STV swings to loss as advertising revenue slumps
STV today posted a loss for the first half of the year as record audience figures failed to offset a sharp fall in ad revenue caused by coronavirus.
The figures
Revenue for the six months to the end of June dropped 19 per cent from £54.9m to £44.7m. STV’s Ebitda fell 40 per cent from £13.4m to £8m.
Digital revenues edged up five per cent as video on demand revenue from STV Player grew 13 per cent.
STV swung from a £9.1m profit before tax in the first half of 2019 to a loss of £4.9m this year.
The broadcaster has declared an interim dividend of 3p per share to be satisfied by way of a bonus issue of new ordinary shares.
Why it’s interesting
The Scottish broadcaster boasted its highest audience growth ever – 12 per cent – with an all time viewing share of 19.2 per cent. STV continues to be Scotland’s most popular peak time channel, with growth continuing even after lockdown.
Figures boomed during lockdown, with viewing up 24 per cent, a 48 per ent growth during the daytime. STV News saw a 40 per cent jump in audience figures.
Although revenues slumped during lockdown, trading conditions have improved in July, with August’s total advertising returning to year-on-year growth.
While studio activities have been severely limited in the second quarter due to lockdown restrictions, the year-on-year decline was limited given the second half bias.
What STV said
Chief executive Simon Pitts said:
While our advertising and production revenues have been significantly impacted by Covid-19, we have been able to mitigate nearly half of the impact thanks to the proactive steps we have taken and our variable cost model. The successful share placing in July has also significantly strengthened the balance sheet and given us the confidence to continue to invest behind our growth strategy.
The outlook is much more positive in the second half, with advertising trends improving materially in July and August, and a strong schedule to look forward to on TV and online including the return of a full complement of weekly soap episodes from later this month, new drama like Des starring David Tennant, and entertainment juggernauts like the rescheduled BGT live finals and I’m a Celebrity.