ITV Half Year External Revenues Climb to $2 Billion Despite Ad Sales Weakness

U.K. broadcaster ITV’s total external revenues are up 8% at £1.67 billion ($2.04 billion), according to half year financial results released on Thursday.

Total ITV Studios revenue was up 16% at £927 million, while Media & Entertainment (M&E) revenue was up 4% at £1.06 billion. ITV Studios was the growth driver with the number of high-end scripted hours produced up 82%. Percentage of total studios revenue from streaming platforms in the first half of the year grew from 16% to 19% flowing from commissions or development deals with most of the major platforms.

Over the six month span, total advertising revenue was up 5% and within this, digital advertising revenue was up 20%. However, ad revenues were down by 9% in May and 13% in June, leading to a decline of 5% in the second quarter, but up an overall 5% for the first half of the year. “TAR in July 2022 is expected to be down 9%, better than we expected and August down 18%, broadly in line with our expectations,” the “Love Island” broadcaster said.

Carolyn McCall, ITV chief executive, said: “TAR is expected to be broadly flat in the nine months to the end of September. We are mindful of the macro economic uncertainty, however we have for the first time ever in Q4, the football [soccer] World Cup to look forward to.”

The adjusted group earnings before interest, taxes, and amortization (EBITA) was down 3% at £318 million for the six month period. “This reflects strong underlying performance offset in M&E by additional disciplined investment of £58 million in content and £20 million in data and technology ahead of the launch of [streamer] ITVX,” ITV said in a statement. “Additional content investment, as previously guided, relates to a combination of the return of key shows disrupted last year by COVID and front-footed investment.”

EBITA was £228 million and statutory profit before tax was £219 million, up from £133 million in the corresponding period in 2021.

ITVX is on track to launch in the fourth quarter of the year and, on the back of this, ITV is predicting £750 million of digital revenues by 2026. Digital viewing on ITV Hub, the broadcaster’s current streaming service, was 814 million streams, up 8% year on year.

McCall said: “ITV has recorded a strong performance across the business with both our studios and media and entertainment divisions performing better in the first half than we expected at the beginning of the year. Revenues in both divisions were up year on year and as a result total external revenue rose 8%.”