STV in ‘strong’ position as profits are ‘well ahead of market expectations’

STV’s 2020 operating profit is expected to be comfortably ahead of market expectations.

“2020 finished strongly and we expect to report an operating profit and net debt position well ahead of market expectations, underscoring the resilience of our business, the loyalty of our viewers and our strong digital growth trajectory.

“We’ve set new viewing records on screen and online, with TV viewing up 14% and STV Player viewing up 68% in 2020.” -Simon Pitts, STV Chief Executive

The STV Group plc this week announced that it expects operating profit for the year ended 31 December 2020 to be at least £18m, comfortably ahead of market expectations, driven by a stronger than expected regional and digital performance.

STV-controlled advertising continued to outperform the wider advertising market, with regional advertising up 8% in H2 and down just 5% for the full year, delivering growth in 5 of the last 6 months of 2020.

Video on Demand advertising on the STV Player continued its strong growth, up 11% in H2 and +12% for the full year, finishing 2020 with 4 consecutive months of growth.

“STV-controlled Scottish advertising and digital advertising both continued their strong recovery in H2, driven by our advertising Growth Fund and the continued success of our streaming service, STV Player, which is now available in 70% of the UK’s connected homes following recent launches on Freeview, Virgin and Sky.” -Simon Pitts, STV Chief Executive

STV’s total advertising revenue improved to broadly flat in Q4, with November -1% and December +3%. This followed a Q3 of -4% and Q2 of -38%. The decline in total advertising revenue for the full year has narrowed to -10%.

The combination of digital revenue growth, strong cash collection and management actions will result in the company reporting a net debt position significantly better than current market expectations, and less than £20m.

STV’s record viewing performance on TV and online continued, with TV viewing finishing 2020 up 14% and STV Player up 68%, the fastest growth of any broadcaster VOD service in the UK.

The UK and Scottish governments have confirmed that TV production can continue during the current lockdown, resulting in very little impact on STV Studios’ production schedule so far, with Covid safety protocols continuing to work well.

“Despite the ongoing challenges around Covid-19, we have managed to accelerate our strategy and remain confident in our prospects for growth. We have a strong programme line-up in Q1 across STV and the STV Player, with more bingeworthy drama than ever before, while in STV Studios our slate of new commissions means that 2021 promises to be our most successful year yet.” -Simon Pitts, STV Chief Executive