ITV expected to blame Brexit for dip in advertising sales
ITV is expected to cite the Brexit vote as the cause for its first decline in advertising sales since the financial crisis.
The broadcaster will unveil a drop of around 7 percent in advertising sales when it publishes full-year results on Wednesday, The Sunday Times reported yesterday.
The first advertising decline since 2009 will be put down to a difficult post-referendum climate, which has seen cautious companies reduce their spending on TV commercials since June last year.
Overall results are expected to be roughly flat, with pre-tax profits forecast between £820m and £860m, compared to £843m in 2015.
However online trading provider Accendo Market stated on Thursday that ITV's annual results could provide a platform for breakout, with the average target suggesting a 10 per cent increase in share price. ITV shares currently trade at about 202p.
Since current chief executive Adam Crozier took over in 2010, the company's share price has quadrupled from 54p to a high in February 2016 of 270p. The immediate aftermath of the EU referendum saw its share price drop to 154p but it has since recovered.
The share price has also benefited from speculation about the company's M&A potential since mid-January. Following Twenty-First Century Fox's takeover of Sky, it was widely believed that ITV could be the next British media company to be bought by a foreign investor.