STV shares rise as broadcaster posts huge rise in profit
Shares in STV rose roughly seven per cent today after the Scottish broadcaster posted a huge rise in profit for the full year.
STV, which holds the channel 3 licence in Scotland, reported pre-tax profit of £19m last year, up from just £1.9m in 2018.
However, revenue slipped two per cent over the period to £123.8m, which it blamed on a squeeze on the wider advertising market.
Total advertising revenue grew two per cent to £101.6m, driven by a sharp increase in digital growth and stronger demand for regional advertising.
The commercial broadcaster said it was now the most watched peak time channel in Scotland, beating BBC One for the first time since 2013.
The company has also proved more resilient to a downturn in viewing from younger audiences, reaching 92 per cent of 16 to 34-year-olds last year.
Much like ITV, STV said viewing had been bolstered by entertainment hits such as I’m a Celebrity and The Chase, as well as new dramas including Manhunt and the Rugby World Cup.
The broadcaster has also looked to focus on its online STV Player in a bid to counteract slowing advertising revenue for traditional TV.
STV said online viewing was up 23 per cent in 2019, while STV Player registrations rose to 3.5m, or 80 per cent of the adult Scottish population.
The firm is also understood to be mulling the launch of its own streaming service similar to Britbox, which was launched by the BBC and ITV last year.
STV said it is on track to meet its target of diversifying one third of profit away from traditional TV advertising by the end of the year.
Revenue at STV Production slipped from £16.3m to £13.7m last year. However, this came amid a broader growth strategy as the firm made investments in smaller production houses.
STV said the moves would help to expand its range of exclusive content for STV Player, which has signed deals to feature on Sky and Apple TV.
Chief executive Simon Pitts said the profit rise “illustrates our growing resilience and the exciting growth potential of our regional, digital and production businesses”.
“We continue to make excellent progress with our strategic growth plan and have laid solid foundations for future growth, including in STV Productions where 2019 saw a return to high-end drama for the first time in a decade with the critically acclaimed The Victim and Elizabeth is Missing for BBC One,” he added.
STV said the implications of the coronavirus outbreak were “unclear”, but said it would continue to monitor the situation. Earlier this month ITV’s share price crashed after it warned the virus would impact ad revenue in 2020.
Main image credit: ITV