Taggart Loss Expected to Have Little Impact on STV Profits

The loss of long-running crime drama series, Taggart, from the ITV schedules might cost its makers, STV, around £3 million in revenues, according to a report in the Sunday Herald. But it is not expected to have a serious impact on profits.

Deputy business editor, Steven Vass, quotes Paul Numis, media analyst at Numis Securities, estimating that ITV’s decision to axe the iconic show will only take around £300,000 off the bottom line.

Numis is quoted as saying: “The group average content margin is about ten per cent, so losing £300,000 from a group that is forecast to make around £17 million in 2011 should mean that they will be able to offset the loss elsewhere.”

Vass, who was formerly media correspondent for the Sunday Herald before it dropped that slot, points out: ”The fact that the news had no effect on the company’s share price last week is a far cry from the effect that it might have had a few years ago.

“In the middle of the decade, Taggart, which dates back to 1983, was estimated to have been worth around £1 million a year in profits at a time when the company was on the verge of going bust. Had it been axed at that time, when it was virtually STV’s only production, it might have been much more serious.

“The news came days after STV and ITV reached a deal over their programming dispute, but there are no signs that ITV’s Taggart decision was anything other than commercial. Top dramas on ITV1 and BBC1 have been pulling in audience shares of well over 20 per cent, whereas the average share for the latest Taggart series was only 13 per cent.

“In Scotland, in contrast, the average share was 33 per cent – highlighting the appetite for local programmes. Together with the fact that Taggart still does decent business in overseas sales, this Scottish strength explains STV’s announcement last week that it intends to find a production partner to keep the series alive.

“If STV cannot find a partner, it will be a serious blow to its production strength in Scotland. The company is thought to be as heavily reliant on making The Antiques Road Trip for BBC Two as it once was on Taggart, having received a new commission for 60 episodes. It mainly otherwise makes regional fare, principally magazine show, The Hour, and the local news.”

Last year, STV made a pre-tax profit of £12.5 million on revenues of £111.7 million.