ITV Profit Triples to $517 Million as Ad Market Recovers
But U.K. broadcaster sees a fall in revenues and profits at ITV Studios.
LONDON -- Commercial broadcaster ITV coasted to near-tripled profits of £321 million ($517 million) in 2010 on the wave of a resurgent advertising market and Simon Cowell not feeling like a change -- yet.
The network, whose biggest shows include The X-Factor, Britain's Got Talent, and period drama Downton Abbey, said full-year revenues were up 10 percent to £2.06 billion ($3.3 billon), driven by a 16 percent increase in TV revenues.
Under chief executive Adam Crozier the broadcaster has seen its share price almost double in the last 12 months, trading up 5 percent at 92 pence ($1.48) per share on the news, after hitting lows of 47 pence (76 cents) in the summer.
ITV's biggest problem still remains, however: it doesn’t make enough of its best shows. X Factor, Downton and Got Talent are all produced out of house and it means that the network's commercial success is overly reliant on external suppliers.
ITV bosses still won't say whether Simon Cowell will continue to front X Factor, its most commercially successful show, when he begins work on the show's U.S. launch on Fox this fall. Company sources maintain only that talks are "ongoing." If Cowell quits -- and as is rumored, takes fellow judge Cheryl Cole to work on the Fox show -- ITV's all-important fall schedule would be very exposed.
Meanwhile, chief executive Crozier acknowledged the weakness in ITV's production capacity -- which was underlined by a fall in revenues and profits over the past year at ITV Studios, its production factory.
The division's profit was down 12% to £81 million ($132 million), which ITV said was due to lower international production revenue. Since coming in a year ago Crozier has entirely overhauled ITV Studios' management team, bringing in Kevin Lygo to oversee production, and the CEO said the "creative renewal" process was still ongoing.
“We’re still in the first phase of our transformation and making good progress, with a real momentum for change being built up within ITV," said Crozier. "We have a new, talented top team in place and around a third of the wider leadership team has changed over the last few months. The organization is becoming leaner and a further £15 million ($24.4 million) of overhead and cost reduction is expected to be delivered this year."