STV Group has issued a profit warning as a result of a “further deterioration in the commissioning and advertising markets.”
The broadcaster and producer said group revenue for the full year is now expected to range from £165m to £180m, at an adjusted operating margin of around 7%.
STV said it had identified incremental cost savings of £750,000, and predicted “further cost savings” for the next financial year. It will update the market on those savings in September, when it publishes interim results for the six months to the end of June 2025.
The company said STV Studios has been hit by “significant commissioning market deterioration in late H1 and early H2 as the UK macroeconomic backdrop has worsened.”
It said that in non-scripted, this has resulted in “some projects in advanced development not being green-lit and some commissions being delayed to 2026.”
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The company added: “Our unscripted labels have delivered significant commissioning success in Q2, with 13 unscripted commissions secured, but due to the changing market conditions we have updated the phasing and timelines for future deliveries.”
Although STV Studios is developing an international business, most of its customers are UK-based so the division has “been disproportionately impacted by the recent slowdown in the domestic market.”
The production division, STV Studios (STVS) has revised its full year outlook, saying revenues will come in between £75m-£85m,at an adjusted operating margin of around 4% as lower volumes “impact fixed overhead recovery”. STVS delivered revenues of £84m in 2024.
Its forward order book currently sits at £54m, compared with £66m at the end of April, due to the “slowdown in commissions won and the recognition of revenue on programmes in production.”
However, its scripted labels “remain strong” and it is working on projects for Netflix, Apple, Sky and the BBC, with “no change to our expectations of their financial performance this year.”
In its audience division, made up of its broadcasting and digital divisions, Q3 2025 expectations are lower than expected, “due to the recent further deterioration in the advertising market”, meaning the quarter’s total advertising revenue, “is now expected to be down c. 8% with July down c.20%”, although that period last year included the boost from the final games of the men’s 2024 Euros. August and September are predicted to be “broadly flat”.
Despite the profit warning, the company said the key components of its FastFwd to 2030 strategy are “underway”, with plans for a new radio station “progressing to plan” and “the creation of a single Audience business providing opportunities to simplify and streamline our operating model.”
STV Group chief executive Rufus Radcliffe said: “The deteriorating macroeconomic backdrop continues to lower business confidence impacting both markets in which we operate.
“We’re making good progress in combining and streamlining our Broadcast and Digital businesses into a new Audience division, and launch plans for the creation of our radio station are going well, with key appointments made and infrastructure plans forging ahead.”
He added: “STV Studios delivery schedule for the remainder of 2025 has been impacted by the UK commissioning market, which has further weakened at the end of H1 and into the second half of the year.
“However, in addition to winning new and repeat business in H1, we have completed production on key titles with international appeal, including high-end drama Amadeus for Sky and a third series of Blue Lights for BBC One, with the second series of The Fortune Hotel airing on ITV and STV this summer – and our development pipeline is strong.
“We are proactively responding to market conditions through a combination of investing in targeted future growth initiatives aligned with our long-term strategy and identifying efficiency and cost saving opportunities across the business.
“There continues to be strong long-term growth potential within our business despite the short-term challenges, and we remain [focused] on delivering on the strategic plan we outlined earlier this year.”
