ITV boosted by Studios gains

UK broadcaster ITV reported double-digit revenue and adjusted EBITA growth in the first half of the year, driven by strong gains at its production arm ITV Studios.

Buoyed by its acquired production companies Talpa, Twofour and Mammoth Screen, sales at ITV Studios were up 31% year-on-year, taking the total to £651 million (€777 million).

However, on a like for like basis, stripping out the contributions from the companies acquired in the past year, revenue at ITV Studios was actually down 4% with ITV America hit by the timing of some key shows.

ITV America revenue fell 34% year-on-year to £96 million, but ITV Studios’ interim EBITA profit was £121 million, a 42% increase on the 2015 total. ITV said that half of all ITV Studios’ revenues now come from international markets.

Within the Global Entertainment distribution business, revenue was up 11%, taking the total to £79 million. ITV also reported strong gains for its online, pay and interactive segment, with revenue up 26% year-on-year to £107 million.

Overall revenue at ITV was £1.7 billion, up 12% year-on-year. EBIT profit increased 9% over the same period, taking the total to £425 million. Adjusted EBITA in the period rose 10% to £438 million.

ITV said it will look for £25 million in cost savings in 2017 amid the market uncertainty created by the UK’s decision to exit the EU.

“On screen we are performing well and we remain focused on delivering both mass audiences and the key demographics,” the broadcaster said this morning. “However, we expect our viewing performance over the summer to be impacted by the Olympic Games on the BBC. We expect online, pay and interactive to deliver double-digit revenue growth over the full year as it continues to perform strongly.”

Addressing its international business, it added: “ITV Studios is on track to deliver double-digit revenue and adjusted EBITA growth over the full year, driven by the acquisitions we have made. Over the medium term we are confident in delivering good growth in our global network of content creation and distribution, organically and through acquisitions, although the short term performance will continue to be lumpy.”

ITV has been on an ongoing acquisition spree and that shows no sign of ending. It noted: “Whilst the economic outlook remains uncertain we continue to see clear opportunities to invest across the business, both in the UK and Internationally.”