ITV shares soar as advertising spend picks up

BROADCASTING group ITV yesterday it expected demand for advertising to bounce back strongly this summer, recovering after it suffered from having no Olympics coverage a year ago.

The firm’s chief executive Adam Crozier said his talks with advertisers indicated that they were becoming more confident about spending.

“While that sentiment has shifted I don’t think that has quite yet turned into actual behaviour,” he said. “But I think it would be fair to say the fear of the downside seems to have largely diluted and people are now looking more positively.”

The company posted a better-than-expected 16 per cent rise in first-half profit, year-on-year, as its production business offset weaker ad demand.

Income from advertising across its channels fell by an expected three per cent in the half, the broadcaster said, but was coming back strongly.

It was expected to rise 12 per cent in July, 20 per cent in August and to be flat in September, compared with the same months in 2012.

This would produce a broadly flat first nine months of the year, ITV said, sending shares up 6.3 per cent to a 12-year high.

ITV has been building its production business, both by making more programmes for its own channels and other broadcasters, and by acquisitions in Britain and abroad.

Revenues in its production arm, which makes dramas such as Mr Selfridge and The Psychopath Next Door, rose 11 per cent to £395m, out of a overall company total of £1.3bn, while earnings from the unit increased 26 per cent to £63m.

ITV reported first-half adjusted pretax profit of £270m, up 16 per cent.