STV hails ‘Scotland’s most watched TV moment of the year’ as revenues jump by fifth

Scottish broadcaster STV Group has hailed Euro 2024 as a “major audience and commercial success” as almost 1.4 million Scots tuned into the football tournament’s opener between Germany and Scotland.

Revealing solid first-half results, departing chief executive Simon Pitts claimed the Glasgow-headquartered group’s audience position was “unrivalled”, with STV being the most-watched peak time TV channel in Scotland, ahead of BBC1, and with nearly double the audience share of Netflix. He said the Euros had helped propel STV Player to its most successful first half-year ever in terms of streams. It also delivered the most watched TV moment of the year so far, with the Germany vs Scotland opening game peaking at 1.38 million viewers in Scotland, despite the disappointing outcome for the Tartan Army.

Pitts, who is due to hand over the reins to former ITV executive Rufus Radcliffe at the end of next month, said the advertising market had enjoyed “good growth” so far in 2024. He also noted that the forward order book for the group’s studios business was “stronger than ever”. Cost savings are on track, with STV on course to meet its £1.5 million target for the full year.

The Mr Bates vs The Post Office drama was a recent broadcasting success.

Pitts told investors: “Over the last six years, STV has been successfully transformed into a digital-first media company with a high-growth streaming service and one of the UK’s leading television production groups. This strong progress continues in 2024, with revenue and profit both up materially in the first half, reflecting our audience performance, the improving advertising market, and our creative strength in STV Studios, as we continue the successful execution of our growth plan.

“With high value recommissions of series like Criminal Record for Apple TV+ and The Fortune Hotel for ITV also secured, we have our strongest ever future order book in Studios at £101m in programme commissions. We are on track to deliver our stretching new growth targets out to 2026, and with a fantastic team in place I’m confident Rufus Radcliffe and the board will take the business to new heights in the years ahead.”

The interim results for the six months to the end of June showed that revenue was up 20 per cent to £90.4m, compared with £75.3m a year earlier. Total advertising revenue, pre commission, was up 13 per cent to £51.9m. Adjusted operating profit lifted by a third (33 per cent) to £10.6m. An interim dividend of 3.9p per share was declared, which is unchanged from a year earlier, after the group weighed up “all relevant factors including ongoing macroeconomic uncertainty”.

Over the first half of the year, regional advertising revenue was up 1 per cent at £7.4m, with core advertising from Scottish small and medium-sized enterprises (SMEs) up 12 per cent. STV was the most watched peak time TV channel in Scotland for the seventh first half-year in a row with a viewing share of 22.2 per cent.

Scotland's opening match against Germany at the Euro 2024 tournament on June 14 was a tough watch for Scottish fans.

The average STV viewer is said to spend 1 hour 45 minutes with the channel each day. Mr Bates vs The Post Office was the biggest drama launch across all channels and streamers in the first half.

Bosses said the STV Studios business was growing in a tough market, with the group’s investment strategy “delivering tangible results”. Having increased its stake from 30 per cent to a majority 51 per cent in fellow Glasgow-based unscripted formats creator Hello Halo, the deal is said to be generating a strong return on invested capital.

Issuing a “buy” note on STV’s shares, brokerage Panmure Liberum noted: “[First-half] revenues were ahead of expectations with Studios activity the big surprise set against tough industry conditions. While the company is not seeing an industry wide pick up in content demand, its strategy is delivering commissions and lifted the forward order book to over £100m for the first time.

“The strength of the strategy has diversified the business and added resilience. A new CEO has been announced ensuring an orderly handover.”

Roddy Davidson, an analyst at house broker Shore Capital, said: “STV has continued to deliver despite macro challenges and well-documented short-term headwinds across the production market - with several players reporting delays to content delivery schedules as disruption from last year’s industrial action in the US works through the system.

“The group’s ability to secure new commissions across multiple genres and a variety of broadcasters is also impressive. We are also bullish on the group’s potential in digital broadcasting as the STV Player continues to increase viewing and to achieve traction with advertisers.”

Last week, STV Group named Radcliffe as its new chief executive. Until April of this year, he was a member of ITV’s executive committee and latterly held the position of managing director of streaming, interactive and data, playing a key role in the acceleration of ITV’s digital transformation. Prior to joining ITV, he spent nine years at Channel 4.

STV has had something of a fractious relationship with ITV in the past. The group, which was once called Scottish Media Group, has never been subsumed into the vast ITV empire, despite previous talk of a potential takeover.

The change at the top for STV, which holds the Scottish Television and Grampian Television licences, follows the announcement in March of Pitts’ intention to step down from the board and his role as chief executive. He will do that on October 31 with Radcliffe formally taking up the post on November 1.

How major new orders from Netflix and Sky are boosting Scots broadcaster's top line