ITV was one of the first UK broadcasters to sound the pandemic ad revenue damage horn. After publishing its first half results, we can now see the real effect of the downturn on the corporation, with ad revenue for the pandemic-hit April to June quarter tumbling 43%.
“This has been one of the most challenging times in the history of ITV," said chief executive Carolyn McCall.
The Drum unpicks ITV's H1 figures.
Total advertising revenue fell 43% in Q2 and 21% in H1, despite "good momentum" in Q1 when ad revenue was up 2%.
Ad revenue was down 23% in July, but this represented an improvement on the 42% drop in June and the 46% decline in May.
The ad revenue decline drove a 17% drop in total external revenue for the six months to the end of June to £1.22bn.
In March ITV Studios paused the majority of its productions. There was a 17% decline in ITV Studios revenue to £630m.
Earnings before interest, taxes, and amortisation fell 50% to £165m.
Efforts well underway to reduce overhead costs by £60m in total in 2020. £51m has already been saved. Hoping for £30m of permanent overhead cost savings by 2022.
People spent more time with ITV year on year. Total viewing was up 4%, family light was up 8%, online viewing up 13% and dwell time up 11%.
FMCG, retail, publishing, broadcasting, cars and interior furnishing categories are “beginning to spend more” again but recovery is dependent on the global Covid-19 situation. Government, charities and other, and publishing and broadcasting, were the only categories to grow spend across the period.
Addressable ad product Planet V launched, 100% of its VOD inventory will be executed there by 2021.
“With the significant increase in television viewing volumes during the pandemic, there has been huge price deflation in cost of television advertising, becoming 50-60% cheaper than before the pandemic,” it said. This encouraged some digital brands to try TV for the first time, it expects to keep some on board in the long-term.
It lost 4% share of voice among families blaming high traffic to BBC News.
Some production has returned. ITV Studios restarted limited shoots of Coronation Street and Emmerdale in June. The vital soaps that are a cornerstone of its programming and habitual viewers. Of the 230 productions that were impacted or paused by the lockdown, around 70% are back in production.
It furloughed 1,000 staff, 300 remain on furlough.
Direct to consumer: Reached 390,000 Hub+ subscribers. Reports “good growth” in BritBox subscriptions in both the UK and the US, and saw increased demand for ITV's competitions.
“Given the level of uncertainty for both ITV Studios and Broadcast it is not possible to provide financial guidance for Q3 or the remainder of the year.”
For the wider trends in the UK media, check out our highlights of the Ofcom Media Nation report.