ITV says Brexit uncertainty caused slump in ad revenue
UTV parent company ITV has reported a fall in half-year sales and profits as advertising revenue continues to dip following the Brexit vote and economic uncertainty.
The broadcasting giant, home to shows such as The X Factor and Broadchurch, said net advertising revenues dropped 8% to £769m as it pointed to "continued economic and political uncertainty".
The company acquired UTV and its sister Irish broadcaster UTV Ireland in a £100m deal last year. UTV Ireland is now part of Virgin Media.
ITV's total external revenues, including advertising, programme sales and online, fell 3% to £1.45bn in the six months to June 30.
Statutory pre-tax profit slumped 16% to £259m in the period as chairman Peter Bazalgette said advertising revenue is again likely to continue its downward trajectory.
He added: "ITV's performance in the first six months of the year is very much as we anticipated and our guidance for the full year remains unchanged.
"We expect net advertising revenues in quarter three to be down around 4%, again impacted by wider economic uncertainty, and over the full year we expect to outperform the TV advertising market."
ITV Studios revenue rose by 7% to £697m as it benefited from new dramas including Unforgotten, Little Boy Blue and The Loch.
In March, ITV blamed Brexit vote uncertainty for its first drop in full-year advertising revenues since 2009 and warned over further falls as advertising spending remains under pressure.
Earlier this month, ITV announced that easyJet boss Carolyn McCall will join the firm as the broadcaster's first ever female chief executive next January.
The firm said it is on track to deliver £25m of cost savings and a £25m reduction in its programme budget over the full year.
It also signalled a "strong slate" of new and returning programmes including Victoria, Cold Feet, Liar and I'm A Celebrity Get Me Out of Here.
ITV shares rose almost 3% in morning trading.
George Salmon, equity analyst at Hargreaves Lansdown, said: "With Brexit uncertainty lingering, ITV is finding customers are putting the brakes on. However, in other areas, performance looks pretty good."