First-Half Loss for ITV

LONDON, August 6:
Impairment charges have left ITV plc with a loss for the first six months of
the year of £1.5 billion, versus the £85 million profit recorded in the
year-ago period.

The non-cash impairment
charge of £1.6 billion on broadcasting goodwill is a result of reduced ad
forecasts for the 2008/09 period, the company said.

ITV posted stable revenues
of £1.03 billion, 3-percent up on last year, with an operating EBITA of £121
million, a 20-percent decline.

Net advertising revenue
for the ITV family of channels was flat at £723 million, with £583 million for
ITV1, down by £12 million on the year-ago period. Broadcasting revenues in
total were £832 million, a 1-percent fall, while global content revenues gained
3 percent to £149 million and online revenues gained 6 percent to £17 million.

In light of this period’s
results, the company has made some changes to its Turnaround Strategy. It now
aims to reach £1 billion in revenues for its global content business by 2012,
instead of £1.2 billion, and online revenues are targeted to reach £150 million
by that time, later than the initial 2010 target. The target of an audience
share of 38.5 percent for the ITV suite of channels by 2012 is unchanged. To
reach its goals, ITV is planning to achieve a further £35 million in cost
savings by end 2010.

Michael Grade, the
executive chairman of ITV, said: “Almost a year into the Turnaround Strategy,
we have made considerable operational progress. With more viewers watching more
ITV programs, we are delivering greater value for advertisers. We have
outperformed the market in terms of advertising revenues and viewing share. Our
global content business is growing strongly and our presence online is
strengthening, notwithstanding the delay in launching Kangaroo.”

He continued: “Whilst our
visibility on advertising revenues beyond September is limited, with a strong
schedule in place for the rest of the year and planned for 2009, we are
confident that we will continue to outperform.”

Grade concluded: “By
holding our focus on delivering the Turnaround Strategy, we are confident ITV
will be strongly positioned to grow as the economy recovers. ITV’s long-term
goal remains to create greater value for shareholders in the digital world from
our position as the U.K.’s favorite source of free entertainment.”

—By Mansha Daswani