Top drama series boost profits and revenue at STV
The Victim was a big hit
STV’s critically-acclaimed series such as The Victim, helped towards a 13% rise in underlying profits against a decline in national advertising revenue.
Adjusted operating profit came in at £22.6m (2018: £20.1m), the highest level in more than a decade.
Against a national advertising market that fell 4% year on year, total revenue decreased only 2% to £123.8m (2018: £125.9m).
The company said it is on track to deliver its diversification target of one third of profit from outside traditional television advertising by end of 2020, with non-broadcast earnings 28% of the total in 2019 (2018: 24%)
Simon Pitts, chief executive, said: “An operating profit increase of 13% when national advertising revenues are down illustrates our growing resilience and the exciting growth potential of our regional, digital and production businesses.
“In 2019 STV was the most popular peak time channel in Scotland, ahead of BBC One for the first time in 6 years; our Growth Fund has now welcomed over 160 new advertisers to TV since launch, underpinning strong growth in regional revenues; and our digital streaming service STV Player launched on Sky and became universally available for the first time, helping to drive 37% growth in both streams and revenue.
Simon Pitts: excellent progress
“These factors contributed to a strong full year performance, with EPS also up 13% and operating margin up over 230 basis points to 18%.
“We continue to make excellent progress with our strategic growth plan and have laid solid foundations for future growth, including in STV Productions where 2019 saw a return to high-end drama for the first time in a decade with the critically acclaimed The Victim and Elizabeth is Missing for BBC One.
“We also made two exciting investments in entertainment and drama companies to significantly strengthen our creative pipeline. 2020 has started with a range of new commissions and recommissions, including the biggest ever order for Antiques Road Trip and a new 10 part series for Discovery.
“Despite uncertainty following the UK’s exit from the EU and the Coronavirus, we are positive about the outlook for 2020. We have made a strong start to the year on screen and online, in line with our expectations, and have an exciting programming line-up to look forward to, with the return of Saturday Night Takeaway, Britain’s Got Talent and new dramas like Liar and Quiz all helping to drive viewing on STV and the STV Player.”
Total advertising revenue grew by 2% to £101.6m (2018: £100.0m) with gains in regional and digital offsetting the national market decline brought about by the political and economic uncertainty that defined 2019.
Reflecting the national advertising market, broadcast division revenues were down 2% at £92.3m (2018: £94.5m). Digital division revenue growth was strong, up 37%, to £13.0m (2018: £9.6m).
The increase in total advertising revenue was offset by lower revenues in STV Productions of £13.7m (2018: £16.3m) as the business was re-positioned under a new management team for future growth and a return to profitability.
There is a further increase in returns to shareholders with a recommended final ordinary dividend of 14.7p per share, giving a full year dividend of 21.0p per share, up 5% year on year.