Carlton Communications, one of the largest media companies in Britain, has slumped into a loss of £277.9m sterling in the first half of the year and warned that an advertising slowdown will continue in the second half.
After accounting for discontinued operations and spending of £141.5m on digital media, Carlton reported the loss after a profit of £26.9m in the same period last year. Excluding exceptional items, profits were down 32% to £65.8m.
This figure by the group, which dominates commercial television network ITV, was just above market expectations. First-half sales were £530m, against £501.6m a year earlier.
Carlton blamed an advertising slowdown, particularly the effects of the US downturn, for the drop in profits. Advertising revenues fell by 6%, and Carlton said the slowdown would continue into the second half of the year.
The foot and mouth crisis and the timing of the British general election has also unsettled some sectors, Carlton said.
Carlton said it believed the advertising downturn was 'cyclical, not structural' and that ITV's audience strength and the recent restructuring of ONdigital, the digital terrestrial television service jointly owned between Carlton and Granada, meant that the group was well placed to emerge strongly when the advertising market recovers.
