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ITV Revenues Down 3% Amid Drop in Profit for ITV Studios

ITV recorded a 3% drop in revenues of £1.5 billion ($1.95 billion) and an 8% fall in adjusted EBITA profit of £403 million in the first half of 2017, weighed down in part by a decline in profits at its production and distribution arm, ITV Studios.

Britain’s biggest commercial broadcaster blamed the decline at ITV Studios on its investment in its budding U.S. drama business and the absence of revenues from “The Voice of China.” Revenue at ITV Studios rose 7%, to £697 million, but profit went down 9%, to £110 million.

ITV executive chairman and interim CEO Peter Bazalgette said Wednesday that the overall numbers were in line with expectations and that the strategy of re-balancing the business is working.

“ITV’s performance in the first six months of the year is very much as we anticipated and our guidance for the full year remains unchanged,” Bazalgette said. “We are confident in the underlying strength of the business as we continue to invest both organically and through acquisitions.”

ITV said its studio unit was performing well despite the absence of revenue it recorded last year from “The Voice of China.” The company also said that it was continuing to invest in the U.S. scripted business, which was still building momentum, with projects such as “Snowpiercer” in the works. ITV America, the part of the broadcaster’s U.S. business that makes unscripted programming, recorded a 49% rise in interim revenues of £143 million.

ITV said it had made its first earnout payment to Talpa after buying the John de Mol-created production company in 2015.

Amid the ongoing debate about the gender pay gap between male and female stars at the BBC, Bazalgette told reporters that the broadcaster will not divulge figures in the same manner as the BBC. “We do take gender issues, employment and pay very seriously, but we are a commercial broadcaster,” he said. “We would never discuss confidential contracts.”

Incoming CEO Carolyn McCall, whose appointment was announced earlier this month, will join ITV at the start of 2018. Current management said it was sticking to its full-year targets despite uncertainty, notably in the advertising market, where Brexit is causing caution among big advertisers. Bazalgette, a reality TV heavyweight after his time on “Big Brother” while at Endemol, said he was a big fan of U.K. summer TV hit “Love Island,” which has generated ITV2’s best ever ratings.

ITV also gave an update on the Britbox U.S. streaming service, which it runs in association with BBC Worldwide. Bazalgette would not divulge subscriber numbers, but said marketing would be ramped up in the second half of the year. Finance boss Ian Griffiths said the partners were looking at taking the service into other territories.

“In the coming months we will look at what we can do to push that internationally,” Griffiths said.

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