ITV today pledged to reinstate its full-year dividend after the embattled broadcaster said it was emerging from the worst effects of the pandemic.
The London-listed company said that while it will not pay an interim dividend due to ongoing uncertainty related to Covid, it planned to resume its payout at the end of its 2021 financial year.
This will be a dividend of 3.3p per share, based on two-thirds of a notional full-year dividend of 5p. ITV, which scrapped its payout at the height of the pandemic in March last year, said it planned to grow the dividend over time.
It came as the public service broadcaster reported sharp rises in revenue and profit for the six months to the end of June.
Total external revenue rose 27 per cent to £1.5bn, with a 29 per cent increase in total advertising revenue and ITV studios up 26 per cent.
Statutory pre-tax profit was £133m, up from just £15m in the same period last year.
Shares in ITV ticked up almost two per cent in early trading.
Ads bounce back
While the figures benefited from soft comparatives at the height of the pandemic, ITV hailed a “strong rebound” in both advertising and its production business.
The channel enjoyed its largest ever month for advertising revenue in June thanks to the delayed Euro 2020 tournament and the return of Love Island, coinciding with the easing of lockdown measures.
Video on-demand advertising jumped 55 per cent, marking a boost for the company’s efforts to bolster its streaming offering.
ITV Studios also produced six of the top 10 scripted dramas in the UK, including Line of Duty, Pembrokeshire Murders and Unforgotten.
Total viewing fell six per cent in the first half after TV channels enjoyed record audiences during the pandemic last year. However, registered users on ITV Hub were up seven per cent to 34.6m.
ITV boss Carolyn McCall played down speculation that the company could make a bid for a stake BT Sport after the telecoms giant said it was exploring a possible sale.
“We’re not in the market for that kind of acquisition,” she said, but added the broadcaster was in constant discussions with BT over potential collaborations.
ITV warned of tougher comparatives in the second half of the year, meaning its growth is likely to slow. But it forecast advertising revenue to be 68 per cent higher in July and up as much as 20 per cent in August.
McCall added that there was an on-going threat to production from the so-called pingdemic amid a sharp rise in the number of Brits being told to self-isolate.
The TV boss said the company was in talks with the government over a potential relaxation of the rules for staff working on some services such as news and daytime.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: “The picture is still fuzzy regarding the spread of new variants, but a fresh easing of restrictions should help boost margins for its production arm.
“But it could mean that there will be fewer eyes on screen during the key Autumn TV season, if more people find the confidence to go out socialising more.”
ITV added that it was on track to hit its cost-saving targets of £30m for the year.
“Our first half results demonstrate that ITV is emerging from the worst effects of the pandemic,” said chief executive McCall.
“We are now a more flexible, more efficient and more digital business. We have successfully completed the first phase of our More Than TV strategy and look forward to building on this platform to accelerate our transformation to a digitally led media and entertainment company.”