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Love Island and The Masked Singer boost ITV

Oscar Williams-Grut
Senior City Correspondent, Yahoo Finance UK
Davina McCall attending the Masked Singer press launch held at The Mayfair Hotel, London. (PA)

Hit shows such as Love Island and The Masked Singer helped ITV (ITV.L) to buck an advertising slowdown last year and post rising revenue.

ITV said on Thursday that revenue rose 3% to £3.3bn ($4.2bn) in 2019. That was better than the market had forecast.

Earnings for the year fell by 10% to £729m. ITV said the decline was down to investments made in digital.

The rise in revenues came despite an advertising slowdown. Ad sales shrunk by 1.5% in 2019 to £1.76bn. However, revenue at its ITV Studios business, which produces shows for ITV and other broadcasters, rose 9% to £1.8bn. Online advertising revenue also rose by 21%.

ITV warned advertising revenues are expected to slump by 10% next month as a result of coronavirus, which is putting off holiday companies from advertising.

The epidemic has led to slumping demand in the travel and tourism sector, and holiday companies facing a cash crunch are delaying advertising plans.

ITV chief executive Carolyn McCall said ITV was still on track to hit its “medium term” targets and overall advertising revenues should be up by 2% across the first three months of 2020.

McCall said it was “too difficult to assess” total impact of the coronavirus epidemic on its business.

Shares in ITV were down 5.1% in early trade in London.

McCall is pushing to transform the company from a single channel broadcaster into a content production and streaming business, closer to Netflix (NFLX).

She flagged strong online viewing for home-made hit Love Island and imported game show The Masked Singer, both of which helped online viewing figures rise 89% since the start of the year.

However, McCall said the cancellation of The Jeremy Kyle show last year had dented ITV’s reputation among the public and set back efforts to produce 10,000 hours of ITV Studios content by 2021.

The Jeremy Kyle show was cancelled in May 2019 after the death of a guest who had recently appeared on the show. The incident provoked a parliamentary inquiry into well-being safeguards.