“Pretax profit highest in Group’s 17-year history”
The Seventeenth Annual General Meeting of Associated Television Corporation Limited was held in London on September 28th 1971. The following are extracts from the Statement by the Chairman, Lord Renwick of Coombe, K.B.E., for the year ended 26th March, 1972:
The Group Profit of £6,240,000 [£70.3m in today’s money allowing for inflation – Ed] before taxation is the highest in the 17-year-old history of your Company.
This wholly admirable result shows an improvement of 27 per cent on the profit for the preceding year and fully justifies the confidence which I expressed at the time of the half-yearly interim statement.
This confidence remains unimpaired. Accordingly, your Board has recommended an increase in the total dividend for the year from 28½ per cent to 30 per cent, and proposes to recommend an increase in the Corporation’s share capital and a scrip issue.
Approximately half the Group Profit was derived from the Network operation and half from diversified activities. This is entirely healthy. And it is in both these fields that a continuing growth is to be foreseen.
Prospects for Television
The initial expanded schedule on Monday 16 October 1972 shows that whilst the new hours are welcome, there’s not all that much ITV as a whole can do with them. After programmes for schools, programmes for toddlers with a new series called Rainbow at 12.05 followed by Larry the Lamb, both from Thames. Then it’s the ITN lunchtime news at 12.40, using the title First Report. HTV brings Mr & Mrs at 1pm, while YTV offers a gentle rural soap opera called Emmerdale Farm at 1.30. The network splits at 2pm. ATV has Shirley’s World, a terrible ITC sitcom starring Shirley MacLaine; most other places took All Our Yesterdays from Granada. At 2.30pm companies had the choice between two programmes for women – Good Afternoon! from Thames or Houseparty from Southern – although Tyne Tees ran a cooking programme in that slot. Most regions ran a film at 3pm until the start of children’s programmes – ATV picked The Over-Hill Gang, a 1969 comedy western TV movie. Anglia used the slot to run ITC’s The Saint again, before inserting its toddlers’ show Romper Room in the lead up to the kids block.
From the Autumn of this year, the enforced restriction on broadcasting hours will be lifted, and ATV Network will be able to transmit programmes from mid-day onwards and thus provide the housewife with a full afternoon service of news, entertainment and information. This long-awaited development in the ATV Network operation is something which your Board has always been seeking.
The lifting of the restriction will mean that Independent Television in the Midlands will be on the air for an extra 40 hours a week. This extension of the Service will offer entirely fresh opportunities not only for new programmes, both local and national, but also for both new and established local and national advertisers.
The market demand is certainly unquestionable, and the extension of hours should be seen against the background of the year’s trading in which advertising revenue rose by nearly 14 per cent, from £14,255,000 [£160.5m] for 1970-71 to £16,232,000 [£182.8m] for 1971-72. It was this increased volume of sales, together with the reduction of Turnover Levy (£2,483,000 [£28m] for 1971-72 as against £3,865,000 [£43.5m] for 1970-71) which enabled the Network to do more than absorb the increase of nearly £600,000 [£6.8m] in the rental payable to the Authority.
Nor is large-scale growth foreseeable only in the operation of Television in the U.K. The export potential both for film series and for Special Programmes is enormous, and your production and distribution subsidiary ITC-Incorporated Television, and your American distribution subsidiary, Independent Television Corporation, are once again in a dominant position in the market. This situation could not have been achieved without a massive investment of some £7,000,000 [£78.8m]. Benefits from the income generated by this investment will be reflected in the current and subsequent years.
The other main subsidiaries are all in good order and offer assurance for the future.
Stoll Theatres Corporation and Moss Empires enjoyed a year which fell only slightly below the previous record year and the present year promises well.
It remains to be said, however, that over the whole world of the theatre hangs the ominous question mark of Value Added Tax. If this tax — from which newspapers, for example, are to be completely exempted — is applied indiscriminately to the theatre, then the results will inevitably be far-reaching and deplorable. Such a tax, without alleviation, may well compel the eventual closure of certain Provincial theatres.
Records & Tapes
I am happy to be able to report that Pye Records has more than maintained its 10 per cent share of the total UK record production. Precision Tapes has, in its first two years of trading, achieved sales amounting to nearly one-third of the total UK market for tape cassettes and cartridges.
Northern Songs’ music catalogue has been further strengthened by a new seven-year co-publishing agreement to cover future compositions with Paul and Linda McCartney. In order to rationalise, the whole of ATV’s interests are shortly to be re-grouped and controlled by ATV Music Limited.
Planned Music, which provides the Muzak service is also steadily expanding.
Indeed, within the Group the results of only two of the subsidiary companies, Ambassador Bowling and Bermans & Nathans, have proved disappointing.
Property & Investment
Of especial importance to the Corporation is your subsidiary, Bentray Investments Ltd., which is responsible for all ATV properties.
The last valuation of Land and Buildings was made in 1966, and a full re-valuation is being undertaken during the current year. This operation will serve not merely to enable a realistic figure to be quoted under Fixed Assets, but to provide a proper financial basis for the development of various of the Group’s valuable properties in London and elsewhere.
Up to date, Bentray’s major development — representing an investment of some £12,000,000 [£135m] — has been confined to Birmingham. The 29-storey, 200,000 square-foot office tower at ATV Centre will be available for tenancies by December.
In the Spring of 1973 the Holiday Inns Hotel at the Centre will be ready for occupation. During the coming year, therefore, the greater part of the whole six-acre complex will become revenue earning.
In June 1972, ATV’s holding of 4,290,000 shares in British Relay Wireless and Television Ltd., was disposed of for a profit before tax of £2,519,810 [£28.4m] and the cash inflow will serve most usefully to reduce current finance charges.
Directorate, Management and Staff
To the Corporation’s Deputy Chairman and Chief Executive, Sir Lew Grade, I must extend not only my thanks but my congratulations. ATV and Sir Lew are by now synonymous.
Finally, I extend my thanks to Management and Staff at all levels in Birmingham, Elstree, London, New York, Toronto, Sydney, Paris and Lausanne.
|Year to 26th March||1972||1971||1972 + inflation||1971 + inflation|
|Profit before Tax||£6,240,000||£4,914,000||£70,262,400||£55,331,640|
|Earnings per A Stock Unit||9.79p||8.18p||110.24p||97.01p|
|Divident per A Stock Unit||7.50p||7.12p||84.45p||80.17p|
About the author
As a public company with shareholders, ATV was required to publish a detailed Annual Report at the end of each financial year. It was common to also publish a Chairman's Statement, summing up the report in more readable language.