LONDON (Alliance News) - UTV Media PLC Tuesday expressed confidence that improving economic conditions in the UK and Ireland bodes well for the launch of its new television channel, as it saw profit growth in the half year to end-June.
It continued to make progress towards launching its new channel in Ireland at the start of 2015, as it agreed a licence with the Irish Broadcasting Authority, acquired and commissioned additional programming, and hired key executives.
Although the company is optimistic about the prospects of the channel, it cautioned that it would be challenged with building an audience and attracting advertisers in its first six months. As a result, it is forecasting a full year loss of GBP2.0 million to GBP3.0 million. However, UTV said it expects to move into profitability in the second half of 2015.
UTV proposed an interim dividend of 1.82 pence, up from 1.75 pence in the previous year.
Pretax profit rose to GBP10.0 million from GBP6.1 million, as revenue rose to GBP57.8 million from GBP51.2 million. The company said that it had seen strong recovery in each of advertising markets, with the 2014 FIFA World Cup boosting advertising spend and buoying its talkSPORT business in the first half.
In television, revenue in its Northern Ireland television business rose 8%. Television advertising revenue rose 9%, benefiting from 5% growth in Irish television advertising, reversing recent declines. In radio, revenue was up 20% due to the strong performance from talkSPORT.
Looking forward, UTV said it expects to see revenue up 3% in the third quarter.
The company said it expects to see 5% revenue growth in its UK radio division for the third quarter, with talkSPORT expected to be up 7%. Irish radio revenues are expected to see 6% revenue growth in the quarter at local currency, although this is expected to be offset by the strength of sterling.
Television revenues have softened in the third quarter, the company said, as some advertising campaigns were not applicable to Northern Ireland. Excluding acquisitions, revenues are forecast to be flat for the quarter, however, it expects television advertising to resume growth in the final months of 2014.
Shares in UTV were trading up 0.5% at 210.75 pence Tuesday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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