ITV warns of plunging advertising revenues but insists Clarkson row hasn’t damaged its brand

ITV has revealed falling annual profits and warned of tumbling advertising revenues – but its boss insists the storm over Jeremy Clarkson’s comments about Meghan Markle hasn’t harmed its brand.

The Love Island and I’m A Celebrity... Get Me Out of Here! broadcaster reported underlying pre-tax profits of £672m for 2022, down from £774m in 2021, as total advertising revenues fell 1 per cent and it spent heavily on content and its ITVX online hub.

It warned of a “challenging” ad spend outlook amid economic uncertainty, predicting ad sales will plunge by around 11 per cent year-on-year in the first quarter – falling by as much as 16 per cent in March – and to remain down by between 10 per cent and 15 per cent in April.

Chief executive Dame Carolyn McCall said: “The short-term outlook is challenging, with total advertising revenue expected to be down around 11 per cent in the first quarter, but we remain very focused on successfully executing the strategy and enter 2023 with strong momentum.”

She said advertisers are expecting the second half of 2023 to be “easier than the first half, but that remains to be seen”.

The results came as ITV and fellow broadcaster Sky have been asked by media watchdog Ofcom “to explain their actions” in their coverage of the Nicola Bulley case after her family questioned the role of the media during the investigation.

Dame Carolyn said ITV was a “responsible broadcaster and we take it very seriously”.

She also said it had handled criticism of Clarkson, who presents its quiz series Who Wants to be a Millionaire?, “quite well” after a widely condemned column about the Duchess of Sussex for The Sun. He wrote that he dreamed of the day the duchess was “made to parade naked through the streets of every town in Britain while the crowds chant ‘Shame!’ and throw lumps of excrement at her.” It became the Independent Press Standards Organisation’s most complained about article.

Dame Carolyn said: “We've been very clear ... Kevin [Lygo, managing director for media and entertainment at ITV] has been very overt about the comments being awful. I’ve said there’s no place for those comments on ITV and they weren’t on ITV, they were in The Sun. So, no, I don’t think there’s a wash over to the brand.”

She also refused to be drawn on whether Clarkson’s role as the quiz host would continue.

“As we said for several weeks, ITV is contractually committed to a further series of Who Wants to be a Millionaire?, which has now been recorded. There are no further commission commitments beyond that currently, as is typical with such shows where we make commissioning decisions on a series-by-series basis. Therefore, for the avoidance of doubt, neither Who Wants to be a Millionaire? nor Jeremy Clarkson have been cancelled. I think that is as clear as we can be.”

ITV said it will “continue to manage costs tightly” and is set to deliver £15m of savings as part of a previously-announced £50m target by 2026, which comes on top of the £106m of cuts between 2018 and 2022.

It said heavy investment in production and a digital push is paying off, with ITV Studios underlying earnings up 22 per cent at £259m on revenues up 19 per cent.

ITV confirmed that profits will be weighed on again over the year ahead as it spends another £55m on its new ITVX content site, although it hopes this will start to bolster the bottom line after 2023.