Core audience

6 August 2008 By Una Galani Follow @ugalani

The freetoair broadcaster is openly predicting a terrible time ahead. It has slashed its dividend, revised its own turnaround targets and unveiled a new costcutting plan. ITV will certainly be hoping to get sympathy from its most important audience the regulator.

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ITV on Wednesday said its net advertising revenue would likely fall 20% in September, signaling a rapid deterioration of the market. The freetoair broadcaster halved its dividend and revised some of the targets of its turnaround strategy outlined by executive chairman Michael Grade last year.

Net advertising revenues were flat in the first eight months of the year, compared with a 1% fall in the wider market. First half group sales rose 3% to £1bn ahead of expectations, and profit before tax also beat expectations.

ITV now targets an extra £35m of cost savings by the end of 2010 and has halved its interim dividend to 0.00675p. ITV also took a noncash impairment charge of £1.6bn as a result of reduced advertising market forecasts for this year and next.

In its global content business, ITV said it now targets a revenue run rate of £1bn by end2012, instead of doubling its revenues to £1.2bn. In online, it delayed its £150m revenue target to the end of 2012 from 2010.

ITV shares fell up to 9% to 42p on the news.

Context News

ITV shares fell up to 9% to 42p on the news.

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