ITV's (ITV) increasingly diverse revenue streams served it well during a tough year for UK broadcasters. Although net advertising revenue - which contributes just under half of total sales - was down 3 per cent in 2016, strength in online, pay and interactive broadcasting, as well as ITV's growing studios business helped send overall group revenues up. Strip out acquisition-related costs and other exceptional items and adjusted EPS rose 3 per cent.
Lower demand for TV advertising looks set to continue into 2017 with ITV ad sales in the four months to April expected to fall 6 per cent. But, by contrast, chief executive Adam Crozier isn't "remotely concerned" about the demand for online advertising. Last year, revenue in the group's digital business rose 23 per cent as advertising sales and ITV Hub viewing figures jumped.
ITV studios is also performing well, helped along by acquisitions. The division now makes up 46 per cent of reported revenue, with half of that earned outside of the UK. Although organic growth was stunted by programme scheduling changes, the division reported a 13 per cent rise in revenues thanks to the newly acquired studios.
Broker Numis expects pre-tax profits of £805m for the year to December 2017, giving EPS of 16.1p (from £847m and 17p in FY2016).
ITV (ITV) | ||||
|---|---|---|---|---|
| ORD PRICE: | 206.5p | MARKET VALUE: | £8.31bn | |
| TOUCH: | 206.4-206.6p | 12-MONTHHIGH: | 244p | LOW: 141p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 18p* | NET DEBT | 84% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 2.20 | 334 | 6.6 | 2.6 |
| 2013 | 2.39 | 435 | 8.3 | 3.5 |
| 2014 | 2.59 | 605 | 11.6 | 4.7 |
| 2015 | 2.97 | 641 | 12.4 | 6.0 |
| 2016 | 3.06 | 553 | 11.2 | 7.2** |
| % change | +3 | -14 | -10 | +20 |
Ex-div: 27 Apr Payment: 25 May *Includes intangible assets of £1.62bn, or 40p a share **Excludes special dividend of 5p a share | ||||
