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Edinburgh and Glasgow reach 1m viewers

STV sees rise in advertising revenue on back of new launches

STV catchphraseSTV saw profit and revenue rise on the back of an improved television advertising market which enabled the company to lift its dividend by 300%.

It said the newly launched Glasgow and Edinburgh local stations were reaching more than a million viewers and that new advertisers had been drawn to new platforms. Many clients were spending more  with STV and marketing their brands and services across a number of assets in the STV Family.

STV Glasgow was launched in June and achieved target revenue of £600,000 during the second half. It is expected to achieve a breakeven run rate in H2 of 2015. STV Edinburgh launched on schedule last month.

Digital revenues continued to grow year on year, up 23% to £5.3m (2013: £4.3m)

STV Productions has continued to develop and secure returning formats during 2014, but it was below target in the second half of the year and as a result revenues fell from the £16.8m target to £13.3m, broadly flat on the year.

The business achieved a margin of 3%, behind the target of 5%.  In 2014, the number of hours produced totalled 164, including in-house STV commissions.

Returning series commissions were secured for Catchphrase (ITV), The Link (BBC One), Antiques Road Trip (BBC One) and Celebrity Antiques Road Trip (BBC Two) and The Lie (TV3).

Catchphrase was commissioned for a further 13 episodes, including three celebrity versions. The Link aired for an initial run of 25 episodes and a second series of 40 episodes were ordered for BBC One daytime. 

Antiques Road Trip and Celebrity Antiques Road Trip also returned to BBC One and BBC Two following a March announcement for four new series of Antiques Road Trip and one new series of the celebrity version. This takes the total number of series to 12 Antiques Road Trip and four Celebrity Antiques Road Trip. A further fifth series of Celebrity Antiques Road Trip was commissioned in November and is expected to air in 2015.

The Lie, was re-commissioned for TV3 in Ireland and STV in Scotland.  A format deal was also agreed with S4C / Cwmni Da for eight episodes for Welsh audiences to air in 2015. The second run of The Lie totals 60 episodes across the three broadcasters.

Two successful specialist factual documentaries aired on BBC One and BBC Two attracting high levels of interest. Tutankhamun: The Truth Uncovered was an international co-production with STV Productions and Cream Productions, Canada for BBC One, Discovery Canada and Smithsonian Channel. Swallowed by the Sea: Ancient Egypt’s Greatest Lost City aired on BBC Two.

In addition to focusing on securing returning commissions, a priority for the business is to secure success in the drama genre.  During 2014, a newly appointed head of drama was announced in a bid to bring renewed focus and success in this area.

The business also continued to work with GroupM on a number of co-development projects, including a documentary for Channel 5, Britain’s Worst Roads, and the ITV entertainment series Let Me Entertain You.

Group operating profit was up 8% to £19.5 million on a 7% rise in turnover to £120.4m. A recommended final dividend of 6p will make 8p for the full year, up 300% on 2013.  Subject to achievement of 2015 financial targets, a payment of 10p per share for 2015 is planned and it remains the intention of the board to continue the progressive dividend policy in future years.

Jamie Matheson will retire from the board at the forthcoming annual general meeting after eight years.

Rob Woodward, chief executive, said:“These are another strong set of results that show good progress against our strategic aims and growth KPIs across our consumer business. Our focus on our consumers, who we are serving with new and enhanced services, is enabling us to grow our commercial market share as we provide our advertisers with an increased range of ways of reaching their target markets.”

Malcolm Morgan, analyst at Peel Hunt, said: “Results were in line with expectations, other than a bigger than expected step up in the dividend.” He increased his target price to 530p. The shares closed up 7p at 380p.

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