Channel 4 has recorded it highest ever profit after tax, revealing an increase of 34% to £46 million in 2004, compared to £34.3 million in 2003, according to the broadcasters report and financial statements published today.
The strong profit growth is attributed to record advertising revenues of 8% and the success of the channels commercial arm, 4 Ventures, contributing £161 million to the broadcaster’s annual profits, representing 19% of group turnover.
Commenting on the results, Andy Duncan, chief executive of Channel 4, said: “Channel 4 has been setting the pace for the rest of British television and so it should. That is our public purpose and the reason for Channel 4’s existence as a publicly owned, not-for-profit broadcaster.”
Duncan continued: “Our unique status means all our profits are invested back into our programmes and services, for the benefits of our viewers not shareholders. The creative strength of our schedule allowed us to buck the downwards trend in terrestrial TV viewing last year and we are the only one of the five major channels to experience growth so far in 2005. In 2004 this allowed us to increase Channel 4’s advertising revenues by 8%.
Channel 4 is investing its current surplus to strengthen its public service contribution on the main channel and extend its presence in multi-channel TV and on new media platforms. One such channel is More4 and the broadcasters new music website, channel4.com/music.
Channel 4 also unveiled plans to invest an additional £13.5 million into single and serial drama from 2006, as well as into news and current affairs, introducing a new permanent lunchtime news bulletin and increasing the annual run of Dispatches to 28 in 2005.
The broadcaster’s digital entertainment channel, E4, will also receive a massive 50% increase in its programming budget in anticipation of its launch on the Freeview platform on 27 May.
The group’s strong financial performance in 2004 has allowed it to commit a record investment in the core Channel 4 service, with total expenditure on programmes rising by 6% to £485.5 million, compared to 2003’s figure of £457.5 million.
Channel 4 achieved an overall share of 9.8% of television audiences in 2004, compared to 9.6% in 2003. The broadcaster also reported its highest ever share of the peak time audience at 9.7%.
Luke Johnson, Channel 4 chairman, said: “Both Ofcom and the Government believe Channel 4’s contribution to public service broadcasting is going to become even more important as we approach the digital switchover, and they have clearly stated their approval for the strategic direction in which we’re travelling.”
Channel 4 is confident that with continued investment in creative excellence and new commercial opportunities it can emerge from the process of digital switchover as strong as ever.
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