ITV’s profits down by 41%

ITV is set to slash a further 600 jobs, cut £65 million from its programme budget and sell Friends Reunited and SDN in a desperate attempt to recover finances following its 41% profit decline.

The struggling broadcaster today reported an adjusted pre-tax profit fall of 41% in 2008 to £167 million and a 32% drop in earnings before interest, tax and amortisation to £211 million.

ITV’s overall loss was £2.7 billion, including a goodwill impairment charge of £1.6 billion recognised at half year and a further £1.09 billion recorded in the full year due to a deterioration of the markets.

In 2008, ITV’s net ad revenue fell 4% year on year to £1.4 billion, ahead of the total TV market down 5%, while revenues in its global content division were up 10% to £622 million.

However, the commercial broadcaster said that for the first time since the early 1980s, it managed to hold its share of the television advertising market year on year.

ITV’s share of the market in 2008 was 43.8%, with ITV1 advertising falling by 8% to £1.13 billion, which was balanced by advertising on ITV’s digital channels – up 16% to £242 million.

However, the broadcaster’s online earnings before interest, tax, depreciation and amortisation dived from a £12 million loss in 2007 to £20 million in 2008.

ITV said this was due to a fall in profits at Friends Reunited, investment in itv.com and costs relating to the closure of Kangaroo, the joint VoD venture with Channel 4 and BBC Worldwide.

ITV’s chief executive, Michael Grade, said: “Current conditions in the advertising market are the most challenging I have experienced in over 30 years in UK broadcasting. Our priorities have to be aligned to the changed economic context.”