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New Glasgow channel boosts STV as surge in profits unveiled

STV has reiterated its commitment to local television as it posted a 35 per cent uplift in profits on the back of strong advertising revenues from the football World Cup.

Delighted: Rob Woodward, chief executive of STV, which is thriving.
Delighted: Rob Woodward, chief executive of STV, which is thriving.

Chief executive Rob Woodward says he has been delighted with the monthly viewing figures of around 650,000 people for the STV Glasgow service following its launch in June.

Around 60 per cent of advertisers who had booked time on STV Glasgow were said to be new to the company with the channel generally reaching a younger audience than the core STV one.

In spite of local television services in other parts of the UK, particularly London and Birmingham, appearing to be struggling Mr Woodward confirmed STV will launch its Edinburgh station on January 5.

While the original launch date has twice slipped, from August this year and then to December, Mr Woodward said that was for operational reasons rather than any wavering of its intentions.

He said: "We are very different to any other [local television] franchisees. We are the only broadcaster which puts us in a very different position as we have a lot of existing resources which we are using to support STV Glasgow [and] on top of that we have our existing audience.

"Initially we didn't want to launch two new channels at the same time. It seemed more sensible to get STV Glasgow up and running, ensure it was successful and use all the learning from the running of that to put into Edinburgh.

"We looked at a December launch but simply the worst possible time to launch a channel is in the run up to Christmas and New Year. So it is going to come live on the fifth of January."

STV confirmed it planned to double its interim dividend to 2p and intends to pay an additional 4p for the full-year. It also signalled a 33 per cent rise in the dividend for 2015.

In the first six months of the year revenue increased seven per cent from £51.7 million to £54.7m with pre-tax profits increasing from £6.2m to £8.4m. The net debt was cut by eight per cent from £43.4m to £40.1m with it expected to fall further by the end of 2014. Digital revenue was said to have grown by 16 per cent.

While STV Productions' revenue fell in the period, from £4.6m to £3.9m, much of its programme sales are weighted to the second half of the year.

Mr Woodward expects the production arm to hit a target of £16.8m by the end of the year.

A new 40 episode commission of quiz show The Link, which will be produced in Glasgow for the BBC, was announced yesterday alongside a one-off documentary, Tutankhamun - The Boy Behind The Golden Mask, which will be shown in the autumn and is being backed by the BBC, the Smithsonian channel in the United States and Discovery Canada.

Mr Woodward said the intention was to grow STV organically rather than through acquisition but the improving nature of the company's balance sheet gave rise to more possibilities.

National airtime revenue is expected to be running seven per cent ahead by the end of the third quarter of the year.

STV said there was more volatility in the Scottish market but it is likely to be tracking six per cent up to the end of October while digital revenues are forecast to grow between 15 per cent and 20 per cent across 2014.

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