ITV’s share price has been on track for the biggest one-day rally since Wednesday 2009, after broadcasters announced they expect the highest annual advertising revenue ever, behind a long-term slump. Expectations are rising that there is a possibility.
The FTSE 100 Media Group predicts that the resumption of the economy will increase advertising sales for the full year by 24% year-on-year and its share in morning transactions by 11.5%.
The UK’s largest commercial free broadcaster reports total revenue of £ 2.79 billion in the first nine months of 2021, 28% higher than a year ago and 8% higher than the pre-pandemic period of 2019. bottom.
ITV was hit hard by the collapse of advertising during the coronavirus crisis. As a result, ITV has eliminated dividends and accelerated cost savings.
Chief Executive Carolyn McCall said: “By any standards ITV has had an outstanding nine months. Both our Studios and Media & Entertainment businesses have performed very strongly. Revenue from each business over the nine months is up both on last year and on 2019. This drove total external revenue up 28% compared to 2020 and 8% higher than 2019.”
For the nine months to September 30, revenue was GBP2.79 billion, up 29% from GBP2.17 billion at the same time last year. Total advertising revenue came in at GBP1.36 billion, rising 31% from GBP1.04 billion.
Studios revenue was up 32% to GBP1.19 billion, while M&E revenue was 26% higher at GBP1.59 billion.
Compared to 2019, Studios revenue was up 6% and M&E up 8%.
“We are becoming an increasingly scaled digital business. Our online viewing was up 39% in the nine months which, together with the roll out of Planet V, helped our video on demand advertising revenue to climb 54%. Our monthly active users now stand at 9.6 million, a 22% increase year on year reflecting the focus on our [advertising-based video-on-demand] strategy,” McCall continued.
But even before the pandemic, ITV’s share was squeezed as the company fought to retain viewers in the face of competition from deep-pocket streaming services such as Netflix.
Despite a 38% increase over the past year, the company still has challenges, with a 28% lower market share than it was five years ago. Berenberg analyst Sarah Simon said:
However, the latest trading information on Wednesday shows that the company is pursuing its strategy under Dame Carolyn McCall, which joined from easyJet about four years ago.
McCall led the push to digital services and expanded ITV Studios, the company’s production arm. This will produce programs for other stations, such as: Duties When Be vigilant For the BBC.
Revenues from ITV Studios increased 32% over this period to £ 1.19 billion, and the group has a “strong pipeline” of production for domestic clients as well as overseas markets such as the United States and Italy. I said there is.
ITV Hub, the broadcaster’s online viewing platform, saw 9.6 million monthly active viewers, up 22% year-on-year. According to the company, consumers were encouraged by the redesign. Revenue from video-on-demand advertising surged 54%.
ITV said it has signed a five-year “extension and enhancement” contract with Virgin Media 02. Under this arrangement, ITV Hub will be integrated into the Virgin TV set-top box.
Looking ahead, ITV said total advertising revenue for 2021 is expected to be the highest in the company’s history. ITV highlighted it has a strong programming slate going into next year as it continues to invest in content and expects total schedule costs to be around GBP1.16 billion in 2022. This includes the FIFA World Cup, the FA Cup and a strong schedule of dramas at ITV Studios which will “drive increased levels of live and streaming viewing”.
“With the combination of Broadcast and ITV Hub’s mass simultaneous reach, our brand safe addressable advertising product and the strong economy, 2021 looks set to have the highest advertising revenue in ITV’s history, despite the lockdown in the first quarter,” McCall said.
She added: “Today’s results further illustrate that ITV has successfully completed the first phase of its More Than TV strategy and is accelerating the second phase of digital transformation as we evolve our products, user experiences and ways of working.”
“By all standards, ITV has been great for nine months,” McCall said.
The ITV said it expects a return on the final dividend, and next year, along with a roster including the Fifa World Cup, will spend £ 1.16 billion on programming, much like the previous year.
Total ITV channel views fell 5% year-on-year in nine months, contrary to the harsh comparison of 2020, when viewership was high due to the blockade of the coronavirus.