LONDON — Yorkshire-Tyne Tees Television will report a year loss of T5.25 million ($ 7.9 million) today and may skip its final dividend, analysts forecast.
The company has already said it expects a loss, partly because it sold more advertising time than it could deliver. The warning cost CEO Clive Leach his job.
The size of the loss will depend on whether the company chooses to charge all of a revenue shortfall estimated at about T15 million ($ 22.5 million).
But Yorkshire-Tyne Tees TV’s attractions as a takeover prospect in the ITV ownership reshuffle are preoccupying the market.
Market talk is that the next step in the takeover round unleashed by government relaxation of ownership rules will be a bid for Yorkshire-Tyne Tees from London Weekend Television, itself the target of a hostile bid from Granada Group. London Weekend TV already holds about 14% of Yorkshire-Tyne Tees.
Newspaper owner Pearson also has 14%, but media cross-ownership rules prevent it from bidding for an ITV broadcaster. The government is to review those rules next year.
Any ITV broadcaster bidding for Yorkshire-Tyne Tees would be forced to offload the Tyne Tees broadcast franchise under the new rules, which say one company can hold only two licenses (except the two London licenses, which must be separately held).
Yorkshire-Tyne Tees is the only company to combine more than one franchise among 15 regional license areas.
Its first-half dividend was 3.3 pence (4.95 cents) a share on pretax profit of T3.8 million ($ 5.7 million). Its year pretax profit last time was T16.11 million ($ 24.2 million) and its year dividend 12 pence (18 cents).
The company’s biggest burden is its license fee, the legacy of the 1992 auction for ITV franchises. The combined bill for Yorkshire and Tyne Tees franchises is T52.8 million ($ 79.2 million) for the 1993 calendar year, and rises according to a formula based on the retail price index.