STV Group — Broadening content and reach

STV Group (LSE: STVG)

Last close As at 11/03/2025

0.00 (0.00%)

Market capitalisation

More on this equity

Research: TMT

STV Group — Broadening content and reach

STV’s full year results were in line with market expectations, with acquisitions helping push revenues up 12% in a tough market for both commissioning and advertising, particularly in H224. Total advertising revenue (TAR) for the full year was up by 5% (pre-commission), having been up 13% at the half-year, and is expected to continue to be soft for the first four months of 2025. It is still early days for the new CEO, Rufus Radcliffe, to be making his mark, but his initial assessment is that the business has strong foundations and is well positioned for market recovery. He is now working on putting together a strategy refresh that will see the group through to 2030 and which should be unveiled in May this year.

Fiona Orford-Williams

Written by

Fiona Orford-Williams

Director, TMT

Media

QuickView

12 March 2025

Price 168.00p
Market cap £78m
Price Performance
Share details
Code STVG
Listing LSE

Shares in issue

46.7m

Net cash/(debt) at 31 December 2024 excluding non-recourse production financing

£(28.8)m

Business description

STV Group is Scotland’s home of news, entertainment and drama, serving audiences with high-quality content on air, online and on demand.

Bull points

  • Breadth of content offering.
  • Growing reach with initiatives such as Premier deal.
  • Continuing cost saving programme.

Bear points

  • Lack of economic confidence suppressing advertising and commissioning.
  • Financing burden including from pension issues.
  • Inflationary cost pressures.

Analyst

Fiona Orford-Williams
+44 (0)20 3077 5700

EDISON QUICKVIEWS ARE NORMALLY ONE-OFF PUBLICATIONS WITH NO COMMITMENT TO WRITING ANY FOLLOW UP. QUICKVIEW NOTES USE CONSENSUS EARNINGS ESTIMATES.

STV Studios portfolio offers increasing range

STV Studios generated most of STV’s FY24 growth, climbing to 45% (FY23: 40%) of revenues and to 24% (21%) of adjusted operating profit, post consolidation of Northern Ireland’s Two Cities Television and two labels in Glasgow and London. STV Studios is now the UK’s second largest nations and regions producer, and is targeting the number one slot. The portfolio of 21 labels, covering a wide range of genres, gives some resilience when commissioning budgets are under pressure. There are also a growing number of lower-risk commissioning options from returning series and new versions of existing intellectual property. The order book stood at £76m at end-February, down on the start of the year as scripted programmes are delivered, but with good levels of active conversations reported in slow markets.

Ongoing project to increase subscriber numbers

Linear broadcast remains an important part of the mix and is an effective way for advertisers to reach large audiences quickly and effectively. Total broadcast revenues were up 4% year-on-year, with a margin improvement driven by cost control. Live viewing via the STV player had a good year, helped by the sports offering (particularly the UEFA Euro 2024 tournament) and this is now extended with a new bundling partnership with Premier Sports. Third-party content is also driving audience growth, including outside of Scotland.

New financing arrangements should reduce costs

The group refinanced its revolving credit facility in February for £70m with a £20m accordion, on maintained covenants but without the previous margin ratchet. The additional national insurance costs are unlikely to be offset by the ongoing cost containment efforts, but the interest cost savings are helpful. The strategy refresh will extend past the likely timetable for the resolution of historical pension issues.

Source: company accounts, LSEG Data & Analytics

Consensus forecasts

Year end Revenue (£m) EBIT (adj) (£m) PBT (£m) EPS (p) DPS (p) P/E (x) Yield (%)
12/23 168.4 12.4 17.0 27.20 11.30 6.2 6.7
12/24 188.0 20.6 18.0 29.00 11.30 5.8 6.7
12/25e 214.1 25.4 22.9 34.11 11.90 4.9 7.1
12/26e 242.7 30.0 27.0 40.49 12.20 4.1 7.3

General disclaimer and copyright

This report has been prepared and issued by Edison. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright 2025 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or sol icitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

More on STV Group

View All

Latest from the TMT sector

View All TMT content

Research: Financials

JDC Group — Strong FY25 guidance and FY30 targets

JDC Group (JDC) has reported very strong preliminary Q424 results, with revenue growth of 28.4% and record EBITDA of €5.9m (Q423: €5.0m). Growth was driven by the platform Advisortech division, but Advisory activities were also strong. Management provided FY25 guidance of €245–265m in revenue and EBITDA of €18.5–20.5m, as well as mid-term guidance of €450–500m turnover with EBITDA of €40–50m by 2030. CEO Sebastian Grabmaier and CFO Ralph Konrad have extended their contracts to 2030. Our estimates are under review pending the final results, which will be published on 31 March.

Continue Reading

Subscribe to Edison

Get access to the very latest content matched to your personal investment style.

Sign up for free