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ITV rebounds from £205m Covid slump as 11m watch Harry and Meghan

Mark Sweney
·3 min read
Photograph: Facundo Arrizabalaga/EPA
Photograph: Facundo Arrizabalaga/EPA

The coronavirus pandemic wiped more than £200m off ITV’s profits last year but the broadcaster has said there are signs of a strong recovery in TV ad revenues, helped by Oprah Winfrey’s sensational interview with Prince Harry and Meghan.

ITV reportedly paid £1m for the exclusive UK rights for the interview, aired on Monday night, and its chief executive, Carolyn McCall, said that price paid meant the broadcaster would only just cover its costs.

However, she added that the huge 12.8 million peak audience was important to overall deals with advertisers, and a string of follow-up programmes are planned.

Watch: The key revelations from Meghan and Harry’s Oprah interview

Related: ITV aims to cash in after bagging Harry and Meghan television gold

“We were glad to secure it,” McCall said. “There are a lot of programmes that will follow it. There will be a lot of context pieces that will follow the interview. We will extend it and make the most of that because that is what viewers are interested in.”

ITV’s profits fell 39% from £530m in 2019 to £325m last year.

Its total revenues plunged 16% to £3.3bn as the pandemic caused advertising to fall at the steepest rate in its history in April, and hit shows such as Love Island were pulled from the schedule after being unable to shoot during the lockdown.

The company returned to TV ad growth in the final quarter last year, as spending rebounded in the run-up to Christmas, but it was down 6% in the first three months of this year because of the latest lockdown.

Shooting has resumed on more than 90% of productions. ITV said that shows including Love Island and I’m a Celebrity … Get Me Out of Here! will return this year, although it said the production locations will be depend on any travel restrictions in place.

McCall tentatively hailed a recovery as Boris Johnson’s “cautious but irreversible” roadmap eases restrictions across the summer.

“We are encouraged by the roadmap out of lockdown,” she said. “We are seeing more positive trends in the advertising market in March and April and the majority of our programmes are now back in production. However, there remains uncertainty in all markets around the world with the potential risk of lockdowns, which if they materialise will affect revenues.”

ITV has forecast total ad revenues to be up about 8% this month, helped by advertiser demand for the royal interview, while April will be up 60% to 75% year on year. Revenues in the four months to the end of April are expected to be up between 5% and 7%. Last April, advertising fell by almost half.

Shares in the broadcaster, which has upped its cost-cutting target from some £60m to £100m by the end of next year, fell by 2% in early trading as it delayed reinstating its dividend. ITV also revealed that it had 2.6 million subscribers to its BritBox service internationally, with 500,000 in the UK.

“ITV has a lot of the right ideas, and the rise of our box set-binge culture means growing its content business offers huge potential,” said Sophie Lund-Yates, an equity analyst at Hargreaves Lansdown. “But as it stands, ITV is still a clunky operation, and relies heavily on traditional advertising spending.”

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