Feb. 29 (Bloomberg) -- ITV Plc climbed the most in almost a year in London as the U.K.’s biggest commercial broadcaster reported 2011 profit that beat estimates after expanding services that rely less on advertising.
Profit, excluding financing and tax adjustments and other one-time items, rose to 7.9 pence a share in 2011 from 6.4 pence a year earlier, the London-based company said in a statement today. Analysts in a Bloomberg survey had estimated 7.1 pence.
Chief Executive Officer Adam Crozier is reducing the company’s dependence on advertising as growth in the market slows. ITV expects to spend 25 million pounds ($40 million) this year on projects including development of online content and digital channels, according to the statement. ITV reported 43 percent of its sales came from non-advertising sources last year, compared with about 40 percent in 2010.
“The increase in non-advertising revenues of 93 million pounds, driven by our studios and online businesses, is clear evidence of progress in rebalancing the company and our ability to grow new revenue streams,” Crozier said in the statement. “We remain cautious on the market outlook for 2012 but we expect to outperform the market for the full year.”
ITV climbed as much as 8.9 percent to 87.70 pence, the biggest intraday advance since March 2, and was 8.8 percent higher at 87.55 pence as of 9:11 a.m. The shares have gained 28 percent this year.
Sales rose 3.7 percent to 2.14 billion pounds. Analysts estimated 2.11 billion pounds in a Bloomberg survey. The company, whose network plays shows including “Coronation Street” and “Downton Abbey,” struck deals with British Sky Broadcasting Group Plc, Netflix Inc. and Amazon.com Inc.’s Lovefilm to put more content online. ITV will also start offering online news, similar to a service offered by the British Broadcasting Corp., in the next few weeks, Crozier said.
Non-advertising revenue is expected to decline 2 percent in the first quarter, the company said. ITV is “cautious about the economic outlook” and expects advertising sales to outperform the industry for the full year.
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