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ITV makes profit after cost cuts ITV makes profit after cost cuts
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ITV has returned to an annual profit thanks to cost-cutting and increasing its share of a declining television advertising market.ITV has returned to an annual profit thanks to cost-cutting and increasing its share of a declining television advertising market.
The broadcaster made a pre-tax profit of £25m in 2009, compared with a loss of £2.7bn in 2008.The broadcaster made a pre-tax profit of £25m in 2009, compared with a loss of £2.7bn in 2008.
ITV said that while its advertising revenues for the year were down 9%, the wider market fell by 11%.ITV said that while its advertising revenues for the year were down 9%, the wider market fell by 11%.
It says the advertising market is now recovering, and it expects a 7% rise in advertising revenues for January-March.It says the advertising market is now recovering, and it expects a 7% rise in advertising revenues for January-March.
'Different business''Different business'
"Faced with the worst television advertising downturn on record, we took decisive action to improve our operational performance, deliver substantial cost savings and strengthen our balance sheet," said John Cresswell, ITV's interim chief executive."Faced with the worst television advertising downturn on record, we took decisive action to improve our operational performance, deliver substantial cost savings and strengthen our balance sheet," said John Cresswell, ITV's interim chief executive.
ITVLast updated: 03 Mar 2010, 09:23 UK *Chart shows local time pricechange%56.40p+1.30+2.36 More data on this share price ITVLast updated: 03 Mar 2010, 09:31 UK *Chart shows local time pricechange%56.20p+1.10+2.00 More data on this share price
ITV also announced that Adam Crozier will take up the chief executive role on 26 April. Mr Crozier is joining the broadcaster from the Royal Mail, which he returned to profitability.ITV also announced that Adam Crozier will take up the chief executive role on 26 April. Mr Crozier is joining the broadcaster from the Royal Mail, which he returned to profitability.
ITV chairman Archie Norman said that under Mr Crozier's leadership, ITV would "become a very different business over the next five years".ITV chairman Archie Norman said that under Mr Crozier's leadership, ITV would "become a very different business over the next five years".
"ITV's challenge is to reduce its dependence on a free-to-air model threatened by digital media and besieged by legacy regulation," said Mr Norman."ITV's challenge is to reduce its dependence on a free-to-air model threatened by digital media and besieged by legacy regulation," said Mr Norman.
'Work cut out''Work cut out'
The company's overall revenues for 2009 totalled £1.88bn, down 7% from £2.03bn in 2008.The company's overall revenues for 2009 totalled £1.88bn, down 7% from £2.03bn in 2008.
Meanwhile, it said it had achieved cost savings of £169m during the year, as it streamlined its operations, and also reduced its spending on programme making.Meanwhile, it said it had achieved cost savings of £169m during the year, as it streamlined its operations, and also reduced its spending on programme making.
At the same time, its share of peak time UK television viewing measured 28.2% for the year, up from 27.8% in 2008.At the same time, its share of peak time UK television viewing measured 28.2% for the year, up from 27.8% in 2008.
Former Channel 4 chairman Luke Johnson told the BBC Radio 4's Today programme that it was too early to say that ITV was now on the road to recovery.Former Channel 4 chairman Luke Johnson told the BBC Radio 4's Today programme that it was too early to say that ITV was now on the road to recovery.
"I think it is early days. We are currently in a honeymoon period prior to the general election for advertising spending," he said."I think it is early days. We are currently in a honeymoon period prior to the general election for advertising spending," he said.
"I'm not confident it will last into the second half of the year.""I'm not confident it will last into the second half of the year."
Mr Johnson added that he hoped Mr Crozier would be able to continue ITV's recovery, but cautioned that he would have his "work cut out".Mr Johnson added that he hoped Mr Crozier would be able to continue ITV's recovery, but cautioned that he would have his "work cut out".
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ITV last year asked the Competition Commission if it could have greater flexibility in charging more for advertisements.ITV last year asked the Competition Commission if it could have greater flexibility in charging more for advertisements.
However, the commission has so far rejected this call, saying the current limits should remain in place to prevent ITV from abusing its dominant market position.However, the commission has so far rejected this call, saying the current limits should remain in place to prevent ITV from abusing its dominant market position.
ITV argues that it no longer has such a dominant position because of the big growth in digital rivals, led by Sky.ITV argues that it no longer has such a dominant position because of the big growth in digital rivals, led by Sky.
Last month, Sky's owner BSkyB sold a 10% stake in ITV for £196m ($305m).Last month, Sky's owner BSkyB sold a 10% stake in ITV for £196m ($305m).
The Competition Commission had forced BSkyB to sell the stake after it ruled that it gave the company undue influence in the UK media.The Competition Commission had forced BSkyB to sell the stake after it ruled that it gave the company undue influence in the UK media.
BSkyB bought a 17.5% stake in ITV in 2006, but denied the purchase was aimed at blocking a proposed takeover of ITV by rival Virgin Media. BSkyB stills owns a 7.5% stake in ITV.BSkyB bought a 17.5% stake in ITV in 2006, but denied the purchase was aimed at blocking a proposed takeover of ITV by rival Virgin Media. BSkyB stills owns a 7.5% stake in ITV.