The new UTV Ireland television station generated a loss of £7.5m (€10.2m) in the first half of this year; representing approximately 65% of the venture’s anticipated losses for the full year.
Parent company, the Belfast-based UTV Media, revealed, earlier this week, that it’s in talks regarding the sale of its television operations; a transaction which, were it to happen, would include the eight month old UTV Ireland arm.
In June, UTV widened loss estimates for its new Dublin-based channel for the third time in less than a year; saying it would post a maiden year loss of over €16m.
“The challenges of establishing a new television channel are evident in these results, which reflect the significant losses incurred by UTV Ireland in its first six months on air,” UTV Media chairman, Richard Huntingford said yesterday.
“Less evident, but not to be lost sight of, is the inherent value created by the establishment of a mainstream television channel in Europe’s fastest growing economy; with long-term licensing, programme supply and infrastructure in place,” he added.
The group didn’t update on the potential television sale, when issuing interim results yesterday, but stated that the existing plan for UTV Ireland includes “stronger domestic programming, more effective marketing and a better defined branding strategy.”
On a group-wide basis, UTV Media saw revenues marginally increase to £58.3m in the first half of 2015, but pre-tax profits fell by 90% to £1m.
Losses at UTV Ireland and the channel’s related £12.4m costs dragged the group’s overall television division into the red, showing a first half loss of £3.3m.
On an after-tax basis, UTV Media, posted a first half loss of £480,000; down from a first half post-tax profit of £7.9m.
UTV’s radio division, which includes a number of stations in Ireland and the UK, saw operating profits dip by almost £1m, to £7.9m and turnover fall by 11% to £34.6m.
The improving economy here, however, didn’t have a positive effect on advertising and UTV said its Irish radio operations saw ad revenues fall, year-on-year, by £1.5m to £8.8m.
Its Irish stations include Cork-based C103 and 96FM; Limerick’s Live95 and Dublin stations FM104 and Q102.
“With compensating currency tailwinds in our operating cost base, Irish radio operating profit, for the first half, was £400,000 lower at £2.1m,” the company added.
In a surprisingly upbeat, commentary, Gavin Kelleher of Goodbody Stockbrokers said: “UTV Ireland remains the key drag on profits, but we remain convinced that, over time, this station can reach the required audience and generate an attractive return.”
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