ITV's shares shot up five per cent in early trading as revenue climbed eight per cent to £2.6bn in 2014 and adjusted pre-tax profit jumped 23 per cent to £712m.
The UK's largest broadcaster will pay out a special dividend of £250m to shareholders, or 6.25 pence per share. That's in addition to a 3.3 pence per share final dividend.
Ad revenue grew six per cent to £1.63bn and its production arm ITV Studios grew nine per cent to £933m.
Non-ad revenue also grew 10 per cent to £1.3bn, driven by its online, pay and interactive business which grew 30 per cent. The business includes one of its first new channels in almost a decade, the paid-for ITV Encore.
Why it's interesting
ITV has been splashing the cash on original programming to stem its declining audience share – its latest effort is making a bid for The Voice producer Talpa Media in a bid to attract viewers. Although that strategy looks like it's paying off, cash-wise, the broadcaster's viewer share continued to decline.
The recovering economy has shored up ad revenue at the broadcaster as brands return to TV spending, and this is its strongest outperformance of the rest of the market for five years.
What ITV said
While our share of viewing on linear TV was down in 2014, we are firmly focused on improving viewing this year. Up and coming new dramas include Jekyll & Hyde, Home Fires, Arthur & George, The Trials of Jimmy Rose, The Forgotten and Safe House as well as the return of Doc Martin, Prey, Downton Abbey and Vera. Thunderbirds Are Go is back on our screens this spring – and we have the exclusive rights to the Rugby World Cup which takes place in the UK this autumn.
An increasingly important, profitable and high margin part of our business is online, pay and interactive. In 2014 our video on demand viewing was up 26 per cent as we further improved the quality and distribution of ITV Player, which is available on more platforms than ever before, most recently Windows Phone 8 and Amazon Kindle Fire. ITV is well placed to take advantage of the growth in viewing on connected TVs, including through our investments in YouView, Freeview Play and Freesat.
Double-digit growth, a money-making international production business and ad revenue that outstrips the market is all good news for investors. However, attempts to stem a decline in viewership will be an annoying thorn in chief Adam Crozier's side amid those figures moving upwards.