Strong performance in challenging markets

Highlights

• Results demonstrate the benefits of diversification against a challenging market backdrop
  • Group revenue growth of 12% to £188.0m, driven by acquisition-related growth in Studios and Euros-related advertising
  • Studios revenue up 26% to £84.1m and adjusted operating profit up 18% to £6.1m
  • Digital sales (before commission) up 8% to £21.8m (net of commission -4%); year 1 of commission drives lower adjusted operating profit of £8.4m as expected
  • Total Advertising Revenue (TAR) up 5% before commission; STV-controlled advertising up 5%
  • Group adjusted operating profit up 3% to £20.6m; statutory operating profit more than doubles to £13.2m
  • Group adjusted operating margin of 11.0% slightly down, as expected and reflecting strong growth in Studios
• Cost savings achieved of £1.9m vs target of £1.5m; on track to deliver £5m p.a. by end FY26
• Operating cash conversion strong at 134% (2023: 169%)
• Net debt (excluding non-recourse production financing) at £28.8m (2023: £29.0m)
• In Feb-25, new revolving credit facility of £70m secured at favourable rates, for at least 3 years

• Board proposes final dividend of 7.4p (full year 11.3p), in line with 2023
• New CEO Rufus Radcliffe to outline strategy refresh in May 2025

Rufus Radcliffe, Chief Executive, said:

“I’ve been with STV for 4 months and it’s clear that the foundations of the business are strong.  STV is a much more balanced Group following the scaling of our Studios and Digital businesses, with good growth potential.

2024 was a good year for STV. We delivered a strong performance against a challenging economic backdrop, with results in line with expectations.  We are controlling those elements we can, in line with our strategy, and are very much on track to ensure that STV is in the best possible shape when the market recovers.

We’re seeing continued growth in our Studios business, with 51 commissions won in 2024 for more customers than ever before.  Across our 21 labels we have secured future revenue of £76m, with strong development pipelines across all genres. 

STV continues to be Scotland’s pre-eminent marketing platform, reaching 3.3m people per month. The Euros provided a welcome boost to viewing and advertising in H1 2024, winning us a 48% audience share across the tournament, and delivering record audiences for live viewing on STV Player.

I’m working closely with the leadership team on a strategy refresh taking us to 2030.  This will build on the strengths of our existing strategy and take it to the next stage of development and growth.  I look forward to updating on this in May 2025.” 

Strategic progress:

Content

• STV Studios continues to build momentum in a difficult market, with strong performances from recent acquisitions:
  • Two Cities’ first contribution to Group results is revenue of £31.5m and adjusted operating profit of £2.7m driven by Amadeus (Sky) and Blue Lights (BBC)
  • Hello Halo and Rumpus, which the Group moved to majority stakes in during H2, contributed a combined £5.5m in revenue and £1.1m in adjusted operating profit
• Studios adjusted operating margin was 7.2% (2023: 7.7%), the slight reduction a product of genre mix in programmes delivered and margin pressure from commissioners
  • Building blocks of future margin growth remain: 37 returning series produced in year and strong secondary sales revenue £7.7m (2023: £7.0m)
• Division currently in production on four drama series, all delivering in 2025
• 51 new commissions and recommissions in 2024
• Orderbook healthy at end-February 2025 at £76m, down relative to end-October 2024 (of £92m) following revenue recognition of £21m and commissions won of £5m
  • Includes high value recommissions of Criminal Record S2 (AppleTV+), Blue Lights S3&4 (BBC) and The Fortune Hotel S2 (ITV)

Audience

• STV & STV Player combined still the clear number 1 for commercial audiences in Scotland
  • 19% share of total peak commercial audience in 2024 (vs Netflix 13%, Sky 10% and C4 6%)
• STV was the most watched commercial channel in Scotland on 363 of 366 days in 2024
• In 2024, STV aired the best-watched quiz show (The 1% Club), drama (Mr Bates vs The Post Office), and soap (Coronation Street) across all channels in Scotland
• STV Player continues to deliver:
  • Reach as percentage of total STV reach strong at 38% (FY26 target of 50%)
  • Monthly active users 1m (FY26 target of 1.5m)
  • Online streams down 1%; consumption on owned and operated platforms up 8%
• Acquired titles for the Player represented 36% of consumption, with key titles including Brookside (3.7m hours in 2024; 8.5m hours since launch in Feb-23) and Red Rock (2.8m hours since launch to end 2024)
• Media Bill now enshrined in law; Ofcom tasked with ensuring prominence is given to Public Service Media (PSM) VoD services across platforms to protect discoverability for viewers

Monetisation

• STV-controlled advertising revenues +5%, comprising:
  • SME advertising +12%
  • Scottish Government advertising -39%
  • Scottish VOD revenue +6%, with c.60% of brands combining linear and VOD
• 97% of top 500 commercial audiences were on STV in 2024
• New advertisers on STV in 2024 totalled 124, with a re-booking rate of c.55%
• Registrations to subscription service, STV Player+, up 36% to 22,000
• New multi-year partnership with Premier Sports announced in February 2025, providing unique deal in market and increasing attractiveness of STV Player to younger, male skewing audiences

Organisation

• Strong progress made towards £5m p.a. cost saving target by end of FY26 with £1.9m realised in 2024
• Targeting at least £1.7m incremental savings in 2025
• Defined benefit pension scheme triennial valuation agreed in October 2024, with committed cash contributions slightly lower going forward, and contingent cash mechanism paused until at least 2028
• Group’s main banking facility refinanced in February 2025 on favourable terms:
  • £70m facility for 3+1+1 years, with £20m accordion
  • Leverage ratchet removed with flat margin, at lower level, now payable
  • Key financial covenants remain in place – leverage <3x and interest cover >4x

Outlook

• STV is a more diversified business with growing momentum in content creation and a strong audience proposition highly valued by advertisers
• Our focus continues to be growth in Studios, monetisation of our audience and a drive in cost savings and operational efficiency
• In the short term, the macroeconomic backdrop will continue to impact commissioner and advertiser budgets, but STV is well placed for when conditions improve
• Advertising: Late Easter has phasing effect on yoy comps for Q1 – outlook for Jan-Apr is:
  • Total advertising revenue (TAR) expected to be slightly down
  • National linear expected to be down c.5%
  • Regional linear expected to be slightly up
  • Total VOD continuing to show growth up c.6%
• Studios: forward orderbook at end Feb-25 of £76m, majority confirmed for 2025 delivery
• Cost saving programme on track with additional £1.7m targeted in FY25; incremental employers’ NI costs material to the Group at £0.5m in FY25

Dividend

• The Board proposes a final dividend 7.4 pence per share, after considering all relevant factors including the ongoing macroeconomic uncertainty
• The Board remains committed to a balanced approach to capital allocation across investing for growth, fulfilling our pension obligations, and paying a sustainable dividend to shareholders.

Full release: https://www.londonstockexchange.com/news-article/STVG/stv-group-full-year-results-to-31-december-2024/16934104?showDisclaimer=true

There will be a presentation for analysts on STV’s Full Year Results for 2024 today, Tuesday 11 March, at 12.30pm via Spark Live. Should you wish to attend this presentation, please email Angela Wilson at angela.wilson@stv.tv.

Enquiries:

STV Group plc:

Kirstin Stevenson, Head of Communications                  Tel: 07803 970 106

Camarco:

Geoffrey Pelham-Lane, Director                                         Tel: 07733 124 226

Ben Woodford, Director                                                       Tel: 07790 653 341