Thursday May 15, 05:10 PM
ITV shows signs of recovery
By Andrew Edgecliffe-Johnson and Emiko Terazono
ITV (LSE: ITV.L - news) on Thursday promised further cost-cutting and a freeze on its network programming budget and said the television advertising
market had so far held up "relatively well" in a softening economic environment.Michael Grade, executive chairman, urged shareholders at the broadcaster's annual meeting to give him more time as he sought to turn round a long period of creative and share price decline. "Please judge us on how we implement this plan over the next three to five years," he said, defending his strategy as "based on the top line, not based on cutting". Accused by one shareholder of "shoddy performance", Mr Grade pleaded for investors' patience. "Turning a company around this size and complexity in such a regulated climate, we have a lot of work to do," he said. A trading update showed group revenues were up 3 per cent in the first quarter to £492m, as growth in content sales and online income masked a 2 per cent fall from core broadcasting revenues to £409m. ITV's net advertising revenue rose 2 per cent during the quarter, which benefited from an early Easter. For the first half, it predicted that advertising revenue would be flat, slightly ahead of an expected 1 per cent decline in the UK TV advertising market. John Cresswell, chief operating officer, would give no detail on the further cuts he said ITV had identified from 2009, but Citigroup (NYSE: C - news) analysts estimated these could amount to £30m. News that ITV would keep the network programming budget flat in 2008 and 2009, rather than allowing increases of up to inflation, could also save £30m. Shares in ITV slipped 1p to 61.9p.
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