Last year's Fifa World Cup, soaring digital consumption and channel launches drove operating profit at STV (STVG) up 8 per cent to £19.5m. The Scottish broadcaster - whose flagship STV channel attracts more than 3.6m viewers a month - wasted no time quadrupling its dividend and guiding towards annual EPS growth of 10 per cent for the next three years.
Both sales and operating profits climbed 9 per cent in STV's consumer division, which includes its television channels as well as live-streaming and catch-up platforms. That reflected an 8 per cent increase in national advertising, as marketers vied for World Cup exposure. Moreover, digital revenues climbed 23 per cent to £5.3m, and new channels focused on Glasgow and Edinburgh attracted more than 100 new advertisers. STV's fledgling production business, meanwhile, renewed commissions for Catchphrase from ITV and three shows with the BBC. But the unit's revenues dipped slightly as second-half deliveries fell behind target.
STV has addressed its leverage: net debt is down a third from 2012 to a more comfortable 1.4 times cash profits. And the group's immediate prospects look strong: first-quarter national airtime sales and digital revenues are 11 per cent and 30 per cent ahead of last year, respectively. This year's Rugby World Cup may also provide a boost.
Broker Numis bumped up its 2015 pre-tax profit and EPS forecasts to £19m and 41.3p, respectively.
| STV (STVG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 380p | MARKET VALUE: | £149m | |
| TOUCH: | 378-380p | 12-MONTH HIGH: | 394p | LOW: 322p |
| DIVIDEND YIELD: | 2.1% | PE RATIO: | 10 | |
| NET ASSET VALUE: | 9p* | NET DEBT: | 840% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 105 | 3.9 | 14.6 | nil |
| 2011 | 102 | -0.9 | 1.6 | nil |
| 2012 | 103 | 6.4 | 13.0 | nil |
| 2013 | 112 | 14.3 | 32.2 | 2.0 |
| 2014 | 120 | 17.3 | 38.7 | 8.0 |
| % change | +7 | +21 | +20 | +300 |
Ex-div: 16 Apr Payment: 22 May *Includes intangible assets of £9.5m, or 24p a share | ||||
