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EU Referendum Brexit ITV

ITV to cut 120 jobs in effort to plug gap in ad revenue sparked by Brexit

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By Tony Connelly, Sports Marketing Reporter

October 24, 2016 | 3 min read

ITV has cited the political and economic uncertainty steaming from Brexit as the reason for cutting 120 jobs as part of a £25m cost saving strategy intended to plug the gap in declining ad revenue.

The broadcaster hopes that the job cuts will help meet £25 cost savings target

The broadcaster hopes that the job cuts will help meet £25 cost savings target

Prior to the EU referendum the UK advertising market which had been expected to rise more than 7% this year following a 10% increase in 2015. However, the negative impact on the economy following the result led to a decline across the board which hit the advertising indutry. This has been intensified in recent weeks due to the growing concerns of a “hard Brexit” which have forced media agencies to increasingly cautious and resulted in a projected 2% annual decline.

The forecasts predict that UK broadcasters will endure the worst year for TV advertising since 2009 and have forced many to implement quick cost saving measures.

ITV chief executive, Adam Crozier, warned in July that the Brexit vote would mean it had to save £25 in cost savings next year. The £1bn-plus annual programming budget will remain unchanged at this time, meaning that the cost saving measures will take the form of job cuts.

Of its 6,000 employees ITV currently has 3,000 staff in the UK with the US making up its next largest workforce. It is unclear which regions the cuts will affect.

An ITV spokesman said: “At a time of political and economic uncertainty in our key markets, it’s important that we are in the strongest possible position to continue to invest in our strategy and to meet any challenges and opportunities ahead, as we continue to grow a successful business.”

ITV has grown its revenue streams outside of the UK in recent years and Crozier has worked to reduce the broadcaster’s reliance on advertising with the creation of a large TV production operation in the US.

It continues to heavily depend on the UK market though which accounted for around 85% of the £3bn it made last year. The attempts to offset its dependence on advertising have also been slow with TV ads and sponsorship still accounting for more than half, or about £1.7bn, of its revenues.

Last month, ITV’s share price fell significantly after Crozier and finance chief, Ian Griffiths, sold £2m worth of shares, leading investors to speculate that it could be a sign that its stock market price may be close to its peak.

EU Referendum Brexit ITV

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