ITV slumps in bad ad market
March 7, 2024
ITV has reported an overall 2023 profit decline of 61 per cent YoY, to £193 million (€225.8m). The UK commercial broadcaster attributed the figure to the the downturn in the linear ad market and its ongoing investment in streaming service ITVX.
Total group revenues declined by 2 per cent to £4.3 billion, with total external revenue also dropping by 3 per cent to £3.6 billion.
In brighter news, ITV Studios saw a 4 per cent revenue rise to £2.2 billion, and digital revenues rose by 19 per cent to £490 million. ITVX saw monthly users rise by 19 per cent and total streaming hours increase by 26 per cent.
Carolyn McCall, ITV Chief Executive, commented: “In 2023 we saw the benefit of the actions we have taken to reposition ITV towards higher sustainable growth. Our Studios business recorded the highest ever revenues and profits and in its first year ITVX delivered strong growth in viewing and digital revenue with investment on plan. This growth in production and streaming substantially offset the challenging linear TV advertising market conditions.”
“We remain confident in delivering our KPI targets, and are making good progress towards these – most notably ITV Studios organic revenue growth of 5 per cent on average per annum between 2021 and 2026 at a margin of 13 to 15 per cent and to deliver at least £750 million of digital revenues by 2026.”
“We remain firmly committed to creating shareholder value and applying a disciplined approach to capital allocation. As announced on 1 March 2024, we will return the entire net proceeds of the sale of BritBox International through a share buyback of £235 million and the Board has proposed a final dividend of 3.3p giving an ordinary dividend of 5.0p per share or c.£200 million, for the full year.”
“Our existing cost saving programme targeting £150 million between 2019 and 2026, has delivered £130 million of annualised savings to date. We are on track to deliver the full £150 million by 2025 – one year early. In addition, we are now in the early stages of a new strategic restructuring and efficiency programme across the Group to reshape the cost base, enhance profitability, and support the growth drivers of Studios and Streaming. By the end of 2024 we expect the programme to have delivered incremental annualised gross savings of at least £50 million per year, giving a £30 million in year gross benefit in 2024. The ongoing programme is designed to deliver further material incremental savings over a number of years.”
“2023 was the year of peak investment for Streaming, which together with the successful execution of our strategy and the efficiencies delivered to date have made ITV more robust. ITV has a leading, scaled, global Studios business, a high growth Streaming service and a cash generative linear advertising business. This ensures that we are well placed to grow profits from here as we continue to drive material efficiencies, invest behind our strategic priorities and deliver returns to shareholders,” she concluded.