Strong demand for digital and local programming and a buoyant advertising market underpinned a decent performance from STV (STVG) in 2015. The Scottish television broadcaster's only flop was its production business, which forced it to write off £5.1m in goodwill. But exclude that and other one-off costs and adjusted operating profits rose 4 per cent to £20.3m.
STV - which holds the broadcasting licence for ITV 1 in Scotland - eked out a 1 per cent rise in turnover in its main consumer segment. That reflected higher national and regional advertising sales, as audiences and advertisers embraced its flagship and city-focused channels. Meanwhile, the addition of live viewing to online catch-up service STV Player helped drive digital revenues up by a quarter to £6.6m.
Management has invested heavily in digital, local and original content to reduce STV's reliance on cyclical advertising revenues. Non-broadcast offerings accounted for 22 per cent of total earnings in the period - double the proportion in 2011. That was despite a 38 per cent slump in production sales due to fewer commissions and deliveries.
Broker Numis reckons the second quarter will benefit from this year's Euro football championship, while the third quarter may feel the absence of last year's Rugby World Cup. Neverthless, it forecasts EPS of 43p for 2016, up from 39.9p in 2015.
| STV (STVG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 425p | MARKET VALUE: | £ 167m | |
| TOUCH: | 422-425p | 12-MONTH HIGH: | 520p | LOW: 338p |
| DIVIDEND YIELD: | 2.4% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 28p* | NET DEBT: | 236% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 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 |
| 2015 | 117 | 9.8 | 29.8 | 10.0 |
| % change | -3 | -43 | -23 | +25 |
Ex-div: 14 Apr Payment: 20 May *Includes intangible assets of £4.5m, or 11p a share | ||||
