ITV (ITV) 64.3p
Loss to date: -15.4%
Original entry point: Buy at 76p, 30 April 2020
Our hope that people’s increased engagement with ITV (ITV) through lockdown would begin to translate into increased advertising revenue is not yet in evidence.
The company may have seen increased viewing figures but first half results (6 Aug) also showed the worst quarterly drop in advertising on record as the impact of Covid-19 came through.
For the six months to 30 June, pre-tax profit plunged to £15 million from £222 million on-year as revenue fell 17% to £1.45 billion.
The company reported a ‘significant’ decline in demand for advertising across most categories with advertising revenue down 43% in second quarter and down 21% in the first half.
Traditional summer advertisers, most notably the travel and leisure industries, have been particularly exposed to coronavirus and ITV was also deprived a big sporting event after the Euro 2020 football championships were postponed by a year.
ITV Studios revenue dried up as most shows were put on hold through lockdown. However, there were some signs of recovery with July’s ad take being down a more modest 23% as car companies and retailers begin spending more.
On the production side, 70% of the 230 shows suspended at the height of the pandemic have resumed.
SHARES SAYS: We are keeping the faith for now.
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