ITV has furloughed approximately 15% of its UK workforce after advertising revenues plummeted last month in the wake of the enduring coronavirus pandemic.
The British commercial broadcaster said Wednesdsay (May 6) that nearly 800 employees have been placed on the federal government’s job retention scheme after ITV was forced to shed £100 million from its production budget.
Since mid-March, the company’s production arm ITV Studios has had to pause the majority of its productions globally as a result of the restrictions on working practices. As a result, the bulk of cuts have directly impacted ITV Studios.
In a trading statement, ITV said that it would be taking part in international schemes “where appropriate” while also implementing a recruitment and salary freeze.
“ITV has taken swift and decisive action to manage and mitigate the impact of COVID-19, by focusing on our people and their safety, and by continuing to reduce costs and tightly manage our cashflow and liquidity,” said ITV chief executive Carolyn McCall in a statement. “We are also ensuring that we continue to inform and entertain our viewers and stay close to our advertisers. Everyone at ITV has responded extremely well to the challenges we are facing.
“We are now very focused on emerging from this crisis in a strong position, continuing to offer advertisers effective marketing opportunities and making preparations to restart productions safely.”
In its first quarter results, total external revenues at ITV over the last three months have also taken a hit, dropping by 7% to £694 million compared to the year-ago period that brought in £743 million. ITV Studios, meanwhile, saw its total revenues dip 11% to £342 million (£385 million in 2019), impacted by the phasing of deliveries and restrictions on working practices due to COVID-19.
Advertising revenues at the free-to-air commercial broadcaster, meanwhile, plunged 42% in April as marketing spend all but ceased amid the global coronavirus crisis.
The broadcaster has additionally launched plans to reduce overhead costs by £60 million this year — double its previous target — to help offset the impact of COVID-19. ITV also said it was in discussions with the government and others across the media industry “on a return-to-production protocol.”
ITV said it has access to £100M in unrestricted cash it can dip into, as well as £630 million in revolving credit facilities, expiring in December 2023, and £300 million in bilateral facility expiring in June 2026 of which £199m is available.
“We are using rigorous internal and external analysis and scenario planning to continue to monitor the COVID-19 situation and its impact on the business. This is informing our planning and decision making and we will take further action as necessary to manage our costs and cash tightly,” the company said in a statement.