STV to return £10m to investors despite profits plunge

Broadcaster STV today revealed a 26 per cent drop in first-half profits but said its confidence in the 'underlying strength of the business' would see it return £10 million to shareholders over the next 18 months.

Outgoing STV chief Rob Woodward. Picture: John Devlin
Outgoing STV chief Rob Woodward. Picture: John Devlin

The Glasgow-based group, which earlier this month named ITV executive Simon Pitts as its new boss, also said that investors would receive a 25 per cent hike in their interim dividend to 5p a share, to be paid on 27 October, while the full-year payout is set to rise by 13 per cent to 17p.

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This comes despite pre-tax profits at STV sliding to £7.5m for the six months to the end of June, down from £10.2m a year earlier, on revenues 3 per cent lower at £54.6m, amid a “weak” advertising market.

Revenues at the group’s production arm, which makes shows such as Celebrity Antiques Road Trip for BBC 2, dropped 26 per cent to £2.6m, but chief executive Rob Woodward said the division had built up a “strong pipeline” for the second half. The business recently secured its first BBC drama series commission, a four-part thriller set in Edinburgh called The Victim.

Woodward, who will be replaced by Pitts on 3 January, said: “Significant markers of progress have been delivered during the first half of 2017 including the launch of STV2, a new channel for Scotland, which will enable the company to continue to grow its share of the Scottish market.

“Digital activities continue to deliver double-digit growth while maintaining high margins after taking account of additional investment to support future development.”

He added: “The performance of the business in the first half of 2017 is in line with expectations despite the weak advertising market.”