STV Group plc

You all can hear well. You are very welcome. Thank you very much for joining us today. So in a moment, Lindsay and I will talk you through our results for the first half of 2024. We'll provide an update on our financial and strategic progress, as well as a sense of the outlook for the year. And as usual, we'll show you some on-screen highlights of shows that have been entertaining audiences on STV, as well as those we've been producing for other broadcasters and streamers in the UK and beyond. over the last six months. But first of all, let me hand over to STV's chair, Paul Reynolds, for some words of introduction.

Paul. Thanks, Simon. Hello, everybody. So in today's results, I want to talk about STV's strong performance for the first half of 2024, and about the leadership changes for the group. As you know, we continue to operate against quite a challenging macro economic backdrop, which has led to difficult market conditions in both advertising and programme commissioning. But despite this, I'm pleased that we've grown the business in each of our divisions of broadcasting, streaming and production. The fact is we are now a much more balanced business, thanks to the diversification strategy that's been implemented over the last few years. This was designed to make us more resilient and to be able to navigate difficult times, and so it's proven. We've been helped this year, I think, this is the first half by some early signs of improvements in the market conditions and from the boost of the Euros 24 football tournament, which has flowed through to revenues and viewing shares. And in studios, we're a much broader mixed ecology in the enlarged studio business, and that's allowed us to benefit from more returning series as well as winning high profile commissions. And that remains a priority for us going forward and key to trapping growth opportunities internationally, as Simon was alluding to. The board is very much focused on the stretching targets of revenue growth, cost reduction and margin improvement that we've set right through to 2026. And I'm pleased to say that we're on track. and already making solid progress to deliver against those targets. We remain very excited about the future of the business and building the momentum to deliver for our customers, for our viewers, for partners, and for you, our shareholders. Going forward, though, as you know, there will be some changes to STD in the second half of this year and before we meet again for the full year results. So what are those? Firstly, Simon Miller, who's served on the board since 2016 as our senior independent director, our employee director, and latterly as interim chair of the Audit and Risk Committee. Simon's decided to step down in December, and I'd like to take this opportunity to thank him sincerely for his outstanding commitment to STV over the past eight years. His counsel and support has been highly valued by me and the rest of the board. This month, we welcome Colin Jones, as a new non-executive director and as chair of the Audit and Risk Committee. Colin has a really impressive track record as a FTSE 250 CFO and over the past few years as a non-executive director and chair and brings with him a great deal of media and financial experience to the board. I'm sure he'll be a real great addition to our knowledge and skill base. But the big one, as we enter the next phase under new leadership, having announced that Rufus Radcliffe will join STV as our new CEO in November. Rufus was a standout candidate who I think really gets the culture of STV and brings with him a rare breadth of strategic and operational experience. We think he's a perfect fit. continue STV on its growth trajectory. And I speak for the whole of the company when I say we very much look forward to working with him. And I know he's looking forward to meeting each of you in due course. And finally, as you know, Simon leaves at the end of October. Simon's been exceptional. His vision and tenacity and business now has ensured that STV has not only survived, but has thrived during very challenging times of company restructure, of industry reset, of COVID and of economic slowdown over the last six years. Simon led the successful transformation and diversification of STV into the dynamic business it has now become and without which we simply would not have been able to deliver the solid results for shareholders we're talking about this afternoon. Simon's incisiveness, collaborative approach and his integrity is matched by a real passion for the brand. the company and the people he works with. And he'll be very much missed by the board and colleagues at STV. Simon, I'd like to thank you sincerely for your commitment to the company and wish you the very best of luck in your new role. But before you go, just one more thing. We have some results to present, some questions to answer. So back to you for one last time, Simon.

Thank you, Paul. That is very much appreciated. As Paul says, this is my final set of results for STV and it's been a real privilege to lead this business and serve STV shareholders for the last nearly seven years. We've achieved a lot together in that time and the success of our transformation strategy, rooted as it is in digital streaming and in our ownership of valuable content, together with the strength of the foundations that have been laid for the future, comes through very clearly in the results we're presenting to you today. So in a challenging economic climate, we've continued to accelerate the delivery of our successful plan and generated top and bottom line growth in the first half of 2024, increasing total SCV revenues by 20% and adjusted operating profit by 33%. Within that, our studio's revenue grew by 38%, bucking the trend in the wider global production market as new commissions swelled our forward order book to over £100 million for the first time. Our streaming revenues through SDV Player grew by 14% while maintaining our strong digital margin. The advertising market improved markedly in the first half, leading to broadcast revenue growth of 12% and an immediate boost in broadcast profits of 47%. A highly successful Euro 2024 football tournament helped us to 13% growth in our total ad revenues across national, digital and regional. And we're also expecting low single digit growth in advertising revenues in Q3, although we remain cautious for the full year, not least due to tough Q4 comparators containing the Rugby World Cup from last year. Our successful investment strategy in SV Studios continues to deliver tangible results. And we've today announced an incremental investment in Glasgow-based formats creator Hello Halo, taking our stake from 30 to 51% in a deal that will be earnings enhancing for us from day one. On screen, our audience position remains very strong with another record first half performance from STV Player and our channel STV still the most watched in peak in Scotland for the seventh year in a row, both helped by Euro 2024, of course. Overall, we remain firmly on track to deliver the ambitious three-year growth targets for the business that we set out back in March this year and I'll provide more colour on that in a bit. And against that backdrop, a strong first half performance with a degree of caution over the UK economy in the second half. The board is recommending an interim dividend of 3.9 pence per share in line with 2023. OK, over to Lindsay to delve deeper into the financial results.