Reaction: STV's studio arm 'standout performer' as H1 revenues jump while profits retreat

Scottish broadcaster STV has cheered interim revenues growing by more than a fifth, with its rapidly expanding studios arm taking a starring role in catalysing this.

CEO Simon Pitts cheers the company’s studios arm proving its 'standout performer' in the period. Picture: contributed.

The London-listed media company, based at Glasgow’s Pacific Quay, cheered “excellent” revenue growth for the six months to June 30, to reach £75.3 million. However, total advertising revenue was down 14 per cent to £45.8m, but is expected to grow by 3 per cent to 5 per cent in the third quarter, driven by major sporting events including Rugby World Cup, and over the full year be up by at least 25 per cent.

Speaking to The Scotsman, chief executive Simon Pitts cheered the company’s studios arm proving its “standout performer” in the period, seeing revenues almost quadruple as it delivered new dramas including Screw for Channel 4, which was filmed at Glasgow’s Kelvinhall and is on screen right now.

He also cheered STV’s "transformative” £24m acquisition of unscripted TV production network Greenbird Media, which he said “turns our studios business into a major UK production player, and will add significant incremental profit in the second half of this year onwards”. Additionally, STV hailed its digital growth, with STV Player streams up 25 per cent, for example. However, adjusted operating profit was down by a third to £8m, and total profit for the period fell by 61 per cent to £3.3m.

Pitts also said: “As expected, we did see an impact on profits due to weaker linear advertising and the sorts of inflationary cost pressures that all businesses have seen". However he also said the group has “markedly” accelerated its diversification strategy in 2023.

He added: “Looking ahead, the market has been tough, but the advertising outlook is improving. We're expecting that more than 60 per cent of our profits will come from new growth areas this year, well ahead of our 50 per cent target, as we quickly become a more resilient and more balanced media business focused on the future.”

Analyst Johnathan Barrett of Panmure Gordon said STV’s first-half revenues were ahead of his team’s expectations of £67m, “with studios storming ahead – and more than offsetting the soft advertising market”. He added: “The macro environment is tough, but STV is executing on the strategy that is improving the groups long-term growth potential and profit diversification.”