ITV has reported a rise in pre-tax profit as growth in online offset a decline in spot advertising revenues.
However, eluding to Brexit uncertainty, the UK commercial broadcaster warned economic and political headwinds for the UK will have an effect on the advertising market.
For the 12 months to December 31st 2018, pre-tax profit rose 13 per cent to £567 million (€663.1m) and total revenue rose 3 per cent to £3.77 billion.
Total advertising revenue was up 1 per cent for the full year, with VoD revenue up 36 per cent, more than offsetting the decline in net advertising revenues. That was in line with guidance given in November for broadly flat advertising revenues over the full year. The weakness in net advertising revenue was blamed on the impact of political and economic uncertainty, which kept a lid on corporations’ spot advertising spend.
External revenue was up 3 per cent to £3.21 billion. Total non-advertising revenue grew 5 per cent to £1.97 billion and now accounted for 52 per cent of total revenue, the company said.
Broadcast & online total revenue was up 1 per cent to £2,096 million. ITV Studios, which churned out hit shows such as The Voice, Bodyguard and Love Island, posted a 5 per cent rise in revenue to £1.67 billion for the year. The company proposed a full-year dividend of 8.0p, up 3 per cent on last year Looking ahead, the company said first half revenues and profits would be impacted by tough comparatives against the revenues of the Football World Cup.
“ITV’s operational performance across 2018 was strong despite the uncertain economic and political environment, with total external revenue up 3 per cent, including total advertising revenues up 1 per cent. We delivered great viewing figures on air and online with ITV setting a host of new records and achieving an impressive 3 per cent growth in total viewing,” commented Carolyn McCall, ITV Chief Executive.
“We have started 2019 with strong onscreen and online viewing. However, the economic and political headwinds for the UK will have an effect on the advertising market and while ITV is increasingly diversified, we remain sensitive to this,” she added.