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Highlights:

  • STVG lowers FY25 revenue forecast to GBP 165–GBP 180 million, citing weakened ad and commissioning markets.
  • STVG’s STV Studios updates guidance, now expects GBP 75–GBP 85 million in revenue at ~4% margin due to delays.
  • STVG identifies GBP 2.5 million in cost savings for FY25, plans further initiatives into FY26.

STV Group plc (LSE:STVG) has issued a trading update ahead of its interim results for the six months ended 30 June 2025, indicating that full-year revenue and adjusted operating profit are expected to fall materially below consensus expectations. The company cites a further deterioration in the UK commissioning environment and advertising market late in the first half and into the second half of the year. For FY25, STV Group now forecasts revenue between GBP 165 million and GBP 180 million with an adjusted operating margin of approximately 7%. The downward revision reflects updated guidance for both the Studios and Audience divisions, particularly in light of market headwinds.

STV’s new Audience division, formed from the consolidation of its Broadcast and Digital units, has reported H1 total advertising revenue (TAR) in line with prior guidance. However, the company flagged a weaker-than-expected Q3 outlook, impacted in part by difficult comparatives due to UEFA Euro 2024 broadcasts in the prior year. STV now expects Q3 TAR to decline approximately 8% year-on-year, with July projected down 20% and August–September performance forecasted as flat. This results in a full-year revenue estimate of GBP 90– GBP 95 million for the Audience division, with an operating margin between 13% and 15%. The shift in advertising sentiment has affected business confidence and media spending decisions across the sector, contributing to the downward revision in guidance.

The commissioning market has seen a notable contraction in late H1 and early H2, impacting STV Studios' revenue profile. Several projects in late-stage development have either been delayed or shelved, primarily affecting the company’s unscripted labels. Although 13 new unscripted commissions were secured in Q2, changes in delivery timelines and phasing have led to a revised full-year revenue forecast of GBP 75– GBP 85 million for the division, with a projected adjusted operating margin of about 4%. The company’s scripted business remains active, with current projects for platforms including Netflix, Apple, Sky, and the BBC. Despite these engagements, the Studios unit has seen its forward order book fall from GBP 66 million in April to GBP 54 million, reflecting both project delivery and the slowdown in new commissions.

In response to market conditions, STV has identified incremental cost savings of GBP 750,000, bringing its FY25 savings target to GBP 2.5 million. Further efficiency measures are under review and expected to contribute to FY26 results. Net core debt stood at GBP 30 million at 30 June, up marginally from GBP 29 million at year-end 2024. Production financing decreased from GBP 10 million to GBP 5 million during H1, due to programme deliveries. The company’s long-term “FastFwd to 2030” strategy remains in progress. Developments include plans for a new radio station under its audio business and continued structural integration of Audience operations.

STVG trading at 26.99% lower at GBX 139.44 per share as on 28 July 2025.