The new chief executive of STV Group may well have a had a smile on his face today, after shares in the broadcaster moved in a favourable direction on the day he delivered his first update to the City.
Shares in the Glasgow-based firm rose nearly 7% after it reported a 5% rise in total advertising revenue (TAR) before commission in the third quarter, ahead of guidance, and signalled its expectations of meeting its guidance for the full year. This is despite an expectation that TAR will decline by around 10% in the fourth quarter because of strong comparators with last year, which included the Rugby World Cup in France.
In its first update under Rufus Radcliffe, who succeeded Simon Pitts on November 1, STV once more highlighted the strength of its productions business, STV Studios, which is “winning commissions despite constrained budgets and delivering in a continued inflationary environment”, while helping to offset “ongoing weakness in the linear TV advertising and commissioning markets”.
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The company said it expects TAR for the full year to be up 2% to 3%, adding that its cost savings plan is expected to deliver savings of at least £1.5 million.
“I joined STV on 1 November and have been very impressed by its strong foundations and prospects for future growth,” said Mr Radcliffe, who arrived the firm after a 13-year stint ITV. “I’ve been struck by the creativity, dynamism and commitment of the team and I look forward to working closely with them to build on recent successes.
“There’s no doubt that we continue to operate against a challenging advertising and commissioning backdrop, and we will continue to take action to mitigate against that where possible. The acquisition strategy in STV Studios is helping us to deliver in a tough market, with new commissions secured for original formats since our interim results.
“We expect the full year TAR to be up 2-3%, boosted by the Euros earlier this year. The winter schedule brings the return of entertainment juggernaut, I’m A Celebrity Get Me Out Of Here, and The 1% Club. And looking further ahead, we have a strong drama offering at the start of 2025 on STV and STV Player.”
Shares in STV were up trading up 6.7%, or 13p, at 207p at around 15.45pm.
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