Digital debacle cost Carlton €156m
ITV broadcaster Carlton’s failed foray into digital television left it with a bill of €156m it emerged today, as the company sought to draw a line under a ‘‘very difficult period’’.
The charge from the closure of ITV Digital and ITV Sport Channel was blamed along with the severe downturn in the advertising market for pre-tax losses of €283m in the six months to March 31.
Advertising revenues tumbled 13% on a like-for-like basis in the half-year as the economic slowdown meant a host of major brand owners cut back on marketing campaigns.
Turnover from Carlton’s continuing operations fell 7% in the period to €794.7m.
The pre-tax losses of €283.4m compare with losses of €438m for the same period last year.
Carlton, whose ITV franchises include Central TV, Carlton and HTV, said last year’s corresponding figure had been restated to reflect the recent closure of ITV Digital, which it co-owned with Granada.
It added that the six months had been a ‘‘very difficult period for Carlton’’ but that it was in a strong financial position with net debt of €60m. There were also signs the advertising market was on the mend.
‘‘The market appears to be firming through the summer months, even taking into account the expected fillip of the World Cup finals in June,’’ the group said.
‘‘Advertisers in most major categories are showing interest in renewed activity.’’
Carlton added that the closure of ITV Digital had increased its ‘‘financial flexibility’’ and it was now focused on growing its content and advertising sales businesses both in the UK and internationally.
It would, however, ‘‘robustly defend’’ the Football League’s claim for the €282m which remains outstanding to Nationwide League football clubs from their deal with ITV Digital.
‘‘Having taken advice from leading counsel, Carlton and Granada believe the counter-claim has no legal basis whatsoever. Accordingly, it will be robustly defended and no provision has been made for it,’’ Carlton said.
