ITV shares drop after broadcaster cancels Love Island
Shares in ITV fell more than four per cent this morning after the broadcaster confirmed it has cancelled Love Island due to coronavirus.
In a statement ITV said series seven of the hit dating show will now take place in 2021 as travelling to a villa in Mallorca for filming was “out of the question”.
“We have tried every which way to make Love Island this summer but logistically it’s just not possible to produce it in a way that safeguards the wellbeing of everyone involved and that for us is the priority,” said Kevin Lygo, ITV’s director of television.
“We are very sorry for fans of the show but making it safely is our prime concern and Love Island will be back stronger than ever in 2021. In the meantime Love Island fans can still enjoy all six series of Love Island on Britbox.”
The cancellation will come as a huge blow to the public service broadcaster, which has suffered both a decline in advertising revenue and a shutdown in filming.
ITV has scrapped its full-year dividend and abandoned guidance for 2020 as a result of the expected slump in revenue.
Director bonuses have been scrapped and the company’s board has also taken a 20 per cent pay cut in a bid to hold onto cash.
Much like other broadcasters, ITV has been crippled the collapse of the advertising market even as viewing figures have surged during the lockdown.
But ITV is particularly vulnerable due to its reliance on live sport and the wildly successful Love Island, which launched a winter version for the first time earlier this year.
In a bid to diversify away from ad revenue, the firm has started investing heavily in producing original programming. Its Studios arm posted a nine per cent rise in revenue to £1.8bn last year.
However, social distancing measures have prompted a shutdown in production across the globe, and ITV will be facing a huge shortfall in its pipeline of new shows.
The company’s share price has plummeted more than 50 per cent since the start of the year, with underlying challenges posed by streaming rivals such as Netflix now compounded by the Covid-19 crisis.
Speculation may also be rising about a potential takeover of ITV by Liberty Global, which holds a 10 per cent stake in the broadcaster.
Liberty today confirmed it has entered into talks about a potential merger between O2 and Virgin Media to form a new company straddling mobile, broadband and pay-TV.
Main image credit: ITV