[Podcast] ITV With Roland Head And Maynard Paton

02 April 2023
By Maynard Paton

I have recorded another podcast with my good friend Roland Head. This time we talked about Roland’s shareholding in ITV, which currently yields 6% for his income portfolio. We discussed the broadcaster’s business strategy, growth opportunities, industry challenges and lowly valuation:

We cover: 

  • ITV’s recent results, the 6% yield and Roland’s portfolio purchases. 
  • The bull case for ITV, being a UK ‘TV champion’ and consistent viewing habits.
  • ITV’s financial history, dividends being skipped and the near-term outlook for advertising.
  • The growth of ITV Studios, international production opportunities and 26 overseas versions of Love Island.
  • The move towards higher quality dramas, extra scripted content and further sales to streaming services.
  • The structural decline of television advertising, and reduced conventional viewing versus rising streaming hours.
  • ITV’s digital advertising, the Planet V platform and potential ‘scalable’ economics. 
  • The cost of advertising on ITV, with regional options starting at just £6. 
  • ITV’s pension-deficit payments, upfront production costs and regular exceptional items. 
  • ITV’s operating margin, return on capital employed and ITV Studios appearing undervalued.
  • Capitalising programme costs, ITV3 repeats from 1976 and the hidden value of the back catalogue. 
  • Hasbro buying Entertainment One during 2019 suggesting ITV shares are undervalued.
  • ITV’s revenue per employee, debt and past special dividends.
  • Chief exec Dame Carolyn McCall, her business plan and the poor disclosure of director options.  
  • Britbox, airtime-for-equity investments and System1 advert testing. 
  • Our concluding thoughts on ITV’s strategy, valuation and potential.

Extra links:

Happy listening!

Maynard Paton

PS: The episode was recorded on 29 March 2023.

Disclosure: Maynard own shares in System1.

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