ITV Returns to Profit

LONDON: ITV plc reported a pre-tax profit of £25 million for 2009, as compared with its 2008 loss of £2.7 billion, on revenues that were down by 7 percent to £1.9 billion.

The company attributed the improved results in part to its cost-cutting efforts, with £169 million delivered in the year, ahead of the £155 million target. Announcing the results, interim chief executive John Cresswell—to be succeeded by Adam Crozier in April—noted: “Faced with the worst television advertising downturn on record, we took decisive action to improve our operational performance, deliver substantial cost savings and strengthen our balance sheet. We won back share of the TV advertising market, grew our audiences in peak time and online, and increased our international production presence. We took out costs of £169 million, substantially reduced our headcount and lowered net debt by over £100 million. Whilst ITV advertising revenues are up 7 percent in the first quarter, this is against the unprecedented declines of the previous year and, over the medium term, we remain cautious. We recognize also that ITV still faces formidable challenges. However, with the concerted action we have taken, ITV can address these from a stronger position, both financially and operationally.”

Archie Norman, the chairman of the British broadcasting group, added: “Under Adam Crozier’s leadership, ITV will set out on the journey to become a very different business over the next five years. ITV’s challenge is to reduce its dependence on a free-to-air model threatened by digital media and besieged by legacy regulation. We have great talent and a strong brand and our future is in our own hands.”

Television ad revenues last year fell 9 percent to £1.3 billion. ITV Studios’ revenues fell 4 percent to £597 million, with a U.K. decline offset by gains in its international business. Online revenues increased from £18 million to £24 million.