ITV (ITV) posted growth across its broadcasting, online and production businesses last year, as it benefited from the FIFA World Cup, foreign acquisitions and a revitalised advertising market. The upshot was a 19 per cent increase in the broadcaster's operating profit to £651m.
Higher advertising revenues fuelled a 7 per cent increase in broadcasting and online sales, as the division launched new channels ITVBe - which caters to young female viewers - and ITV Encore, its first pay-only channel. The audience share of its ITV Family channels fell 5 per cent, as its flagship ITV channel lost ground to the BBC. But that was offset by a 30 per cent surge in online, pay and interactive revenues to £153m, reflecting rapid growth in on-demand video consumption and investment in its ITV Player.
Sales climbed 9 per cent at the group's production business, ITV Studios, as it bolstered its overseas presence through acquisitions in Denmark and the US. Management expect a double-digit increase in constant-currency sales for the unit this year. They also expect first-quarter advertising revenues to rise 11 per cent, but election-related disruption and the hangover from the World Cup threaten to depress growth later in the year. Nonetheless, management hiked the dividend by a third and announced a special payout of 6.25p a share.
Broker Numis expects pre-tax profits of £770m, giving EPS of 14.8p (from £712m and 13.7p in 2014).
| ITV (ITV) | ||||
|---|---|---|---|---|
| ORD PRICE: | 232p | MARKET VALUE: | £9.3bn | |
| TOUCH: | 231-232p | 12-MONTH HIGH: | 235p | LOW: 167p |
| DIVIDEND YIELD: | 2.0% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 25p* | NET CASH: | £41m | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p)† |
|---|---|---|---|---|
| 2010 | 2.06 | 286 | 6.9 | nil |
| 2011 | 2.14 | 327 | 6.4 | 1.6 |
| 2012 (restated) | 2.20 | 334 | 6.6 | 2.6 |
| 2013 | 2.39 | 435 | 8.3 | 3.5 |
| 2014 | 2.59 | 605 | 11.6 | 4.7 |
| % change | +8 | +39 | +40 | +34 |
Ex-div: 30 Apr Payment: 29 May *Includes intangible assets of £1.1bn, or 28p a share †Excludes special dividends of 4p a share in 2012 and 2013, and 6.25p in 2014 | ||||
