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ITV Will Aim To Cut Costs By $33M Next Year Amid Post-Brexit Uncertainty

ITV, Britain's biggest commercial broadcaster, will aim to cut £25M ($32.8M) of costs next year "whilst the economic outlook remains uncertain" after the vote to leave the EU, according to Lauren Fedor of the FINANCIAL TIMES. ITV CEO Adam Crozier said that it was "too early to say" what impact Brexit might have on advertisers' spending "but did not rule out job losses." ITV "provided no other details" about the planned cost-cutting program. Crozier said that advertising revenues had fallen in February but "reassured" there had so far been no "second gear" in revenue declines after the U.K. voted to leave the EU last month. Shares in ITV rose more than 8% on Wednesday after advertising revenues were boosted by Euro 2016 (FT, 7/27). In London, Christopher Williams reported Crozier said that the negative forecasts "were driven by increased competition for viewers from the Olympics on the BBC" and tough comparatives with a record September last year. He said, "I don't think the result of the vote really changed anything so far. I think people are starting to realize that actually nothing much is going to happen soon and that this is going to be a two- to five-year process." Around half of ITV's revenues and most of its profits "are drawn from advertising." Big audiences for live football "helped reverse a long-term decline in the broadcaster's share of viewing." The main ITV channel was up 7pc compared with last year (TELEGRAPH, 7/27). In L.A., Leo Barraclough reported Crozier added that the fall in the value of the pound since the Brexit vote "would actually lead to an increase in revenue and profit for ITV," mainly because of its "substantial production and sales business in the U.S.," which is in dollars. If the exchange rate stays at its current level, he said, "over the full year the impact would be roughly £74 million [$97M] more revenue and around £13 million [$17M] more profit, and that's because we are doing a lot in America" (VARIETY, 7/27).

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