ITV Revenue Plummets $390M After Coronavirus Shuts Down 230 In-House Shows, But Green Shoots Of Recovery Emerging

Good Morning Britain
ITV's Good Morning Britain ITV

ITV has posted its earnings for the first half of 2020, and unsurprisingly it is not a pretty picture after the coronavirus pandemic wiped out advertising revenue and shut down production. But the UK commercial broadcaster and production powerhouse said there is light at the end of the tunnel.

ITV’s total group revenue in the first six months of the year dropped to £1.45BN ($1.9BN), down 17% from £1.74BN over the same period last year. ITV Studios’ revenue was also down 17% (£295M) to £630M, while advertising revenue fell 21% to £671M. In the second quarter, ad income was down a whopping 43% — the worst decline in ITV’s 65-year history.

Adjusted group EBITA halved to £165M and the company yanked its shareholder dividend “in light of continued economic uncertainty.” It said the dividend will be restored “as soon as circumstances permit.”

ITV CEO Carolyn McCall was stark in her reflections on the first half of the year. She said: “This has been one of the most challenging times in the history of ITV. I am really proud of the way that our colleagues have responded to the COVID-19 pandemic and helped demonstrate the enduring value of ITV.”

McCall struck an upbeat tone when looking ahead to the rest of the year, however. She said that “advertisers are returning,” with July being down 23% as car companies and retailers begin spending more money. ITV Studios has also remounted 70% of the 230 shows it was forced to halt during the height of the pandemic.

ITV Studios shows, such as Good Morning Britain, remained on air during the crisis, while brands including Coronation Street and The Voice in Australia have restarted filming in recent weeks. “There remain operational challenges with producing content, particularly on large entertainment and reality shows along with dramas due to travel restrictions and social distancing rules, however we are working hard on this,” ITV said, adding that it expects “increased costs” due to safety protocols.

On an earnings call following the publication of its earnings, McCall added that a “large number” of dramas will begin shooting again over the coming weeks, including Gomorrah and Summertime. Apple series Physical and HBO Max animation Ten Year Old Tom will also film in the second half of the year. McCall also pointed to Love Island Season 2 going into production later this month for CBS. ITV Studios actually managed to grow its U.S. revenues 11% to £88M in the first six months of the year, due to a number of programs being delivered prior to the pandemic.

To deal with the havoc wreaked by coronavirus, ITV has previously said it intends to save £60M this year. It has already achieved £51M of this target, according to its first-half report. This includes extending 20% salary reductions for senior staff from the end of June to the end of October. Top brass have also agreed to forgo their 2020 bonuses.

As of last month, ITV had 1,500 on furlough. This has now fallen to 300 and is “reducing by the day because productions are restarting” according to McCall. ITV’s share price fell 4% to 58.48p in early market trading.

Elsewhere, ITV revealed that BritBox has grown its U.S. and Canadian subscription base to 1.2M after passing the million milestone in March. The streamer will launch in Australia later this year before heading to 25 other countries.

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