STV suffers 5% revenue dip but sees digital growth

STV suffered a 5% fall in its revenue in the first half of 2011 due to tough operating conditions, but the Scottish broadcaster's digital business grew by more than 50%.

The ITV licence holder in Scotland saw its revenue fall from £49.7m in the first half of 2010 to £47.2m in the six months to the end of June 30, 2011. However, pre-tax profit pre-exceptional items was actually up 8% year-on-year at £6.5m.

STV also reported that its digital business, including video on-demand service STV Player, showed strong growth in the first half of 2011, with revenues up 53% to £2.7m.

The company recently launched new digital consumer offerings STV Holidays and coupon service STV Daily Deals, joining the STV Local network of hyper-local news websites. STV's net debt was reduced by 5% in the first half to £57.5m.

STV chief executive Rob Woodward said: "We have transformed STV from a traditional broadcaster to a digital media company that engages with consumers across multiple platforms offering a compelling range of must-have digital services.

"We are excited by new technological developments that allow us to significantly extend our reach, and allow us to work with partners to deliver our unique, compelling content that can be accessed anywhere, anytime."

STV is also exploring more ways to collaborate with ITV beyond core TV services after the two companies ended their long-running legal disputes with an £18m settlement.

STV chairman Richard Findlay said: "Trading is in line with expectations and I am pleased to report that we continue to see encouraging growth in our digital business.

"The wide ranging settlement agreed with ITV removes significant uncertainty and we look forward to a new and constructive relationship. The various legacy issues have now been closed out, resulting in a cash positive operating structure going forward.

"While we remain cautious about the near-term TV advertising market, we have complete confidence that our strategy will continue to deliver growth with a resumption of dividends at the end of the year barring unforeseen circumstances."