ITV said its profits dropped last year as the broadcaster found it “challenging” to encourage advertisers to spend money on traditional TV commercials.
The parent company of UTV reported growth at some of its business units, but it proved a struggle to keep its advertising take up.
Profit fell from £501 million in 2022 to £193m before tax last year, ITV said.
It was what the business calls “linear” advertising – the industry’s word for the ads shown on television rather than online – which really struggled.
ITV said it had seen a “severe decline” of 15% in linear advertising, as companies that normally advertise were more cautious because of the poor global economy. However, digital revenue performed much better, increasing 19% to £490m.
Reduced advertising spending is also hitting international broadcasters, meaning they have less money to spend on TV programmes from ITV Studios, the company said.
ITV acquired UTV Limited in February 2016, and two years later moved its headquarters from Havelock House on Belfast’s Ormeau Road to City Quays.
The deal also saw ITV acquire the UTV pension scheme.
According to ITV’s latest financial report, the UTV pension scheme, which closed to new entrants at the end of March 2019, had assets of £91m and £88m of liabilities.
ITV told investors on Thursday: “2024 will be impacted by the 2023 US writers’ and actors’ strikes, which will delay around £80m of revenue from 2024 to 2025, as well as weaker demand from free-to-air broadcasters in Europe who are holding back spend until they see more certainty in the advertising market.”
But that will come off the back of a record year for ITV Studios’ profit and revenue, as it produced hit shows including Love Island, a format which has now been sold to 27 countries, and Mr Bates vs The Post Office, which was ITV’s biggest new drama for more than 10 years.
Chief executive Carolyn McCall said: “In 2023 we saw the benefit of the actions we have taken to reposition ITV towards higher sustainable growth.
“Our Studios business recorded the highest ever revenues and profits, and in its first year ITVX delivered strong growth in viewing and digital revenue with investment on plan.
“This growth in production and streaming substantially offset the challenging linear TV advertising market conditions.”
