STV to resume dividend after revenues return

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BROADCASTING group STV plans to reinstate its dividend after reporting rising revenues and falling debts for the first six months of the year.

The firm, which last paid a dividend in 2006, said yesterday its revenues rose eight per cent to £51.2m, while pre-tax profits increased one per cent to £6.7m.

Chief executive Rob Woodward said advertising revenues, which were up four per cent, are showing further signs of improvement after several tough years.

“We are expecting a continuation of the very muted single digit growth through the rest of the year,” he told City A.M.

He added that the plan to pay out a 1.5p per share dividend “is a sign of the confidence the board has in a return to growth for the company”.

Net debt at the firm was cut by more than a fifth to £43.4m, under Woodward’s goal of “operational leanness,” which has seen the firm sell off Virgin Radio in 2008 and cinema advertising group Pearl & Dean for a nominal £1 in 2010.

The Scottish firm has also cheered a number of new commissions, including a second series of the revived version of Catchphrase for ITV, which has driven production revenues up 84 per cent.

Digital revenues were up 19 per cent in the half-year, boosted by new mobile platforms and continued growth in its STV Player.

Peel Hunt analyst Patrick Yau said the results had “many operational positives coming through”.

“Importantly, there are no negative surprises and, with the consumer outlook showing signs of improvement, we maintain our forecasts for the year on rising confidence,” he wrote in a note to clients.

Shares in the firm closed up six per cent at 184.5p.

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