UK TV Trading Looks Strong With ITV Showing H2 Pick-Up

ITV is now expected to show year on year growth of 7.0% in August and 2.8% in September. This compares to forecasts from Merrill Lynch of 3.0% and 0.5% respectively. October revenue is looking like it might grow by 6% or more; the broker had forecast 4.8% growth, as against a very weak October in 2001. December at ITV is still expected to be down, by around 5% according Merrill Lynch.

The broker says that the fall in commercial impacts – resulting from declining viewing figures – will be fully reflected in ad rate negotiations for 2003, which will take place in November and December. As a result, Merrill is reducing its 2003 forecast from 4.0% to 0.5%, in a market up by 3.5%.

Despite this cautious approach to 2003, analysts say that the short-term market is quite strong, with November looking to set to show around 4.0% growth for ITV.

ITV Advertising Revenue Growth
	Merrill Lynch forecast	Early trading indications
August	3.0	6.0
September	0.5	2.8
October	4.8	6.0
November	0.2	4.0
December	-4.5	-5.0
2002	-1.9	–
2003	0.5	–
Source: Merrill Lynch, September 2002

Growth could be even higher Figures from MindShare, quoted by MediaGuardian.co.uk at the beginning of the week, predict that ITV’s October revenue could be up by as much as 10%, in a commercial TV market up by as much as 13% overall. In November, growth could be 4%, in line with Merrill Lynch’s data.

MindShare forecasts that Channel 4’s September revenue will rise by 16%, while Channel 5’s will be up by 28%, according to the report. Cable and satellite could be up by as much as 18%.

The report also quotes figures from Media Planning Group, which indicate that ITV could finish the year up by 3%, if the second half manages to hit a possible 5% growth. These forecasts are more optimistic than Merrill Lynch’s, which predict a 1.9% decline for the full year 2002.