STV warns over profits as advertising market slumps and TV projects delayed
STV said it was now expecting full-year revenue and adjusted operating profit to be 'materially below' a consensus of analysts.
Revenues are predicted to range between £165 million and £180 million for 2025.
The company said it was now targeting £2.5 million worth of cost savings this year – higher than the £1.7 million outlined in March – having launched a significant savings programme last year, including across its broadcast operations.
STV blamed worsening conditions in the commissioning and advertising markets in recent months for the profit and sales downgrade.
Advertising revenues for the period between July and September is forecast to decline by 8%, lower than previously expected, driven by a sharp 20% drop in July, it told investors.
The year-on-year decline is set to be impacted by particularly strong sales this time last year, due to the men's Euro football tournament being broadcast on TV.
It follows a 10% fall in advertising revenues over the first half of 2025.
A number of businesses, including WPP and S4 Capital, have flagged a worsening advertising market as more challenging economic conditions prompt clients to reign in marketing spending.
Furthermore, STV warned the uncertainty was causing significant deterioration in the commissioning market.
It said projects within its unscripted labels were being impacted with some in advanced development not getting the green light, and others being delayed into 2026.
Nevertheless, it highlighted strong progress within its scripted labels with current projects including for Netflix, Apple, Sky and the BBC.
Rufus Radcliffe, STV's chief executive, said: 'The deteriorating macroeconomic backdrop continues to lower business confidence impacting both markets in which we operate.
'STV Studios' delivery schedule for the remainder of 2025 has been impacted by the UK commissioning market, which has further weakened at the end of H1 (the first half of 2025) and into the second half of the year.'
But he said production had finished on 'key titles with international appeal, including high-end drama Amadeus for Sky and a third series of Blue Lights for BBC One'.
'We are proactively responding to market conditions through a combination of investing in targeted future growth initiatives aligned with our long-term strategy and identifying efficiency and cost saving opportunities across the business,' Mr Radcliffe added.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Daily Mail
31 minutes ago
- Daily Mail
Rolls-Royce's value rockets to £100B, up 1,000% since 'turbo tufan'
Rolls-Royce shares soared to a record high yesterday as its value hurtled towards £100billion for the first time. On a blockbuster day for investors, the stock rose as much as 12 per cent, taking gains for the year to more than 85 per cent. Rolls is up more than elevenfold – or more than 1,000 per cent – since 'Turbo' Tufan Erginbilgic (pictured) took over as chief executive at the start of 2023 when the engineer was worth just £7.9billion. Last night it was valued at £89.5billion, making it the fifth-biggest London-listed company. The rally came as growing demand for its engines, which power commercial aircraft and military fighter jets, led it to upgrade profit forecasts. Erginbilgic, who has been credited with turning the 119-year-old company around, now expects profits of between £3.1billion and £3.2billion, having previously targeted £2.7billion to £2.9billion. It came after the Derby firm reported a 50 per cent leap in first-half profits to £1.7billion, while revenues rose 11 per cent to £9.1billion. 'Having already delivered a stellar turnaround, Rolls is showing no signs of taking its foot off the pedal,' said Russ Mould of AJ Bell. 'Rolls is the poster child for what's capable on the stock market – a welcome reminder that Britain has plenty of business champions.' Erginbilgic said it had overcome supply chain and tariff challenges, and was on target for profits of up to £3.9billion by 2028. Demand has been boosted by the recovery of international travel since the pandemic. In the first six months of the year, Erginbilgic said it improved the time its engines spend 'on wing' – meaning the hours engines spend powering planes before needing maintenance. That lifts profits, as Rolls makes money from its engines' flying hours. By increasing durability, Rolls is expecting a more-than-80 per cent improvement in flying time for its Trent engines by 2027.
Reuters
31 minutes ago
- Reuters
Pearson sees growth accelerating in the second-half
LONDON, Aug 1 (Reuters) - British education company Pearson (PSON.L), opens new tab said it expected growth to step up in the second half after it reported a 2% rise in both underlying sales and adjusted operating profit for the six months to end-June on Friday. "We are making rapid progress with bringing AI-powered products to market and are scaling and enhancing our enterprise business with a range of new partnerships and deals," Chief Executive Omar Abbosh said. The company had expected low single-digit underlying sales growth in the first half.
Daily Mail
31 minutes ago
- Daily Mail
Should big British banks face a windfall tax as profits soar?
A windfall tax on the profits of Britain's four biggest banks would boost Treasury coffers by billions of pounds, according to a report from think tank Positive Money. Taxing the profits of Barclays, NatWest, Lloyds and HSBC could raise more than £11billion for the Treasury, according to analysis by the think tank which campaigns for monetary reform. It comes as Britain's four biggest banks posted big profits for the financial year 2024/25 in their half-year results. The think tank said Britain's Big Four banks - Barclays, NatWest, Lloyds and HSBC - are on track to make a record £48billion profit in 2025, based on their results for the first half of this year. Barclays' saw pre-tax profits rocket 23 per cent to £5.2billion for the six months to 30 June. Meanwhile NatWest reported an 18 per cent rise in its first half profit to £3.6billion. Lloyds reported its pre-tax profit rose to £3.5billion in the six months to June, while HSBC saw pre-tax profits fall 26 per cent to £11.9billion ($15.8 billion) in the first half of the year. Collectively, their pre-tax profits for the first six months of this year stand at £24.1billion. Positive Money proposes a levy of 38 per cent on the estimated full-year net income for the Big Four's UK retail banking operations - which it forecasts to be £33billion - above a £800million threshold would deliver an £11.3billion boost to the Treasury. Should we have a windfall tax on banks? Positive Money's argument for a windfall tax is that banks are 'an essential public utility' like energy, and profits should be recouped accordingly. Simon Youel, head of policy and advocacy at Positive Money, says: 'Just as energy companies shouldn't be able to profiteer, neither should banks - taxing windfalls makes sense for both.' HSBC, Barclays, Lloyds, and NatWest reported pre-tax profits of £45.6billion for 2024, fuelled by higher interest rates. This was more than four times the profits recorded in 2020, before interest rates started rising. 'The government is quietly handing over tens of billions of pounds a year to the Bank of England to cover the costs of higher interest rates, much of which is ending up in the pockets of banks' shareholders,' says Youel. At the same time, the Chancellor is searching for funds to repair Britain's fraying public finances and there has been speculation that banks' strong gains could make the industry a tempting target for a tax raid by the Chancellor in her autumn Budget But the UK's biggest bank bosses have warned in no uncertain terms that levying bigger taxes on banks would strangle the growth the Government is grappling for. NatWest boss Paul Thwaite has warned Rachel Reeves against a tax raid on banks, saying: 'Strong economies need strong banks.' 'What I want to do is use the bank's capital to invest in the business but also to support customers. If we do that, that supports the wider UK growth agenda,' he added He is joined by Charlie Nunn, chief executive of Lloyds Banking Group, who said increasing taxes on banks 'wouldn't be consistent' with helping them boost the economy. Most recently Barclays boss CS Venkatakrishnan warned against additional taxes on banks. He said 'Growth is the primary objective for the UK and a higher taxation of businesses is not a path towards that growth.' How would a windfall tax on banks work? The windfall tax on banks proposed by Positive Money would be in line with the Energy Profits Levy on oil and gas companies. This windfall tax was introduced by the Government in May 2022 in response to soaring energy company profits following Russia's invasion of Ukraine. The increase in energy prices sparked by the invasion led to bumper profits for energy companies, prompting to calls for a windfall tax. It is currently set at 38 per cent on profits and in the financial year 2023/24 the levy raised £3.6billion from oil and gas company profits. Positive Money says a bank windfall tax would follow in the footsteps of countries like Spain which recoups banking windfalls through a levy of 4.8 per cent of banks' net interest and commission from domestic retail banking above a threshold of €800million. If it were to be implemented in the UK, Positive Money says it would raise enough money to scrap the two-child benefit cap, estimated to cost the Government up to £3.5billion annually, and cover the cost of its recent u-turn on welfare. However, an International Monetary Fund report on the Spanish economy in 2024 found 'windfall levies do not constitute a growth-friendly consolidation strategy'.
