ITV’s revenue up and profit down as I’m a Celeb broadcaster invests heavily in streaming and on-demand TV
ITV had a mixed 2022 thanks to “deliberate strategic actions”, as revenue went up almost seven per cent while profit dipped due to lower advertising intake.
The TV channel and on-demand service reported studio revenue of more than £2bn, a 19 per cent rise on 2021 by more than £300m. Its total group revenue was £4.3bn, a seven per cent increase on the previous year.
ITV however had a dip in its total ad revenue by one per cent leading to a £96m fall in its group earnings before interest, taxes, and amortisation, to £717m.
The commercial broadcaster known for shows including I’m A Celeb, Nolly and Love Island, said the dip in profits reflected “planned investment in M&E (media & entertainment) to drive future growth”, partly funded by £23m in cost-savings.
It also said there had been a massive uptick in production of “high-end scripted hours produced”, increased by 58 per cent, as ITV battles with other paid-for streaming services like Netflix for eyeballs. The broadcaster said there had been a “significant increase in the volume of content available for streaming from 4,000 in 2021 to 19,000 hours” last year.
The result is digital revenues being up 18 per cent to more than £400m, while total streaming hours increased by nine per cent. UK subscribers are now at 1.4m
ITVX, the broadcaster’s on-demand service, attracted 1.5m new registrations, with streaming hours growing by almost 70 per cent.
Following its results its chief executive Carolyn McCall said ITV’s new on-demand service rolled out in Q4 “has received a very positive reception from viewers and advertisers alike”.
She said revenue growth was driven by “ITV’s deliberate strategic actions and strong execution” which was helped by its “scaled and expanding global production business” and “a rapidly growing targeted digital advertising business.”
“This means that ITV is now a demonstrably more balanced business which is ideally placed to take advantage of the growing demand for quality content from viewers, broadcasters and streamers and take a larger share of the digital advertising market.”
Looking ahead to 2023, ITV said the “outlook for advertising is challenging”, but it expects ITV Studios to deliver at least five per cent average revenue growth per annum to 2026, and it is keeping too its adjusted EBITA margin guidance of 13 to 15 per cent from 2023 onwards.
“Given the current inflation in the production market and general cost inflation, we expect the margin to be at the lower end of the range in the shorter term, as we previously guided.”