CONFLICTING results have come from two television broadcasting
companies, Central and HTV, with the former reporting a surge in profits
while the latter saw further losses and will pay no interim dividend.
Along with Scottish TV, Central came out very well from the auction of
independent TV broadcasting franchises, bidding just #2000. Profit has
soared from #3.4m to #15.1m in the first half year from a combination of
cost savings and a bigger share of advertising market.
All TV companies have been cutting costs, primarily through slimming
staff numbers, in the face of a difficult advertising market and the
threat of increasing competition from satellite and cable.
Central's workforce has more than halved to 944.
The group has a 20% stake in Meridian which has the franchise for the
south of England. This gives scope for savings in certain common
facilities, though they are in competition when it comes to sharing the
advertising cake.
Central chairman and chief executive Leslie Hill says the outlook for
advertising revenue remains uncertain though he predicts a successful
year overall.
The interim dividend is lifted from 7.5p to 10p and the shares jumped
69p to 1444p.
HTV, in contrast, plunged 14p to 27p on its #5m loss, slightly more
than in the same period last year, and on a gloomy statement from
chairman Louis Sherwood. The group had earlier this year been more
optimistic but this was on the assumption that the recession would lift
after the election. Now he views it as prudent to plan on the recession
lasting indefinitely.
Furthermore, HTV has commissioned a survey of likely future
advertising revenue for the industry as a whole which found that a big
drop in income was likely for next year and beyond. So the group is
aiming to reduce further its spending and to cut its overdraft.
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