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Channel 4 may draw on £75m credit facility as ‘market shock’ drags on

Channel 4 CEO Alex Mahon

Channel 4 may look into accessing its £75m revolving credit credit facility next year, chief Alex Mahon told the Commons Culture, Media and Sport committee today.

Mahon said that C4’s revenue is expected to fall around nine per cent in 2023 as the channel enters “market shock territory.”

She went on: “This level of market fall has only been deeper in the 2008 recession. I imagine through the next year we will look at how we use that debt facility, that would be normal course of business for us,” adding that so far the broadcaster had not seen signs of an expected recovery towards the end of the year.

The Channel 4 chief added that Channel 4 would look into the possibility of beginning in-house production at the same time as it considers its credit options, athough she predicted the process would be “super slow.”

Channel 4 last drew on its credit facility, which has just been renewed until 2027, at the start of the Covid-19 pandemic, but it has been under pressure in recent months to explore the move once again amidst a commissioning slowdown and criticism from producers for declining programme spend. Mahon conceded that it is currently a “really difficult” time for the indie sector.

Perhaps mindful that former culture secretary Nadine Dorries might be watching (though possibly not listening) Mahon also stressed that Channel 4 “won’t be depending on state subsidies,” and revealed that she expects 58% of Channel 4’s income to come from linear advertising in the immediate future, but that digital advertising is a “big growth market.”

Elsewhere in a wide-ranging session in front of the committee, Mahon faced questions on the future of Gogglebox (“I wouldn’t expect Gogglebox to go anywhere else. It’s a classic Channel 4 show”), herself (“most” speculation on her future is “untrue”), Russel Brand’s time at the channel (“proud” a Channel 4 news team helped break the story), and Channel 4 chiefs’ deferred bonuses (which Channel 4 chair Ian Cheshire described as “signalling” in the face of a £700m content budget.)

Mahon and Cheshire added that they would launch a strategic review early next year into Channel 4’s strategy for the next decade, which they announced today.

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