By Paul Sandle
LONDON (Reuters) - Britain's ITV (LON:ITV), the maker of "Mr Bates vs the Post Office", said it expected a recovery in the advertising market to help boost its profits this year after on Thursday reporting a slump in full-year operating profit.
The broadcaster said it was "well placed to grow profits from here" as it forecast growth in its Studios production business, lower spending on its ITVX streaming platform from a peak in 2023, and cash generation from advertising.
It reported a 32% drop in full-year adjusted operating profit to 489 million pounds ($623 million) for 2023, just beating market expectations.
Shares in ITV, which have fallen 30% in the last 12 months, rose 8% in morning deals.
The performance from Studios, where revenue was up 4%, and 19% growth in digital revenue helped to limit the drop in total revenue to 2%, despite a 15% decline in linear advertising.
Chief Executive Carolyn McCall said: "We definitely see more confidence in the advertising market."
"Last year was a tough advertising market, that's undeniable," she told reporters. "We've compensated for a lot of that through Studios and digital growth. But at the same time we expect this year to be better than last year."
McCall said "Mr Bates vs the Post Office", ITV's biggest drama success in over a decade, was a "brilliant example" of how television could engage viewers and spur them to action.
The dramatisation of one of Britain's biggest miscarriages of justice has led to proposed changes in the law.
It also demonstrated the success of ITVX, she said, with the show attracting 4 million viewers on ITV 1 in January, and another 10 million watching each episode since on ITVX.
ITV said its total advertising revenue in the first quarter of 2024 was expected to be up 3%, ahead of analyst expectations.
McCall said the prospects for the coming months also looked "very positive" with the Euros soccer competition in June and July.
($1 = 0.7851 pounds)