ITV’s profits jumped in 2024 thanks to record earnings at the British broadcaster’s production arm, ITV Studios, as it benefited from hits including Mr Bates vs The Post Office, the Jilly Cooper adaptation Rivals and Fool Me Once.
The FTSE 250 company said revenues were down 3% to £4.1bn in 2024 compared with the previous year, but its measure of adjusted profits was up 11% at £542m. Profit before tax more than doubled to £521m, up from £193m a year earlier.
The company refused to comment on reports that it could consider a deal to merge or sell off ITV Studios. Carolyn McCall, ITV’s chief executive, said the board regularly reviewed options for the company’s future, and added that “every board everywhere has to keep all options open”, but said she would not comment on “speculation”.
ITV has been seeking to make itself less reliant on the volatile earnings from its UK broadcast TV channels, with investors expecting linear television to wither as the shift to online streaming services such as Netflix, Amazon Prime and Disney+ progresses.
Growth in ITV Studios has been key to that aim, outstripping revenues from advertising through traditional TV channels and ITV X, its own online streaming app. The production arm makes shows for ITV and for competitors, and it has benefited from the demand for big-budget dramas on top of commissions such as Line of Duty for the BBC – although 2024 sales were hit by writers’ strikes in the US a year earlier.
McCall said the focus on studios was “really paying off as a strategy”, and noted other efforts to diversify revenues including creating videos for Alphabet’s YouTube, a discount shopping app, and online games that earn revenues from younger audiences who do not otherwise tend to watch ITV programmes.
However, McCall has struggled to persuade investors, despite ITV Studios’ growth and a cost-cutting plan that found £60m in permanent savings in 2024. The company said it would save £30m more this year, without job cuts, including millions saved from licensing fees after ending standard definition broadcasting.
ITV’s share price is down more than 12% since July, despite rallying by 6% to 73.8p in early trading on Thursday after its results were released, and nearly half from the £1.30 levels reached during the coronavirus pandemic.
That share price decline came despite the potential bid interest late last year. Interested parties reportedly included the private equity company CVC Capital Partners, the French broadcaster TF1, RedBird IMI, which recently acquired the Traitors maker, All3Media, for £1.2bn, and the production group Mediawan, which bought a controlling stake in Brad Pitt’s Plan B Entertainment two years ago.
McCall said UK media companies were being undervalued relative to American rivals. She called on the UK government to remove stamp duty on share transactions and to “encourage pension funds in a more determined way to keep some of that money in the UK”. The Labour government is considering changes to try to increase UK investment from pension funds.
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ITV said its studios arm would “deliver good revenue growth in 2025”, although with profit margins falling. New shows will include the second series of Rivals, made for Disney+, Run Away for Netflix and the second series of the police thriller After the Flood for its main ITV channel.
Advertising revenues, most of which still come from broadcast channels, may be weaker in 2025 compared with 2024, when companies rushed to advertise at football’s Euro 2024. Restrictions on adverts for less healthy foods will also come in October 2025, potentially denting ad sales.
ITV retained its dividend for 2024 at 5p a share, the same £190m payout to shareholders as in 2023.
