ITV meets expectations as revenue drops amid decline in advertising
Source - SMW
ITV reported a drop in advertising growth in the first quarter of the year that met its expectations as economic uncertainty and the timing of Easter weighed on demand for advertising.
For the 3 months ended 31 March, total external revenue was down 4% at £743m from a year earlier, with growth in ITV Studios revenue and 22% growth in video-on-demand revenues offset by the decline in spot advertising impacted by the timing of Easter and economic and political uncertainty, the company said .
Total advertising for the four months to the end of April was down 3%, that was in line with guidance given in February for a 3% to 4% decline as the company benefited from a stronger April.
'In April, total advertising was up 8% and is forecast to be down 2% in May and down around 20% in June compared to an exceptionally strong June 2018 which was up 22% on the previous year due to the Football World Cup,' the company said.
ITV Family Share of viewing was up 4% and online viewing up 16% during the quarter.
ITV Broadcast & Online revenue was down 7% at £489m, with ITV total advertising down 7% as previously guided, the company said. Total Studios organic revenue at constant currency was up 1% at £384m for the quarter, and the company said it was confident of delivery 'good' organic growth for the year, with a solid slate of new and returning programmes. including including Snowpiercer, World On Fire, Line of Duty, Zero Zero Zero, Hell's Kitchen, Love Island and I'm A Celebrity… Get Me Out Of Here!.
The broadcaster also made progress on its strategy to lessen its reliance on advertising in favour of producing content for license, with Britbox, a joint-streaming venture with the BBC, expected to be launched in the second half of the year.
'We are making good progress in delivering the strategy and we expect to launch BritBox in the second half of the year. We have also concluded an agreement with a leading ad tech provider, Amobee, which will enable us to deliver programmatic addressable advertising around our premium video inventory on the ITV Hub,' the company said.
The company touted optimism for the months ahead, and said it would remain focused on controlling costs.
'ITV's performance in the first three months was very much as we expected,' said Carolyn McCall, ITV Chief Executive. 'Viewing has continued to be strong with ITV Family share of viewing up 4% and a 16% increase in viewing hours on the ITV Hub.'
'This reflects the strength and depth of our schedule with highlights such as Manhunt, Cheat, Cleaning Up and The Bay which were the four most watched new dramas so far this year with more than 7m viewers each, and the continued success of the Six Nations and Dancing On Ice. We have an exciting schedule for the remainder of the year including Wild Bill, Beecham House, A Confession, the Rugby World Cup and the return of Love Island.'
'We remain very focused on delivering in the areas we can control, with our investment and cost saving programmes on track, and we are actively mitigating the factors outside the company's control. We have a solid balance sheet which enables us to make the right decisions to build a robust and growing business and deliver returns to shareholders in line with our guidance.