued to cut costs last year, slashing 8% from the 2009 programming and content budget, 8% from the operations budget, and reducing the average monthly headcount by 23% year on year.
Channel 4’s group finance director, Anne Bulford, said: “These results clearly demonstrate the value of Channel 4’s long-term investment in making our content available digitally and the tight controls we have exercised over costs.”
David Abraham, who took over as chief executive of Channel 4 last month, added: “It’s a credit to everyone working here that Channel 4 has come through such a sharp downturn with our share of advertising revenues and ratings and our cash reserves intact and that we’ve continued to deliver creative excellence despite having significantly less money to spend on content.
“We have created a stable financial base that allows us to commit with confidence to a fresh round of creative and commercial innovation, renewing Channel 4’s schedules post Big Brother and positioning ourselves to take advantage of the opportunities that arise from the ongoing convergence of television and other media.”