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Adam Crozier shouldn't be wasting time worrying about Liberty's intentions, says Nils Pratley

July 31, 2014

Nils Pratley



ITV

Adam Crozier shouldn't be wasting time worrying about Liberty's intentions, says Nils Pratley

Close your eyes and you might almost think ITV's interim results incorporated an early draft of a defence document should Liberty Global, the cable group that is now a 6.4% shareholder, put a takeover bid on the table. The centrepiece of the ITV show was a shiny new dividend policy: investors can expect ordinary distributions to rise by an eye-catching 20% a year for the next three years.

Actually, the idea that ITV was playing clever Liberty-inspired games is clearly nonsense. The broadcaster emerged from its crisis at least two years ago - it even paid a chunky special dividend last year - so shareholders deserved to know what a "normal" dividend policy would look like. A commitment to 20% a year sends the right message about "capital discipline" given that its chief executive, Adam Crozier, has developed a strong appetite for buying production houses.

ITV's interim figures - revenues up 7% and adjusted pre-tax profits 16% better at pounds 312m - were less flashy than the dividend, despite the World Cup boost. Overall share of viewing in the UK fell 5%, but there is a reasonable argument that the in-house production division has a stronger release schedule for drama in the second half.

Either way Crozier shouldn't waste a minute wondering about Liberty's intentions. Gut instinct says Liberty boss John Malone is up to something - paying pounds 481m for Sky's stake in ITV looks like more than a casual flutter - but ITV should just get on with the job.



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Source: Guardian (UK)


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