ITV has been forced to “reassess” the targets of its turnaround strategy as it reports a 28% dip in year-on-year pre-tax profit to £91m for the first half of 2008. It comes as the broadcaster predicts that ad revenue for September will plummet by 20%.
The broadcaster saw a 3% increase in group revenue to £1.03bn for the six months to June 30, but it says that ad revenue for the first eight months of the year has been flat. Its share of commercial impacts across the ITV Family was flat at 41.4%, although share was down by 5.1% at flagship channel ITV1.
ITV says that as a result of the tougher economic climate it is planning to make £35m in cost savings by the end of 2010. It has also adjusted its target for its global content division, which sells its programme formats and franchises globally, from £1.2bn to £1bn by 2012, and has moved back its online revenue target of £150m, by 2010 also to 2012. The latter has been affected by regulatory delays to the planned catch-up programming service, Kangaroo.
Michael Grade, ITV executive chairman, says: “We cannot control the economic environment in which we operate. As a result of the recent slowdown in the television advertising market, the board has taken some tough decisions which are reported here today.”
He adds that despite a tough September, which included the Rugby World Cup last year, ITV expects to outperform the total ad market over the full year.
Revenue in its online division, which includes Friends Reunited, grew by 6% per the period, with an average of 6 million unique users per month.