- Predicts a 15% fall in ad revenue for Q1 2023
- Long-term benefits from partnership with ITV
- Record year for STV’s streaming service STV Player
Shares in Scottish free-to-air broadcaster STV (STVG) fell over 3% to 303.47p in afternoon trading as the company warned of a 15% fall in total advertising revenue (TAR) for the first quarter of 2023.
Scottish advertising is also expected to be down 20-25% in the first quarter of 2023, excluding Scottish Government spend.
For 2022 TAR was £110 million, down only 2% compared to 2021, and STV reported an 11% rise in pre-tax profit of £22.2 million for 2022 compared to £20.1 million in the same period last year.
A STREAMING SUCCESS FOR STV
The broadcaster said its enhanced long-term partnership with ITV (ITV) will propel the ‘next phase of streaming growth, guaranteeing exclusive access to 100+ hours of new, original UK content every year’.
STV also remains Scotland's most watched peak time channel for the fourth year in a row.
The 2022 FIFA World Cup and I'm A Celebrity...Get Me Out of Here! helped STV achieve a 25% viewing share in November, the channel's best-performing month since 2003.
Other highlights include STV’s diversification strategy which is ‘on track’ with 38% of earnings from Digital and Studios.
Simon Pitts, STV CEO (pictured), said: ‘Our diversification strategy, continues to accelerate, with digital profit up 9% and Studios profit up 6%. Nearly 40% of STV's earnings now come from these new growth areas as we reduce our reliance on traditional television and create a vibrant, future-facing media business.’
STV’s streaming service STV Player had another record year surpassing their target of five million registered users by early 2023.
A BREAKTHROUGH YEAR IN 2023
Pitts believes 2023 will be a ‘breakthrough year’ as STV delivers three major new dramas for Apple, BBC and Channel 4, following on from STV Studio’s success in last year winning 30 new commissions.
‘Our advertising performance should also be bolstered by a very strong content line-up which includes exclusive coverage of the men's Rugby World Cup starting in September.’
STV has proposed a final dividend of 7.4p bringing the total for the year to 11.3p, a rise of 3% compared to 2021.
Shore Capital analyst Roddy Davidson commented: ‘STV’s results detail another period of strong operational and strategic progress as it continues to execute its diversification strategy. Notable features include: the continuing development of STV Studios and the STV Player VOD platform and, notwithstanding macro headwinds and tough comps, a resilient advertising revenue performance and record profits.’
