ITV shares dip despite broadcaster reporting rising revenue, profit growth, special dividend ahead of expected Euro football ad boost
ITV’s shares dipped this morning after reporting a worse-than-expected outlook for the first quarter of 2016, despite a strong set of full year results.
Total revenue across the company was £2.97bn, up from £2.59bn in 2014. The company reported a six per cent growth in net advertising revenue to £1.72bn.
Online, pay and interactive revenue, meanwhile, was up 23 per cent to £188m and ITV Studios turnover was up 33 per cent to £1.24bn.
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ITV’s adjusted earnings before interest, taxation and amortisation (Ebita) was up 18 per cent to £865m.
The broadcaster said its ordinary dividend per share would be 6p per share, up from 4.7p in 2014. And the board proposed a £400m “special dividend”, equivalent to 10p per share.
However, ITV warned that the European championships would affect advertisers' spending decisions over the next few months and therefore said it expects revenue to be flat for the first quarter.
In a note this morning, Investec said the outlook for ITV’s first quarter in 2016 was “worse than feared”, highlighting that the flat net advertising rate was below its already downgraded expectation of 2.5 per cent growth.
But the bank's analysts noted that the second quarter “should be better”, citing the football tournament.
ITV's share price fell 3.4 per cent in early trading this morning.
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Read more: ITV posts strong third quarter results
ITV chief executive Adam Crozier said: "Our strong cash generation and robust financial position gives us the flexibility to invest in growing the business while at the same time delivering returns to our shareholders.”