Revenues at ITV dropped during the first quarter, as the fallout of the US writers’ and actors’ strike offset recovering advertising sales.
At 75.7p per share, the ITV share price was last 1.8% higher in Thursday business.
Total turnover dipped 7% in the three months to March, to £887 million, as sales at the group’s ITV Studios arm tanked 16% to £382 million.
Strike action in the States wasn’t the only headwind for its production division, either.
The broadcaster said that programme delivery phasing towards the second half, combined with weaker demand from European free-to-air broadcasters due to the tough ad market, also weighed on trading.
ITV said it expected total divisional revenues “to be broadly flat over the full year 2024 with good underlying growth offsetting the impact of the US writers and actors strikes.”
It added that the aforementioned industrial action will shunt £80 million of revenue from 2024 to next year.
Soccer Boost For Q2
Things were brighter elsewhere for Britain’s largest commercial broadcaster. Revenues at its Media and Entertainment division edged 2% higher, to £505 million, as total advertising revenues (TARs) improved 3% from the corresponding 2023 quarter.
Boosted by the UEFA European Championships in June, ITV said it expects TARs to improve further — to 12% — in the current quarter.
The company’s ITVX streaming service also continued performing robustly at the start of 2024. Total streaming hours improved 16%, to 449 million hours, which in turn pushed digital revenues 11% higher year on year.
The FTSE 100 company said that “ITVX has started the year strongly and we will continue to build on its successful launch year through further developments in content, product, distribution and marketing.”
Targets In Tact
Chief executive Carolyn McCall said that “ITV continues to execute its strategy successfully,” adding that “we have a strong pipeline of programmes, good demand for our quality content as we increasingly diversify our customer base towards streamers.”
The business said ITV Studios “remains on course to deliver total organic revenue growth of 5% on average per annum from 2021 to 2026 — ahead of the market, and at a margin of 13 to 15%.”
Media and Entertainment, meanwhile, is still on track to chalk up “at least” £750 million of digital sales by 2026, ITV said.
Still Some Uncertainty
Adam Vettese, analyst at eToro, commented that “even with overall revenue down, it seems the message is not to panic as most of ITV’s releases are weighted to [the second half] and the Euros are coming up in the summer.”
He noted that these “will give a much needed boost to the coffers in terms of viewer numbers and in turn advertising revenue.”
However, Vettese added that “investors may be a little wary though as the firm heavily relies on this pipeline of shows to offset this sluggish start to the year.”
