Love Island lifts ITV as advertising sinks
MAKING hit shows such as Love Island boosted ITV even as it was hit with a sharp fall in advertising. The company yesterday revealed a bruising 8pc drop in advert revenues to £769m for the six months to June 30.
But it also said ITV Studios, which makes The Voice, Saturday Night Takeaway and Poldark, continued to grow and was up 5pc to £306m.
The figures underscore progress made by former boss Adam Crozier to reduce the broadcaster’s reliance on advertising cash – but experts say there is more to do.
Earlier this month ITV unveiled a new chief executive, EasyJet boss Dame Carolyn McCall.
ITV’s runaway reality TV hit Love Island ( pictured) drew to a close this week, attracting 2.6m viewers on Tuesday. The show has drawn record audiences for ITV2, including a 15pc rise in 16-to-34-year olds. This was a striking success with many in this age group abandoning traditional television for on- demand services.
ITV chairman Sir Peter Bazalgette said it was proof younger viewers could still become glued to the screen if it featured ‘great content’ amid growing competition from internet streaming services Netflix and Amazon.
The 64- year- old, known for bringing Big Brother to UK television, said yesterday: ‘ Love Island is Love Island. It is a really delightful show. I think it hits the mood of the times. It is romantic, positive, upbeat and it demonstrates that young viewers engage in great TV content.’
But he denied services such as Netflix posed a threat, after the US rival revealed it now had 100m subscribers worldwide.
He added: ‘We welcome them in the marketplace. But ITV has a 21pc share of viewing in the UK and Netflix, if it was a channel, would have about 4pc. It is pumping a lot of money into content though and we see that as very positive for our studio business.’
Continuing to expand ITV’s production arm and overhauling its business would be among the top jobs for McCall, he said.
The EasyJet boss checks in at the company in January 2018 and faces a number of challenges – not least weaning it off its reliance on advertising revenues and growing its online offering.
Bazalgette said Britbox, the paid-for streaming service for British programmes ITV has teamed up with the BBC to provide abroad, had launched successfully and would now be more widely promoted.
George Salmon, equity analyst at Hargreaves Lansdown, said the results showed McCall would have to fly ITV through a ‘difficult environment’.
He said: ‘A significant portion of group revenue still comes from selling advertising space.
‘However, in other areas, performance looks pretty good.
‘The phenomenal success of Love Island has provided a shot in the arm, while big names like The Voice and Britain’s Got Talent remain essential viewing. Investors will be hoping content like this will help ITV fend off the challenge presented by rivals such as Netflix and Amazon.’