STV Group Full Year Results to 31 December 2024
Press Release 0700 hours, 11 March 2025
STV Group plc Full Year Results to 31 December 2024
Strong performance in challenging markets
Highlights
· Results demonstrate the benefits of diversification against a challenging market backdrop
o Group revenue growth of 12% to £188.0m, driven by acquisition-related growth in Studios and Euros-related advertising
o Studios revenue up 26% to £84.1m and adjusted operating profit up 18% to £6.1m
o 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
o Total Advertising Revenue (TAR) up 5% before commission; STV-controlled advertising up 5%
o Group adjusted operating profit up 3% to £20.6m; statutory operating profit more than doubles to £13.2m
o 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
|
Financial Summary |
2024 |
2023 |
Change |
|
|
Revenue |
£188.0m |
£168.4m |
+12% |
|
|
Adjusted operating profit* |
£20.6m |
£20.1m |
+3% |
|
|
Adjusted operating margin* |
11.0% |
11.9% |
-90bps |
|
|
Operating profit |
£13.2m |
£6.4m |
+106% |
|
|
Profit for the year |
£13.1m |
£5.3m |
+147% |
|
|
Adjusted basic EPS* |
29.0p |
28.2p |
+3% |
|
|
Statutory basic EPS |
23.5p |
9.7p |
+142% |
|
|
Cash generated by operations |
£17.7m |
£10.8m |
+64% |
|
|
Net debt+ |
£28.8m |
£29.0m |
-£0.2m |
|
|
Dividend per share (full year) |
11.3p |
11.3p |
flat |
|
|
* |
For reconciliation of adjusted to statutory measures see note 6 |
|||
|
+ |
Excluding lease liabilities and amounts drawn under non-recourse production financing facilities |
|||
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:
o 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)
o 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
o 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
o 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
o 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:
o Reach as percentage of total STV reach strong at 38% (FY26 target of 50%)
o Monthly active users 1m (FY26 target of 1.5m)
o 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:
o SME advertising +12%
o Scottish Government advertising -39%
o 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:
o £70m facility for 3+1+1 years, with £20m accordion
o Leverage ratchet removed with flat margin, at lower level, now payable
o 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:
o Total advertising revenue (TAR) expected to be slightly down
o National linear expected to be down c.5%
o Regional linear expected to be slightly up
o 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.
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
GROUP OVERVIEW
Total revenue grew by 12% to £188.0m (2023: £168.4m). This primarily related to growth in Studios revenue which reached £84.1m in the year, up from £66.8m in 2023, and benefitted from a number of drama productions across all scripted labels in the portfolio, including a strong first contribution from Two Cities Television (moved to majority stake in January 2024).
Total advertising revenue (TAR) for the year was £102.0m pre-commission (2023: £97.3m), an increase of 5% on the 2023 performance, with advertising revenues boosted by the Euros tournament in the summer but followed by a more difficult trading environment in H2 with the UK Government election and subsequent Autumn Budget causing uncertainty in the marketplace. Both national and regional advertising revenues were up 4% on the prior year.
Adjusted operating profit of £20.6m was up 3% on 2023, equivalent to an adjusted operating margin of 11.0% (2023: 11.9%). The reduction in margin was anticipated as we continued to grow our Studios business, with the impact of inflationary cost pressures also felt, in common with many UK corporates during the year. On a statutory basis, operating profit was £13.2m (2023: £6.4m).
At the start of the year, the Group announced a multi-year cost saving programme with an annual target run rate of £5m by the end of FY26, and a target of £1.5m set for 2024. Permanent savings of £1.9m were realised during the year with savings across broadcast operations, synergies associated with the Greenbird integration, and several support teams within the business and in our property portfolio. Costs associated with the savings programme that have been recognised as adjusting items during the year were £1.0m (2023: £nil).
Profit before tax was £10.4m (2023: £nil) after charging finance costs of £7.6m (2023: £6.2m). The components of finance costs were (i) interest on the Group's borrowings £3.4m (2023: £2.4m); (ii) non-cash interest on lease liabilities £0.5m in both years; (iii) net gain on foreign exchange contracts of £0.4m (2023: £nil); (iv) net interest on the net deficit in the Group's defined benefit pension schemes £2.4m (2023: £2.8m); and (v) unwinding of the discount on put option liabilities recognised in relation to business combinations £1.7m (2023: £0.5m). Items (iv) and (v) are recognised by the Group as adjusting items.
Other gains of £4.8m (2023: £nil) were recognised during the year (within adjusting items) in relation to accounting for acquisitions achieved in stages and revaluation to fair value of put option liabilities.
The Group recognised a tax credit of £2.7m in the year (2023: £5.3m), principally driven by high-end television tax credits receivable of £3.9m (2023: £7.7m) in relation to scripted programme production underway or delivered during the year. Resultant profit for the year was £13.1m (2023: £5.3m) with basic EPS of 23.5p (2023: 9.7p). On an adjusted basis, basic EPS was 29.0p (2023: 28.2p).
At year end, the Group had net debt under its revolving credit facility ('RCF') of £28.8m (2023: £29.0m). In addition, certain subsidiaries were party to separate production financing facilities, which are non-recourse to STV, in relation to specific programmes in production. Of the total production financing facilities available of £15.8m, amounts drawn at the end of the year were £9.9m. Amounts drawn under similar facilities at the end of 2023 of £3.3m were fully repaid during the year, on delivery of the finished programme.
Operating cash conversion was strong in the year at 134% (2023: 169%) given tight working capital management and Studios' ability to secure cash flow financing from commissioners.
The Group's RCF that was in place throughout the year was due to mature in early March 2026 and was refinanced over Q4 2024 with a new facility agreed and in place from mid-February 2025. The new facility is a £70m RCF with £20m accordion (uncommitted), for a term of at least 3 years (two 1-year extension options are available). The key financial covenants of leverage (the ratio of net debt to EBITDA) and interest cover, which must be less than 3 times and more than 4 times respectively, are the same as the previous facility. Interest will be payable under the new facility at a flat margin over SONIA, regardless of the leverage of the Group.
At the end of the year, the Group's leverage (excluding amounts drawn under non-recourse production facilities) was 1.1 times and interest cover was 8.5 times, both metrics well within the covenant limits.
The IAS 19 accounting deficit of the Group's defined benefit pension schemes fell during the year to £48.3m at 31 December 2024 (2023: £54.8m). The decrease in the liability is primarily driven by an increase in discount rate due to an increase in corporate bond yields and reflecting the updated triennial valuation results. In October 2024, the Group announced that it had agreed the December 2023 funding triennial valuation with the trustees, on a basis that saw the Group pay slightly lower total contributions going forward, a pause in the contingent cash payments until at least 2028, and the recovery plan period held at October 2030.
OPERATIONAL HIGHLIGHTS
STV STUDIOS
2024 was a good year for our Studios division against a very challenging market backdrop. We delivered creative and commercial momentum, with our family of production labels winning 51 new commissions or recommissions in the UK and internationally. The business has scaled rapidly and profitably over the last few years and is moving ever closer to its objective of becoming the UK's number 1 nations and regions producer - currently holding the number 2 spot on our estimates.
Our strategy of acquiring stakes in high potential production companies continues to deliver for the business. In H1, STV Studios increased its stakes in Northern Ireland based drama producers, Two Cities Television (moving to a majority of 51%), and unscripted specialists, Tuesday's Child and Crackit Productions (both already majority holdings). We also increased to majority stakes in Glasgow-based Hello Halo Productions, and Rumpus Media.
New commissions included our first series for Netflix, The Witness by STV Studios Drama. In Unscripted, Brighton-based Hello Mary won a two-part reality special for E4, My Big Fat Geordie Wedding which aired in the autumn, and Hello Halo was commissioned by Channel 4 to produce a brand new high stakes knitting competition, The Game of Wool. Crackit TV announced a three-part documentary series for Channel 5, Prime Suspect: Hunting the Predators as well as a 10 x 60-minute format for Channel 4, Crime Scene Cleaners.
Returning series commissions include a second series of crime thriller, Criminal Record for AppleTV+ and a third and fourth series of Blue Lights. Warner Bros Discovery UK & Ireland ordered a further 40 episodes of The Yorkshire Auction House franchise, ITV ordered a second series of The Fortune Hotel, and the BBC ordered a third series of The Travelling Auctioneers, a 29th series of Antiques Road Trip and a 13th series of Celebrity Antiques Road Trip.
We now have over 4,500 hours of programming in our distribution portfolio, delivering a valuable income stream for the business. Highlights for 2024 include LEGO Masters which continues to travel the world with exciting new spin off Out of The Box coming to the Netherlands, Finland and Poland; a Spanish version of The Hit List for TV Canaria; and a major deal with Sony's Game Show Network for a US version of Bridge of Lies, which saw us co-produce 100 episodes in Los Angeles.
At the end of February 2025, our forward order book was healthy at £76m, lower than earlier in the year as scripted programmes have been delivered. The rate of commission wins is slower in the current market than previously, but our labels continue to win and have momentum to carry forward.
DIGITAL
STV Player's strong content offering makes it a digital destination for viewers in Scotland and across the UK. A catalogue of high-quality network shows, original drama box sets, attractive acquisitions from across the world, and popular archive material, ensures we provide a rich and varied selection of on-demand shows. We have built strong connections with our audience through our content alongside a continuously improving user experience and wide availability across all major platforms.
STV Player continues its growth trajectory, with key events like the Euros delivering record streaming numbers to the platform, and new titles driving audiences. In 2024, we expanded distribution on four new live platforms further supporting the migration of viewers from linear to digital and ensuring mass availability of our service. We saw a significant boost in live viewing at c.20m hours, up 18% compared with 2023.
The UEFA Euro 2024 tournament delivered record breaking streaming numbers for the business, becoming STV Player's most-watched sporting event ever, up 61% compared with Euro 2020, and achieving 2.3m total viewing hours across the tournament. The semi-final between the Netherlands and England broke streaming records for a single match, generating 617k streams across the game. The Euros also delivered a new record month for live viewing in June 2024, at 2.8m hours.
Other key highlights from the network schedule delivering more than 1m hours of online viewing each include premium network dramas Mr Bates and the Post Office, After the Flood, Red Eye, and series two of Trigger Point; as well as the latest series of I'm A Celebrity… Get Me Out of Here!, which was streamed 4.8m times including 1.5m live streams, the latter up 40% year on year, suggesting this remains appointment to view television for many on both linear and digital.
Testament to the success of our digital acquisition strategy, third-party content comprised 36% of Video on Demand hours in 2024, with three of these titles featuring in the 2024 top ten most watched. These include soap Brookside (which has delivered over 8.8m hours of viewing since launch so far and helped us engage more viewers outside Scotland), Irish police procedural Red Rock, and US legal drama Betrayal, the latter part of a package of high-end scripted titles licensed from Disney.
We are now two years into our commercial partnership with ITV, who are our exclusive agent for all national VOD and simulcast advertising inventory on STV Player, allowing STV to benefit from ITV's scale in the UK market. 2024 was the first year in which commission became payable to ITV on our national VOD sales and so this had an impact on financial performance. Total sales (before commission) were £21.8m, up 8% on the prior year, with the revenues including commission of £19.5m, down 4% on the prior year. VOD revenue (before commission) grew by 9% year on year. This year 1 impact of commission lowered the profitability of the division, which generated adjusted operating profit of £8.4m 2024 (2023: £9.9m). With commission now reflected in the baseline, we expect the division to return to revenue and profit growth in FY25.
In Q1 2025, we announced an exciting new partnership with Premier Sports through which we offer viewers an exclusive and competitively priced package of Scottish, UK and international sports plus ad-free access to the full STV Player programme library, making this a highly competitive deal driving viewers directly to our platform.
BROADCAST
STV is the dominant commercial channel in Scotland, with 18 of the top 20 shows on commercial channels airing on STV. It also has a higher average audience across the day than Netflix, Prime, Disney+, Apple TV or YouTube in Scotland. This success is largely down to a strong connection with our viewers and our high-quality content offering across all genres.
STV viewers watch the channel for an average of 1 hour 42 minutes per day (1 hour 47 minutes in 2023), longer than any other Public Service Broadcaster in Scotland and higher than the UK average. 'Event' television - shows that bring the nation together - and valued public service broadcasting are key to this, and there are strong examples of this throughout 2024.
Across the year, 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.
The opening match of the UEFA Euros 2024 between Germany and Scotland gave the channel its best watched programme in 2024, peaking at 1.38m viewers. The overall reach of the tournament on STV was 3.1m, with a 48% viewing share across our matches, tracking 3 share points higher than the ITV network. The tournament also helped drive audience growth across harder-to-reach commercial audiences with ABC1 men and ABC1 U45's showing growth of +18% and +9% respectively (H1 2024 v H1 2023).
Top ten shows of the year included four-part series Mr Bates v the Post Office, which was STV's biggest new drama since 2021 and the most watched drama across all channels (including pre-TX viewing, linear launch and 28 day catch up) in Scotland in 2024. It had a considerable societal impact, further emphasising the importance and potential of well-funded public service media. Other top ten shows included the 13th series of crime drama Vera, flight thriller Red Eye, and true crime drama Until I Kill You. I'm A Celebrity… Get Me Out Of Here! won every 9pm time slot and ranked as STV's third most-watched programme of the year.
Our flagship programme, STV News at Six, is the most-watched news programme in Scotland for the 6th year running, with an average audience of 324k and a 30% share. Looking ahead to 2025, we will make significant investment in technology and in our Glasgow and Aberdeen live studios, relaunching the programmes with an exciting new look in the first half of the year. STV News is available on 13 online platforms including TikTok, Instagram, Facebook, WhatsApp, Apple News, YouTube and Google.
STV has unrivalled reach across commercial television in Scotland and delivers mass impact, reaching 70% of Scots per month. The STV Growth Fund makes advertising affordable and accessible for SMEs in Scotland and means that local brands are seen in ad breaks with the same prominence as national brands. Since launch in 2018, the STV Growth Fund has provided over £35m funding to Scottish SMEs, with 54% of growth fund members in 2024 being existing members from 2023. We also continue to support sustainable and diverse businesses in their TV marketing journey via our Green and Inclusion Funds.
The financial performance of the division in 2024 benefitted from the Euros-driven advertising growth year on year, with both national and regional linear advertising growing by 4%. Total Broadcast revenues were £84.4m for the year (2023: £81.4m) with the operating leverage of the division, combined with tight cost control that broadly offset inflationary cost increases, returning an operating profit of £10.9m (2023: £9.8m).
REGULATORY
In 2024, we were pleased to renew STV's Channel 3 licences for a further 10 years to 2034, securing the provision of Public Service Broadcasting (PSB) in the north and central regions of Scotland.
The UK Government Media Act was also enshrined in law, guaranteeing prominence for STV Player on all major digital platforms, ensuring our PSB content is easy for viewers to find. Going forward, it is important that Ofcom, which is now consulting on the implementation of the Act through 2025, has the power to ensure this requirement is duly enforced.
New statutory restrictions on advertising and sponsorship for 'Less Healthy' food and drink products that are high in fat, salt or sugar (HFSS) will apply to broadcast and on demand programme services from 1 October 2025. Alongside a number of other media companies, we have concerns that the legislation will have a negative impact on investment and growth for our sector and are engaging with the UK Government on this as a matter of urgency.
Consolidated income statement
Year ended 31 December 2024
|
|
|
2024 |
2023 |
||||
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
Adjusted results |
Adjusting items (note 6) |
Statutory results |
Adjusted results |
Adjusting items (note 6) |
Statutory results |
|
|
Note |
£m |
£m |
£m |
£m |
£m |
£m |
|
|
|
|
|
|
|
|
|
|
Revenue |
5 |
188.0 |
- |
188.0 |
168.4 |
- |
168.4 |
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
(171.3) |
(3.5) |
(174.8) |
(156.0) |
(6.0) |
(162.0) |
|
Operating profit |
|
16.7 |
(3.5) |
13.2 |
12.4 |
(6.0) |
6.4 |
|
|
|
|
|
|
|
|
|
|
Finance costs |
|
|
|
|
|
|
|
|
- borrowings |
|
(3.4) |
- |
(3.4) |
(2.4) |
- |
(2.4) |
|
- defined benefit pension schemes |
- |
(2.4) |
(2.4) |
- |
(2.8) |
(2.8) |
|
|
- lease interest |
|
(0.5) |
- |
(0.5) |
(0.5) |
- |
(0.5) |
|
- other finance income/(costs) |
0.4 |
(1.7) |
(1.3) |
- |
(0.5) |
(0.5) |
|
|
Total finance costs |
|
(3.5) |
(4.1) |
(7.6) |
(2.9) |
(3.3) |
(6.2) |
|
|
|
|
|
|
|
|
|
|
Other gains and losses |
13 |
- |
4.8 |
4.8 |
- |
- |
- |
|
Share of loss of associates |
|
- |
- |
- |
(0.2) |
- |
(0.2) |
|
Profit before tax |
13.2 |
(2.8) |
10.4 |
9.3 |
(9.3) |
- |
|
|
|
|
|
|
|
|
|
|
|
Tax credit |
7 |
2.4 |
0.3 |
2.7 |
4.5 |
0.8 |
5.3 |
|
Profit for the year |
15.6 |
(2.5) |
13.1 |
13.8 |
(8.5) |
5.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
Owners of the parent company |
13.3 |
(2.5) |
10.8 |
13.0 |
(8.5) |
4.5 |
|
|
Non-controlling interests |
|
2.3 |
- |
2.3 |
0.8 |
- |
0.8 |
|
|
15.6 |
(2.5) |
13.1 |
13.8 |
(8.5) |
5.3 |
|
|
|
|
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
|
|
|
Basic |
8 |
29.0p |
|
23.5p |
28.2p |
|
9.7p |
|
Diluted |
8 |
29.0p |
|
23.4p |
27.2p |
|
9.4p |
A reconciliation of the statutory results to the adjusted results is included at note 6. The above consolidated income statement should be read in conjunction with the accompanying notes.
Consolidated statement of comprehensive income
Year ended 31 December 2024
|
|
2024 |
2023 |
|
|
£m |
£m |
|
|
|
|
|
Profit for the year from continuing operations |
13.1 |
5.3 |
|
|
|
|
|
Items that will not be reclassified subsequently to profit or loss: |
|
|
|
Remeasurement of defined benefit pension schemes |
(0.3) |
2.0 |
|
Deferred tax credit/(charge) |
0.1 |
(0.5) |
|
Other comprehensive (expense)/income - net of tax |
(0.2) |
1.5 |
|
|
|
|
|
Total comprehensive income for the year |
12.9 |
6.8 |
|
|
|
|
|
Attributable to: |
|
|
|
Owners of the parent company |
10.6 |
6.0 |
|
Non-controlling interests |
2.3 |
0.8 |
|
|
12.9 |
6.8 |
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
Consolidated balance sheet
At 31 December 2024
|
|
|
2024 |
2023 |
|
|
Note |
£m |
£m |
|
Non-current assets |
|
|
|
|
Intangible assets |
10 |
36.5 |
25.0 |
|
Property, plant and equipment |
11 |
6.8 |
8.9 |
|
Right-of-use assets |
12 |
16.2 |
17.9 |
|
Investments |
14 |
2.3 |
4.1 |
|
Deferred tax asset |
15 |
19.5 |
19.8 |
|
Trade and other receivables |
|
0.5 |
1.0 |
|
|
|
81.8 |
76.7 |
|
Current assets |
|
|
|
|
Inventories |
|
28.8 |
24.4 |
|
Trade and other receivables |
|
48.0 |
38.9 |
|
Cash and cash equivalents |
|
11.1 |
13.9 |
|
|
|
87.9 |
77.2 |
|
|
|
|
|
|
Total assets |
|
169.7 |
153.9 |
|
|
|
|
|
|
Equity |
|
|
|
|
Ordinary shares |
17 |
23.3 |
23.3 |
|
Share premium |
|
115.1 |
115.1 |
|
Capital redemption reserve |
|
0.2 |
0.2 |
|
Merger reserve |
|
173.4 |
173.4 |
|
Other reserve |
|
2.1 |
2.4 |
|
Accumulated losses |
|
(316.0) |
(321.9) |
|
Shareholders' equity |
|
(1.9) |
(7.5) |
|
Non-controlling interests |
|
(11.0) |
(5.1) |
|
Total equity |
|
(12.9) |
(12.6) |
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
Borrowings |
16 |
39.6 |
41.6 |
|
Lease liabilities |
|
16.6 |
17.9 |
|
Retirement benefit obligations |
19 |
48.3 |
54.8 |
|
Deferred tax liabilities |
15 |
3.8 |
2.6 |
|
Trade and other payables |
|
15.2 |
5.9 |
|
|
|
123.5 |
122.8 |
|
Current liabilities |
|
|
|
|
Borrowings |
16 |
10.2 |
4.6 |
|
Trade and other payables |
|
48.1 |
37.9 |
|
Lease liabilities |
|
0.8 |
1.2 |
|
|
|
59.1 |
43.7 |
|
|
|
|
|
|
Total liabilities |
|
182.6 |
166.5 |
|
|
|
|
|
|
Total equity and liabilities |
|
169.7 |
153.9 |
The above consolidated balance sheet should be read in conjunction with the accompanying notes.
Consolidated statement of changes in equity
Year ended 31 December 2024
|
|
Share capital |
Share premium |
Capital redemption reserve |
Merger reserve |
Other reserve |
Accumulated losses |
Attributable to owners of the parent |
Non-controlling interest |
Total equity |
|
|
£m |
£m |
£m |
£m |
£m |
£m |
£m |
£m |
£m |
|
|
|
|
|
|
|
|
|
|
|
|
At 1 January 2024 |
23.3 |
115.1 |
0.2 |
173.4 |
2.4 |
(321.9) |
(7.5) |
(5.1) |
(12.6) |
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the year |
- |
- |
- |
- |
- |
10.8 |
10.8 |
2.3 |
13.1 |
|
Other comprehensive expense |
- |
- |
- |
- |
- |
(0.2) |
(0.2) |
- |
(0.2) |
|
Total comprehensive income for the year |
- |
- |
- |
- |
- |
10.6 |
10.6 |
2.3 |
12.9 |
|
|
|
|
|
|
|
|
|
|
|
|
Net share based compensation |
- |
- |
- |
- |
(0.3) |
0.4 |
0.1 |
- |
0.1 |
|
Dividends paid (note 9) |
- |
- |
- |
- |
- |
(5.1) |
(5.1) |
(0.6) |
(5.7) |
|
Changes in non-controlling interest (note 13) |
- |
- |
- |
- |
- |
- |
- |
(7.6) |
(7.6) |
|
At 31 December 2024 |
23.3 |
115.1 |
0.2 |
173.4 |
2.1 |
(316.0) |
(1.9) |
(11.0) |
(12.9) |
|
At 1 January 2023 |
23.3 |
115.1 |
0.2 |
173.4 |
1.8 |
(322.7) |
(8.9) |
(0.3) |
(9.2) |
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the year |
- |
- |
- |
- |
- |
4.5 |
4.5 |
0.8 |
5.3 |
|
Other comprehensive income |
- |
- |
- |
- |
- |
1.5 |
1.5 |
- |
1.5 |
|
Total comprehensive income for the year |
- |
- |
- |
- |
- |
6.0 |
6.0 |
0.8 |
6.8 |
|
|
|
|
|
|
|
|
|
|
|
|
Net share based compensation |
- |
- |
- |
- |
0.6 |
- |
0.6 |
- |
0.6 |
|
Dividends paid (note 9) |
- |
- |
- |
- |
- |
(5.2) |
(5.2) |
(0.2) |
(5.4) |
|
Changes in non-controlling interest (note 13) |
- |
- |
- |
- |
- |
- |
- |
(5.4) |
(5.4) |
|
At 31 December 2023 |
23.3 |
115.1 |
0.2 |
173.4 |
2.4 |
(321.9) |
(7.5) |
(5.1) |
(12.6) |
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Consolidated statement of cash flows
Year ended 31 December 2024
|
|
|
2024 |
2023 |
|
|
Note |
£m |
£m |
|
Operating activities |
|
|
|
|
Cash generated by operations |
18 |
17.7 |
10.8 |
|
Interest and fees paid in relation to banking facilities |
|
(3.3) |
(2.3) |
|
Corporation tax received |
|
4.2 |
5.0 |
|
Pension deficit funding - recovery plan payment |
|
(9.9) |
(9.7) |
|
|
|
|
|
|
Net cash generated by operating activities |
|
8.7 |
3.8 |
|
|
|
|
|
|
Investing activities |
|
|
|
|
Acquisition of subsidiary undertakings, net of cash acquired |
13 |
(1.1) |
(15.0) |
|
Purchase of additional shares in subsidiary undertakings |
13 |
(4.4) |
- |
|
Purchase of investment in associate |
|
- |
(0.3) |
|
Production finance repaid from associates |
|
- |
2.6 |
|
Purchase of intangible assets |
|
(0.7) |
(0.4) |
|
Purchase of property, plant and equipment |
|
(0.7) |
(0.8) |
|
|
|
|
|
|
Net cash used in investing activities |
|
(6.9) |
(13.9) |
|
|
|
|
|
|
Financing activities |
|
|
|
|
Payment of obligations under leases |
|
(1.8) |
(1.8) |
|
Borrowings drawn |
|
31.4 |
36.3 |
|
Borrowings repaid |
|
(23.9) |
(21.0) |
|
Dividends paid to non-controlling interests |
|
(0.6) |
(0.2) |
|
Dividends paid to equity holders |
|
(5.1) |
(5.2) |
|
|
|
|
|
|
Net cash generated by financing activities |
|
- |
8.1 |
|
|
|
|
|
|
Net increase/(decrease) in cash and cash equivalents |
|
1.8 |
(2.0) |
|
|
|
|
|
|
Net cash and cash equivalents, including overdraft balances, at beginning of year |
|
9.3 |
11.3 |
|
|
|
|
|
|
Net cash and cash equivalents, including overdraft balances, at end of year |
|
11.1 |
9.3 |
Notes to the preliminary announcement
Year ended 31 December 2024
1. General information
STV Group plc ("the Company") and its subsidiaries (together "the Group") is listed on the London Stock Exchange, limited by shares, and incorporated and domiciled in the UK. The address of the registered office is Pacific Quay, Glasgow, G51 1PQ. The principal activities of the Group are the production of content for UK and international commissioners, acquisition of content for viewers of its linear broadcast and Video on Demand player, and the sale of advertising airtime and space in these media.
2. Basis of preparation
The financial information set out in the audited preliminary announcement does not constitute the Group's statutory financial statements for the year ended 31 December 2024 within the meaning of Section 434 of the Companies Act 2006 and has been extracted from the full audited financial statements for the year ended 31 December 2024.
Statutory financial statements for the year ended 31 December 2023, which received an unqualified audit report, have been delivered to the Registrar of Companies. The reports of the auditors on the financial statements for the year ended 31 December 2023 and for the year ended 31 December 2024 were unqualified and did not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006. The financial statements for the year ended 31 December 2024 will be delivered to the Registrar of Companies and made available to all shareholders in due course.
Going concern
At 31 December 2024, the Group was in a total net debt position (excluding lease liabilities) of £38.7m comprising drawdowns under its banking facility of £40.0m, amounts drawn under separate, non-recourse third party production financing facilities of £9.9m, and a CBILS loan of £0.3m in a subsidiary undertaking, partially offset by net cash balances, including overdrafts, of £11.1m and unamortised financing fees of £0.4m.
At the balance sheet date, the Group had in place a £70m revolving credit facility (RCF), with £10m accordion, that was due to mature in March 2026. To ensure the Group had committed, available facilities extending at least 12 months from the date of signing its 2024 financial statements, it refinanced its banking facility in February 2025. The new arrangements provide the Group with a new £70m RCF with a £20m accordion (uncommitted) for a minimum 3-year term with two 1-year extension options.
The Group's covenant package includes the key financial covenants of net debt to EBITDA (leverage), which must be less than 3 times, and interest cover, which must be greater than 4 times. These are the same financial covenants as applied under the previous facility however the new arrangements have removed the leverage ratchet that determined the margin payable on amounts drawn, with a flat margin now charged on all borrowings regardless of Group leverage.
The Group is in a net current asset position and generates cash from operations that enables it to meet its liabilities as they fall due, and other obligations. At the year end, it had undrawn facilities under its RCF of £30m, cash balances of £11.1m, and a further £10m available through the accordion.
As part of the regular forecasting and budgeting processes, the Group considers the outlook for the UK advertising and global commissioning markets and uses them to inform the assumptions underpinning the business's own financial forecasts. As well as defining a 'base case' set of assumptions, the Group considers a range of alternative outcomes - on the upside and the downside - and assesses liquidity headroom and covenant compliance under all scenarios. The Group's forecasts and projections for both profitability and cash generation/debt levels, taking account of reasonably possible changes in trading performance, show that the Group will be able to operate within the level of its current available funding and financial covenants.
The Directors performed a full review of principal risks and uncertainties during the year. Longer term forecasts were prepared, with input from the Board, for the purpose of the refinancing in Q4 2024. Detailed forecasts have been prepared by the business for the period to 31 December 2027.
A severe but plausible downside scenario was identified against the base case assumptions for 2025 that reflected crystallisation of a number of risks, principally in relation to advertising revenues and the margin attached to programme commissions either confirmed for delivery in the year, or anticipated to be won and delivered in the year. Under this alternative scenario, the Group modelled a reduction of around 15% in the budgeted profitability of the Studios division combined with a continued softness in the UK advertising market.
Even under this scenario, the Group generated sufficient cash to enable it to continue in operation and remain within covenant levels under the new banking arrangements. Therefore, the Board concluded that the Group's forecasts and projections, taking account of reasonably possible changes in trading performance, show it will be able to operate within the level of its current available funding and covenant levels.
After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operation for at least 12 months from the date of this report. Accordingly, the Group continues to adopt the going concern basis in preparing its consolidated financial statements.
3. Accounting policies
The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 December 2024. There were no changes to accounting standards in the year that had any material impact on the financial statements.
4. Financial risk management and financial instruments
The Group's activities expose it to a variety of financial risks: currency risk, credit risk, liquidity risk and cash flow interest rate risk.
The carrying value of non-derivative financial assets and liabilities, comprising cash and cash equivalents, trade and other receivables, trade and other payables and borrowings is considered to materially equate to their fair value.
5. Business segments
Information reported to the Group's Chief Executive for the purposes of resource allocation and assessment of segment performance is by product. The Group's operating segments are Broadcast, Digital and Studios.
|
|
Broadcast |
Digital |
Studios |
Total |
||||
|
|
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
|
|
£m |
£m |
£m |
£m |
£m |
£m |
£m |
£m |
|
Sales |
92.7 |
90.4 |
19.5 |
20.2 |
84.4 |
67.2 |
196.6 |
177.8 |
|
Inter-segment sales |
(8.3) |
(9.0) |
- |
- |
(0.3) |
(0.4) |
(8.6) |
(9.4) |
|
Segment revenue |
84.4 |
81.4 |
19.5 |
20.2 |
84.1 |
66.8 |
188.0 |
168.4 |
|
Segment result |
|
|
|
|
|
|
|
|
|
Adjusted operating profit |
10.9 |
9.8 |
8.4 |
9.9 |
6.1 |
5.2 |
25.4 |
24.9 |
|
|
|
|
|
|
|
|
|
|
|
Unallocated corporate expenses |
|
|
|
|
(4.8) |
(4.8) |
||
|
Adjusted operating profit |
|
20.6 |
20.1 |
|||||
|
Adjusting items in operating profit (note 6) |
|
|
|
|
(3.5) |
(6.0) |
||
|
Other adjusting items (note 6) |
|
|
|
|
(4.1) |
(3.3) |
||
|
Production tax credits (note 6) |
|
|
|
|
|
|
(3.9) |
(7.7) |
|
Finance costs |
|
|
|
|
|
|
(3.5) |
(2.9) |
|
Other gains and losses(note 6) |
|
|
|
|
|
|
4.8 |
- |
|
Share of loss of associates |
|
|
|
- |
(0.2) |
|||
|
Profit before tax |
|
|
|
|
|
10.4 |
- |
|
|
Tax credit |
|
|
|
|
|
2.7 |
5.3 |
|
|
Profit for the year |
|
|
|
13.1 |
5.3 |
|||
Adjusted operating profit (as shown above) is the statutory operating profit before adjusting items and includes production tax credits receivable. Further information is provided in note 6. Unallocated corporate expenses relate to central expenses not attributable to divisions.
Total assets have increased from £153.9m to £169.7m at 31 December 2024. This movement primarily relates to the assets acquired from the acquisitions in the year (see note 13).
6. Adjusting items
In reporting financial information, the Group presents alternative performance measures (APMs) which are not defined or specified under the requirements of IFRS. The Group believes that these APMs, which are not considered to be a substitute for or superior to IFRS measures, provide stakeholders with additional helpful information on the performance of the business.
The table below sets out a reconciliation of the statutory results to the adjusted results:
|
|
2024 Operating profit £m |
2024 Profit before tax £m |
Basic EPS pence |
2023 Operating profit £m |
2023 Profit before tax £m |
Basic EPS pence |
|
Statutory results |
13.2 |
10.4 |
23.5p |
6.4 |
- |
9.7p |
|
Material contract implementation costs (i) |
- |
- |
|
3.1 |
3.1 |
|
|
Acquisition and integration costs (ii) |
0.8 |
0.8 |
|
2.4 |
2.4 |
|
|
Restructuring costs (iii) |
1.0 |
1.0 |
|
- |
- |
|
|
Amortisation of intangible asset (iv) |
1.7 |
1.7 |
|
0.5 |
0.5 |
|
|
|
16.7 |
13.9 |
|
12.4 |
6.0 |
|
|
IAS 19 finance costs (v) |
- |
2.4 |
|
- |
2.8 |
|
|
Other finance costs (vi) |
- |
1.7 |
|
- |
0.5 |
|
|
Other gains and losses (vii) |
- |
(4.8) |
|
- |
- |
|
|
Production tax credits (viii) |
3.9 |
3.9 |
|
7.7 |
7.7 |
|
|
Adjusted results |
20.6 |
17.1 |
29.0p |
20.1 |
17.0 |
28.2p |
|
|
|
|
|
|
|
|
(i) In 2022, the Group announced an extended partnership with ITV for digital content and advertising sales, effective from 1 January 2023. One-off costs of £3.1m associated with the negotiation and implementation of the agreement were charged in 2023.
(ii) On 6 July 2023, the Group acquired Greenbird Media Limited. Integration costs of £0.8m have been charged in the year (2023: £2.4m) relating to the final earn-out payable to founding members, professional fees and restructuring costs.
(iii) The Group announced a £5m cost saving programme in March 2024. Related one-off costs incurred were £1.0m (2023: £nil) attributable to professional fees, redundancy costs and loss on disposal of assets.
(iv) Following the acquisitions detailed in note 13, the Group has undertaken fair value assessments of the assets acquired and liabilities assumed. The fair value attributable to intellectual property has been amortised in the year, resulting in a total charge of £1.7m (2023: £0.5m). Amortisation of assets acquired through business combinations are included within adjusted results as they are acquisition related and, in line with our treatment of other acquisition related costs, we consider that they do not reflect the underlying trading performance of the Group.
(v) IAS 19 net finance costs are excluded from non-statutory measures as they are non-cash costs that relate to legacy defined benefit pension schemes.
(vi) The Group has liabilities relating to amounts payable to minority shareholders under put options at the date of acquisition of Greenbird Media Limited, Two Cities Television Limited and Hello Halo Productions Limited (see note 13 for details). A finance cost of £1.7m (2023: £0.5m) has been recognised in the period in relation to the unwinding of the discount on these liabilities.
(vii) Other gains and losses of £4.8m have arisen in relation to (i) acquisitions achieved in stages and (ii) acquired put option liabilities being revalued to fair value at the balance sheet date. A net gain of £2.9m has been recognised from bringing the consideration paid for the initial shareholdings in Two Cities Television Limited, Hello Halo Productions Limited and Rumpus Media Limited in line with fair value (see note 13 for further details). A net gain of £1.9m has been recognised on aligning put option liabilities acquired with fair value.
(viii) The Group meets the eligibility criteria to claim tax relief through the production of certain programmes created in its Studios division. This incentive was introduced in the UK to support the creative industries and is a critical factor when assessing the viability of investment decisions in the production of qualifying programmes. These production tax credits are reported within the total tax charge in the income statement in accordance with IAS 12. However, STV considers the production tax credits to be a contribution to production costs and therefore more aligned to working capital in nature. Therefore, the adjusted results for the Group reflect these credits as a contribution to operating costs and not a tax item. The tax credit regime is transitioning to an 'above the line' Audio-Visual Expenditure credits ("AVEC") arrangement which is accounted for in a similar way to the alternative performance measure presented above. Due to the timing of expenditure for the relevant productions and the transition period between the regimes, the tax credit of £3.9m recognised in the current period will be claimed under the previous regime, and therefore has been adjusted in the results.
7. Tax
|
|
|
|
2024 |
2023 |
|
|
|
|
|
£m |
£m |
|
|
|
|
|
|
|
|
|
The credit for taxation is as follows: |
|
|
|
|
|
|
Credit for the year before adjusting items |
|
|
2.4 |
4.5 |
|
|
Tax effect on adjusting items |
|
|
0.3 |
0.8 |
|
|
Credit for the year |
|
|
|
2.7 |
5.3 |
The Finance Act 2024, which received Royal Assent on 24 May 2024, had no impact on the corporation tax figures. The deferred tax balances at 31 December 2024 have been stated at a rate of 25% (2023: 25%), which is the rate at which the temporary differences are expected to unwind.
8. Earnings per share
The calculation of earnings per share is based on earnings after tax and the weighted average number of ordinary shares in issue during the year, excluding ordinary shares purchased by the Company and held for use by the STV Employee Benefit Trust.
For diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares. The Group has one type of dilutive potential ordinary shares namely share options granted to employees.
The adjusted earnings per share figures that have also been calculated are based on earnings before adjusting items that are significant in nature and/or quantum and not expected to recur every year and are therefore considered to be distortive. The adjusting items recognised in the current and prior year are detailed in note 6 and presented below net of the related tax effect. Adjusted earnings per share has been presented to provide shareholders with an additional measure of the Group's year on year performance.
|
Earnings per share |
2024 |
2023 |
|
|
Pence |
Pence |
|
|
|
|
|
Basic earnings per ordinary share |
23.5p |
9.7p |
|
Diluted earnings per ordinary share |
23.4p |
9.4p |
|
|
|
|
|
Adjusted basic earnings per share |
29.0p |
28.2p |
|
Adjusted diluted earnings per share |
29.0p |
27.2p |
The following reflects the earnings and share data used in the calculation of earnings per share:
|
Earnings |
£m |
£m |
|
|
|
|
|
Profit for the year attributable to equity shareholders |
10.8 |
4.5 |
|
Adjusting items in operating profit (net of tax) |
3.2 |
5.2 |
|
IAS 19 finance cost |
2.4 |
2.8 |
|
Other finance costs |
1.7 |
0.5 |
|
Other gains and losses |
(4.8) |
- |
|
Adjusted profit |
13.3 |
13.0 |
|
|
|
|
|
Number of shares |
Million |
Million |
|
|
|
|
|
Weighted average number of ordinary shares in issue |
45.9 |
45.8 |
|
Dilution due to share options |
0.1 |
1.6 |
|
Total weighted average number of ordinary shares in issue |
46.0 |
47.4 |
9. Dividends
|
|
2024 |
2023 |
2024 |
2023 |
|
|
per share |
per share |
£m |
£m |
|
Dividends on equity ordinary shares |
|
|
|
|
|
Paid final dividend |
7.4p |
7.4p |
3.3 |
3.4 |
|
Paid interim dividend |
3.9p |
3.9p |
1.8 |
1.8 |
|
Dividends paid |
11.3p |
11.3p |
5.1 |
5.2 |
A final dividend of 7.4p per share (2023: 7.4p per share) has been proposed by the Board of Directors and is subject to approval by shareholders at the 2025 AGM scheduled for 30 April 2025. The proposed dividend would be payable on 30 May 2025 to shareholders who are on the register at 22 April 2025. The ex-dividend date is 17 April 2025. This final dividend, amounting to £3.3m has not been recognised as a liability in these financial statements.
10. Intangible assets
|
|
Goodwill £m
|
Intellectual property £m |
Web development £m |
Total £m |
|
Cost |
|
|
|
|
|
At 1 January 2024 |
14.5 |
10.0 |
6.7 |
31.2 |
|
Additions |
- |
- |
0.7 |
0.7 |
|
Acquisitions (note 13) |
5.8 |
7.1 |
- |
12.9 |
|
Disposals |
- |
- |
(3.7) |
(3.7) |
|
At 31 December 2024 |
20.3 |
17.1 |
3.7 |
41.1 |
|
|
|
|
|
|
|
Accumulated amortisation and impairment |
|
|
|
|
|
At 1 January 2024 |
- |
0.5 |
5.7 |
6.2 |
|
Amortisation |
- |
1.7 |
0.4 |
2.1 |
|
Disposals |
- |
- |
(3.7) |
(3.7) |
|
At 31 December 2024 |
- |
2.2 |
2.4 |
4.6 |
|
|
|
|
|
|
|
Net book value at 31 December 2024 |
20.3 |
14.9 |
1.3 |
36.5 |
|
|
|
|
|
|
|
Net book value at 31 December 2023 |
14.5 |
9.5 |
1.0 |
25.0 |
11. Property, plant and equipment
|
|
Leasehold improvements £m |
Plant, technical equipment and other £m |
Assets under construction £m |
Total £m |
|
Cost |
|
|
|
|
|
At 1 January 2024 |
0.4 |
24.9 |
0.3 |
25.6 |
|
Additions |
- |
0.4 |
0.3 |
0.7 |
|
Transfers |
- |
0.3 |
(0.3) |
- |
|
Disposals |
(0.4) |
(2.0) |
- |
(2.4) |
|
At 31 December 2024 |
- |
23.6 |
0.3 |
23.9 |
|
|
|
|
|
|
|
Accumulated depreciation and impairment |
|
|
|
|
|
At 1 January 2024 |
0.2 |
16.5 |
- |
16.7 |
|
Charge for year |
- |
2.6 |
- |
2.6 |
|
Disposals |
(0.2) |
(2.0) |
- |
(2.2) |
|
At 31 December 2024 |
- |
17.1 |
- |
17.1 |
|
|
|
|
|
|
|
Net book value at 31 December 2024 |
- |
6.5 |
0.3 |
6.8 |
|
|
|
|
|
|
|
Net book value at 31 December 2023 |
0.2 |
8.4 |
0.3 |
8.9 |
12. Right of use assets
|
|
Property |
Vehicles |
Total |
|
|
|
£m |
£m |
£m |
|
|
Cost |
|
|
|
|
|
At 1 January 2024 |
25.6 |
0.3 |
25.9 |
|
|
Additions |
0.1 |
0.3 |
0.4 |
|
|
Disposals |
(1.7) |
(0.3) |
(2.0) |
|
|
At 31 December 2024 |
24.0 |
0.3 |
24.3 |
|
|
|
|
|
|
|
|
Accumulated depreciation |
|
|
|
|
|
At 1 January 2024 |
7.7 |
0.3 |
8.0 |
|
|
Disposals |
(1.0) |
(0.3) |
(1.3) |
|
|
Charge for the year |
1.4 |
- |
1.4 |
|
|
At 31 December 2024 |
8.1 |
- |
8.1 |
|
|
Net book value at 31 December 2024 |
15.9 |
0.3 |
16.2 |
|
|
Net book value at 31 December 2023 |
17.9 |
- |
17.9 |
|
13. Business combinations
Two Cities Television Limited
In January 2020, the Group acquired a minority stake of 25% in Two Cities Television Limited ("Two Cities"), with an option to increase its initial stake to a majority position upon Two Cities becoming profitable. On 30 January 2024, this option was exercised, and the Group increased its equity stake in Two Cities to 51%.
On the acquisition date, £0.4m of loan notes were converted, resulting in 10% equity being acquired via new shares issued. In line with the accounting requirements for a business combination achieved in stages, this overall initial stake of 35% has been remeasured at fair value at the acquisition date, resulting in a gain of £2.3m, which is presented within other gains and losses on the face of the consolidated income statement.
The consideration payable for the 16% equity that was then acquired through the option was £2.2m, of which £1.7m was paid on completion. Deferred consideration of £0.5m has been recognised which is payable in H1 2025.
The Group has completed its work in relation to assessing the fair values of identifiable assets acquired and liabilities assumed, therefore the amounts presented below are considered final.
|
Fair value of identifiable assets and liabilities of Two Cities Television Limited and subsidiary companies |
2024 £m |
|
Intangible assets |
6.5 |
|
Inventory |
9.4 |
|
Trade and other receivables |
2.4 |
|
Cash and cash equivalents |
1.3 |
|
Deferred tax liabilities |
(1.6) |
|
Trade and other payables |
(9.3) |
|
Contract liabilities |
(11.5) |
|
Fair value of net identifiable liabilities |
(2.8) |
|
Non-controlling interest measured at proportionate share of identifiable net assets |
(2.0) |
|
Adjustments to non-controlling interest regarding derivative put options |
7.1 |
|
Goodwill |
3.7 |
|
Consideration |
6.0 |
|
|
|
|
Total net cash outflow relating to acquisition of Two Cities Television Limited and subsidiary companies |
£m |
|
Consideration paid |
(1.7) |
|
Cash and cash equivalents acquired |
1.3 |
|
Total cash outflow |
(0.4) |
|
|
|
|
|
£m |
|
Present value of the expected liability on put options |
7.1 |
The goodwill of £3.7m represents the value placed on the ability of the acquired workforce in place to create and monetise future new productions, formats and intellectual property in scripted drama. It also represents the strategic benefits to be gained from the enlarged scale of the STV drama label portfolio. This has been calculated as the fair value of the consideration transferred, plus the amount of non-controlling interest adjusted for derivative put options relating to subsidiaries acquired, less the net of the fair value of the identifiable assets acquired and liabilities assumed.
From the date of acquisition, Two Cities Television Limited and subsidiary undertakings contributed £31.5m of revenue and £2.7m of adjusted operating profit to the Group's results.
Hello Halo Productions Limited
In July 2023, the Group acquired a minority stake of 30% in Hello Halo Productions Limited and its wholly owned subsidiary Hello Halo Kids Limited (together "Hello Halo"), as part of the acquisition of the Greenbird Media Limited group. On 30 August 2024, the Group increased its equity stake in Hello Halo to a majority holding of 51%.
In line with the accounting requirements for a business combination achieved in stages, the initial stake has been remeasured at fair value at the acquisition date, resulting in a gain of £0.8m, which is presented within other gains and losses on the face of the consolidated income statement.
The consideration payable for the 21% equity that was acquired in August was £0.8m, which was paid on completion.
The Group has completed the majority of its work in relation to assessing the fair values of identifiable assets acquired and liabilities assumed with only a small number of minor points to be finalised. Therefore, the fair values have been presented as provisional in the table below but it is not anticipated that there will be any material changes between the provisional and final position, which will be finalised within 12 months from the date of acquisition, as required by the relevant accounting standard.
|
Fair value of identifiable assets and liabilities of Hello Halo Productions Limited and subsidiary company |
2024 £m |
|
Intangible assets |
0.2 |
|
Inventory |
2.1 |
|
Trade and other receivables |
1.3 |
|
Contract assets |
0.1 |
|
Deferred tax liabilities |
(0.1) |
|
Trade and other payables |
(3.3) |
|
Contract liabilities |
(3.2) |
|
Fair value of net identifiable liabilities |
(2.9) |
|
Non-controlling interest measured at proportionate share of identifiable net liabilities |
- |
|
Adjustments to non-controlling interest regarding derivative put options |
2.8 |
|
Goodwill |
1.9 |
|
Consideration |
1.8 |
|
|
|
|
Total net cash outflow relating to acquisition of Hello Halo Productions Limited and subsidiary company |
£m |
|
Consideration paid |
(0.8) |
|
Cash and cash equivalents acquired |
- |
|
Total cash outflow |
(0.8) |
|
|
|
|
|
£m |
|
Present value of the expected liability on put options |
2.8 |
The goodwill of £1.9m represents the value placed on the opportunity to enhance the future growth prospects of the STV Studios unscripted division through increasing the volume of new productions, formats and intellectual property. This has been calculated as the fair value of the consideration transferred, plus the amount of non-controlling interest adjusted for derivative put options relating to subsidiaries acquired, less the net of the fair value of the identifiable assets acquired and liabilities assumed.
From the date of acquisition, Hello Halo contributed £3.6m of revenue and £1.0m of adjusted operating profit to the Group's results.
Rumpus Media Limited
In July 2023, the Group acquired a minority stake of 40% in Rumpus Media Limited ("Rumpus"), as part of the acquisition of the Greenbird Media Limited group. On 17 July 2024, the Group increased its equity stake in Rumpus to a majority holding of 99% following the trigger of a "bad leaver" provision in the share purchase agreement, which resulted in the additional 59% transferring to the Group for nominal consideration.
In line with the accounting requirements for a business combination achieved in stages, the initial stake of 40% has been remeasured at fair value at the acquisition date, resulting in a loss of £0.2m, which is presented within other gains and losses on the face of the consolidated income statement.
The Group has completed the majority of its work in relation to assessing the fair values of identifiable assets acquired and liabilities assumed with only a small number of minor points to be finalised. Therefore, the fair values have been presented as provisional in the table below but it is not anticipated that there will be any material changes between the provisional and final position, which will be finalised within 12 months from the date of acquisition, as required by the relevant accounting standard.
|
Fair value of identifiable assets and liabilities of Rumpus Media Limited |
2024 £m |
|
Intangible assets |
0.4 |
|
Inventory |
0.4 |
|
Trade and other receivables |
0.8 |
|
Contract assets |
0.3 |
|
Cash and cash equivalents |
0.7 |
|
Deferred tax liabilities |
(0.1) |
|
Trade and other payables |
(1.1) |
|
Contract liabilities |
(0.9) |
|
Borrowings |
(0.3) |
|
Fair value of net identifiable assets |
0.2 |
|
Goodwill |
0.2 |
|
Consideration |
0.4 |
|
|
|
|
Total net cash inflow relating to acquisition of Rumpus Media Limited |
£m |
|
Consideration paid |
- |
|
Cash and cash equivalents acquired |
0.7 |
|
Total cash inflow |
0.7 |
Goodwill of £0.2m has been calculated as the fair value of the consideration transferred less the net of the fair value of the identifiable assets acquired and liabilities assumed.
From the date of acquisition, Rumpus contributed £1.9m of revenue and £0.1m of adjusted operating profit to the Group's results.
Greenbird Media Limited
During the year, the Group finalised its fair value assessment of the identifiable assets acquired and liabilities assumed of Greenbird Media Limited and subsidiary companies, acquired on 6 July 2023. The table below sets out the adjustments that have been made to the provisional fair values previously disclosed within the annual financial statements for year ended 31 December 2023, to reach the final position.
|
Fair value of identifiable assets and liabilities of Greenbird Media Limited and subsidiary companies |
Provisional £m |
Adjustments |
Final £m |
|
Intangible assets |
10.0 |
- |
10.0 |
|
Property, plant and equipment |
0.2 |
- |
0.2 |
|
Right of use assets |
0.7 |
- |
0.7 |
|
Investments |
1.5 |
- |
1.5 |
|
Inventory |
1.8 |
- |
1.8 |
|
Trade and other receivables |
2.0 |
- |
2.0 |
|
Contract assets |
1.9 |
- |
1.9 |
|
Cash and cash equivalents |
6.9 |
- |
6.9 |
|
Deferred tax liabilities |
(2.6) |
- |
(2.6) |
|
Trade and other payables |
(15.4) |
0.3 |
(15.1) |
|
Lease liabilities |
(0.8) |
- |
(0.8) |
|
Contract liabilities |
(3.5) |
- |
(3.5) |
|
Fair value of net identifiable assets |
2.7 |
0.3 |
3.0 |
|
Non-controlling interest measured at proportionate share of identifiable net assets |
(4.2) |
- |
(4.2) |
|
Adjustments to non-controlling interest regarding derivative put options |
9.6 |
(0.3) |
9.3 |
|
Goodwill |
14.5 |
- |
14.5 |
|
Consideration |
22.6 |
- |
22.6 |
|
|
£m |
£m |
£m |
|
Present value of the expected liability on put options |
9.6 |
(0.3) |
9.3 |
Since the acquisition date, finance costs of £1.4m have been recognised in relation to unwinding the discount of the put option liability, with £0.9m recognised in the current year. During the year, the put options have been exercised, resulting in a cash outflow to the minority interests of £4.4m. The estimated liability for the remaining amounts payable of £5.5m is recognised in non-current trade and other payables at the balance sheet date.
|
Cash outflow relating to acquisition of Greenbird Media Limited and subsidiary companies |
2024£m |
||
|
Deferred consideration paid |
|
|
(0.6) |
Summary of acquisition related transactions for year ended 31 December 2024
|
|
Two Cities |
Hello Halo |
Rumpus |
Greenbird Media |
Total
|
|
|
£m |
£m |
£m |
£m |
£m |
|
Cash (outflow)/inflow
|
|
|
|
|
|
|
Consideration paid, net of cash acquired |
(0.4) |
(0.8) |
0.7 |
- |
(0.5) |
|
Deferred consideration paid |
- |
- |
- |
(0.6) |
(0.6) |
|
Acquisition of subsidiary undertakings, net of cash acquired |
(0.4) |
(0.8) |
0.7 |
(0.6) |
(1.1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of additional shares in subsidiary undertakings |
- |
- |
- |
(4.4) |
(4.4) |
|
|
|
|
|
|
|
|
Changes in non-controlling interest
|
|
|
|
|
|
|
Proportionate share of net (assets)/liabilities at acquisition date |
(2.0) |
- |
- |
- |
(2.0) |
|
Present value of expected liability on put options recognised on acquisition |
7.1 |
2.8 |
- |
- |
9.9 |
|
Adjustments recognised following finalisation of fair value of assets and liabilities acquired |
- |
- |
- |
(0.3) |
(0.3) |
|
|
5.1 |
2.8 |
- |
(0.3) |
7.6 |
|
|
|
|
|
|
|
|
Other gains and (losses)
|
|
|
|
|
|
|
Revaluation of initial investment held to fair value at acquisition date |
2.3 |
0.8 |
(0.2) |
- |
2.9 |
|
Revaluation of expected liability of put options to fair value as at 31 Dec 2024 |
1.0 |
- |
- |
0.9 |
1.9 |
|
|
3.3 |
0.8 |
(0.2) |
0.9 |
4.8 |
Summary of acquisition related transactions for year ended 31 December 2023
|
|
|
|
Greenbird Media |
|
|
|
|
£m |
|
Cash (outflow)/inflow |
|
|
|
|
Acquisition of subsidiary undertakings, net of cash acquired |
|
|
(15.0) |
|
|
|
|
|
|
Changes in non-controlling interest |
|
|
|
|
Proportionate share of net (assets)/liabilities at acquisition date |
|
|
(4.2) |
|
Present value of expected liability on put options recognised on acquisition |
|
|
9.6 |
|
|
|
|
5.4 |
14. Investments
|
|
2024 |
2023 |
|
|
£m |
£m |
|
|
|
|
|
Associates |
2.1 |
3.9 |
|
Other |
0.2 |
0.2 |
|
|
2.3 |
4.1 |
|
|
2024 |
2023 |
|
|
£m |
£m |
|
Associates |
|
|
|
At 1 January |
3.9 |
2.4 |
|
Additions |
- |
1.7 |
|
Share of loss |
- |
(0.2) |
|
Reallocations |
(1.8) |
- |
|
At 31 December |
2.1 |
3.9 |
At 1 January 2024, minority investments were held in Two Cities Television Limited, Hello Halo Productions Limited and Rumpus Media Limited, totalling £1.8m. The Group's shareholding was increased to a majority stake in each of these entities during the year (see note 13). The £1.8m investment value held in these associates has been reallocated to investments in subsidiaries and eliminated on consolidation.
The additions in associates during 2023 related to the acquisition of a further 15% stake in quiz show producer, Mighty Productions Limited, for a total consideration of £0.3m in July 2023 and the acquisition of investment in six associates for total consideration of £1.4m, as part of the acquisition of Greenbird Media Limited, ranging from an ownership stake of 25% to 40%. No dividends have been received from any associate undertaking.
The Group also holds shares in Mirriad Advertising plc which has a nominal fair value at the balance sheet date. This investment is measured at fair value through the Consolidated Statement of Comprehensive Income.
15. Deferred tax asset
At 31 December 2024, total deferred tax assets of £19.5m were recognised on the balance sheet (2023: £19.8m). Deferred tax liabilities of £3.8m (2023: £2.6m) were also recognised, relating to acquisitions from business combinations. This results in a net deferred tax asset of £15.7m (2023: £17.2m). Of this, £12.1m relates to the deficit on the Group's defined benefit pension schemes (2023: £13.7m) and the balance of £3.6m relates to tax losses, accelerated capital allowances and short-term timing differences (2023: £3.5m).
16. Borrowings
Non-current borrowings
At the balance sheet date, the Group had a £70m revolving credit facility (RCF) in place, with a £10m accordion, maturing in March 2026. Amounts drawn under the RCF were £40.0m (2023: £39.0m) net of unamortised costs of £0.4m (2023: £0.7m). The principle financial covenants are the ratio of net debt to EBITDA (which must be below 3 times) and interest cover (which must be higher than 4 times).
At 31 December 2023, the Group had a loan facility for production financing of £3.3m, which has been repaid in the year.
Current borrowings
The Group has two loan facilities relating to production financing of which £9.9m in total was drawn down at the balance sheet date (2023: £nil). The commissioned programmes to which the facilities relate are expected to deliver in 2025 with all amounts drawn down to be settled during the year.
The Group had bank overdrafts of £nil (2023: £4.6m) at the balance sheet date and there also exists borrowings under CBILS of £0.3m in one of the subsidiary companies (2023: £nil), which has been repaid in Q1 2025.
17. Share capital
|
|
Number of shares (thousands) |
Ordinary shares £m |
Share premium £m |
Total £m |
|
|
|
|
|
|
|
At 1 January 2024 and 31 December 2024 |
46,723 |
23.3 |
115.1 |
138.4 |
The total authorised number of ordinary shares is 63 million shares (2023: 63 million shares) with a par value of £0.50 per share (2023: £0.50 per share). All issued shares are fully paid.
18. Notes to the consolidated statement of cash flows
|
|
2024 |
2023 |
|
|
£m |
£m |
|
|
|
|
|
Operating profit |
13.2 |
6.4 |
|
Adjustments for: |
|
|
|
Depreciation and amortisation |
6.1 |
5.2 |
|
Share based payments |
0.1 |
0.6 |
|
Loss on disposal of assets |
0.2 |
- |
|
Decrease in inventories |
8.0 |
24.3 |
|
(Increase)/decrease in trade and other receivables |
(5.0) |
3.4 |
|
Decrease in trade and other payables |
(4.9) |
(29.1) |
|
Cash generated by operations |
17.7 |
10.8 |
Net debt reconciliation
|
|
RCF |
Production financing |
Net cash and cash equivalents, including overdrafts |
Net debt |
Lease liabilities |
Net debt including lease liabilities |
|
|
£m |
£m |
£m |
£m |
£m |
£m |
|
|
|
|
|
|
|
|
|
At 1 January 2024 |
(38.3) |
(3.3) |
9.3 |
(32.3) |
(19.1) |
(51.4) |
|
Cash flows |
(0.9) |
(6.6) |
1.8 |
(5.7) |
1.8 |
(3.9) |
|
Non-cash movements (i) |
(0.7) |
- |
- |
(0.7) |
(0.1) |
(0.8) |
|
At 31 December 2024 |
(39.9) |
(9.9) |
11.1 |
(38.7) |
(17.4) |
(56.1) |
(i) Non-cash movements relate to the amortisation of borrowing costs (for long-term borrowings), borrowings recognised on acquisition, the acquisition of right-of-use assets and lease interest.
Net debt excluding production financing was £28.8m (2023: £29.0m).
Operating cash conversion, calculated as cash generated by operations divided by operating profit and expressed as a percentage was 134% (2023: 169%).
19. Retirement benefit schemes
The Group operates two defined benefit pension schemes. The schemes are trustee administered and the schemes' assets are held independently from those of the Group. Pension costs are assessed in accordance with the advice of an independent professionally qualified actuary.
The schemes are the Scottish and Grampian Television Retirement Benefit Scheme and the Caledonian Publishing Pension Scheme. Both are closed schemes and accounted for under the projected unit credit method.
Contribution rates to the scheme are determined by a qualified independent actuary on the basis of a triennial valuation using the projected unit credit method. The most recent triennial valuation was carried out as at 31 December 2023. This valuation resulted in a deficit of £61m on a pre-tax basis compared to £116m on a pre-tax basis at the previous settlement date.
Deficit recovery plans, which end in 31 October 2030, have been agreed with aggregate monthly payments slightly lower than the previous recovery plans. The 2024 deficit recovery payments totalled £9.9m, with annual payments then increasing at the rate of 2% per annum over the term of the recovery plans. The contingent cash mechanism previously in place has been paused until at least 2028 with no further contingent payments required until then unless the Group and the trustees agree otherwise.
The recovery plans are designed to enable the schemes to reach a fully funded position, using prudent assumptions about the future, by 2030.
The fair value of the assets and the present value of the liabilities in the Group's defined benefit pension schemes at each balance sheet date was:
Assumptions used to estimate the scheme obligations
The significant actuarial assumptions used for accounting purposes reflect prevailing market conditions in the UK and are as follows:
|
|
|
|
|
|
2024 |
2023 |
|
|
% |
% |
|
|
|
|
|
Rate of increase in salaries |
nil |
nil |
|
Rate of increase of pensions in payment |
3.25 |
3.15 |
|
Discount rate |
5.45 |
4.50 |
|
Rate of price inflation (RPI) |
3.25 |
3.15 |
Assumptions regarding future mortality experience are set based on advice, published statistics and experience in each scheme and are reflected in the table below (average life expectations of a pensioner retiring at age 65).
|
|
|
|
|
|
2024 |
2023 |
|
Retiring at balance sheet date: |
|
|
|
Male |
20.7 |
20.5 |
|
Female |
22.9 |
22.7 |
|
Retiring in 25 years |
|
|
|
Male |
21.9 |
21.7 |
|
Female |
24.0 |
24.0 |
The fair value of the assets in the schemes and the present value of the liabilities in the schemes at each balance sheet date was:
|
|
At 31 December 2024 |
At 31 December 2023 |
|||||
|
|
Quoted |
Unquoted |
Total |
Quoted |
Unquoted |
Total |
|
|
|
£m |
£m |
£m |
£m |
£m |
£m |
|
|
|
|
|
|
|
|
|
|
|
Equity and equity options |
9.2 |
47.5 |
56.7 |
15.4 |
65.7 |
81.1 |
|
|
Alternative return seeking |
8.0 |
24.2 |
32.2 |
20.9 |
41.9 |
62.8 |
|
|
Cashflow matching credit |
1.7 |
61.9 |
63.6 |
1.8 |
53.1 |
54.9 |
|
|
Liability-Driven Investments and cash |
147.5 |
(39.1) |
108.4 |
119.6 |
(37.0) |
82.6 |
|
|
Currency hedge |
- |
(0.1) |
(0.1) |
- |
1.0 |
1.0 |
|
|
Annuity policies |
- |
10.0 |
10.0 |
- |
13.0 |
13.0 |
|
|
Fair value of schemes' assets |
166.4 |
104.4 |
270.8 |
157.7 |
137.7 |
295.4 |
|
|
|
|
|
|
|
|
|
|
|
Present value of defined benefit obligations |
|
|
(319.1) |
|
|
(350.2) |
|
|
|
|
|
|
|
|
|
|
|
Deficit in the schemes |
|
|
(48.3) |
|
|
(54.8) |
|
A related, offsetting deferred tax asset for the Group of £12.1m (2023: £13.7m) is included within non-current assets. Therefore, the pension scheme deficit net of deferred tax for the Group was £36.2m at 31 December 2024 (2023: £41.1m).
20. Post balance sheet events
In February 2025, the Group successfully refinanced its revolving credit facility (RCF) and put in place a new RCF for £70m, with £20m accordion, for a term of at least 3 years (two 1-year extension options are available). The key financial covenants remain the same as the previous RCF and are leverage (ratio of net debt to EBITDA), which must be less than 3x, and interest cover, which must be more than 4x. There is no margin ratchet associated with the new RCF and the Group will pay a flat rate of interest regardless of leverage for the duration of the facility.
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