ITV gets off to good start thanks to online and studio content

ITV reported strong first-quarter growth in advertising revenues as new chief executive Carolyn McCall said her "strategic refresh is progressing well" ahead of a summer where profits will hang to a large extent on the FIFA World Cup.

The FTSE 100 broadcaster generated total revenue of £772m in the first three months of the year, up 5% on what it did last year, with sales from ITV Studios content-production arm up 11% at £382m, while Broadcast & Online was up 3% to £526m.

Strong 41% growth in online help the Online, Pay & Interactive segment increase revenue 25%.

Total net advertising revenue, inlcuding online and sponsorship, was up 3% in the first quarter but McCall said she expected it to even out at 2% over the first half due to strong online growth but broadly flat broadcast NAR for the ITV 'family' of channels.

"While the economic environment remains uncertain online advertising continues to grow strongly," she said. "We expect ITV total advertising to be up 2% over the first half, but profits will reflect the timing of the Football World Cup. Over the full year we are on track to deliver double digit growth in online revenue and good organic revenue growth in ITV Studios."

The first quarter saw the ITV Family share of viewing up 6% and online viewing up 31%, while the total ITV share of viewing in the four months to end-April was up 7% and the Family up 6%. As well as Russia kicking off, coming months will be boosted by the return of the insanely popular trash-TV show Love Island and a new period drama in Vanity Fair from the producers behind Victoria and Poldark.

ITV Studios, which delivered organic revenue growth of 9%, has a slate of new and returning programmes for ITV's benefit and overseas sales, including Unforgotten, The War of the Worlds, Snowpiercer, Good Witch, Suburra, The Voice, The Chase, Big Star's Little Star, Queer Eye for the Straight Guy, The Four and Forged in Fire.

Shares in ITV rose 4% to 157.7p on Thursday morning.

Analysts at Shore Capital said they were "encouraged" by the solid start to the year "particularly in view of the significant advertising spend headwinds that have buffeted the company for some time" and expect an improved backdrop for the higher margin NAR component of its revenue base during the current year, helped by the World Cup.

ITV is also seen as a strategic asset within a consolidating industry as media, tech and telecom companies will continue to compete for proprietary content as seen in the ongoing battle for Sky and the fact that Liberty Global, ITV's largest shareholder with a 10% stake, could soon have a bundle of cash from its sale of assets to Vodafone.