A Memorable Year Yielding Eminently Satisfactory Financial Results

SUCCESS OF BOARD’S DIVERSIFICATION POLICY

The Industry’s Growth Continues

MR. PRINCE LITTLER’S REVIEW OF ACTIVITIES

The Fifth Annual General Meeting of Associated Television Limited will be held at A.T.V. House, Great Cumberland Place. London, W.1, on 28th September 1960.

The following is the statement by the chairman, Mr. Prince Littler, C.B.E.. which has been circulated with the report and accounts:-

The year under review has proved to be a memorable one and has yielded eminently satisfactory financial results.

The proposed dividend means that the Company will have maintained its dividend at the equivalent of 100%, bearing in mind that the capital of the Company was doubled during the course of the past financial year.

Board’s Policy

The principal business of your Company is that of a Programme Contractor licensed by the Independent Television Authority to trade in London and the Midlands, and it is primarily upon this trading that these excellent results have been achieved. It has, however, from the inception of the Company, been the policy of the Board to make investments in allied fields both at home and abroad and, in consequence of this policy, the resources of your Company are now more strongly diversified than any time since it commenced trading.

Developments overseas have proved particularly gratifying in Australia and in Canada. It should, moreover, be noted that in the USA, your Company has recently acquired full control of the Independent Television Corporation of America.

The diversified interests at home are highly encouraging and include the operation of the Muzak franchise, a 50% interest in Pye Records and a substantial and most profitable investment in British Relay Wireless. All these developments will be reported in detail later in this statement.

Success of Consolidation Policy

Your Company has been actively trading for some years. The period of licence from the Independent Television Authority extends until July 1964 and your Board has, with conspicuous success, sought to consolidate the Company’s position as the only major seven-day-a-week Company operating under licence from the Authority.

At the outset of operations your Managing Director, Mr. Val Parnell, and his Deputy Managing Director, Mr. Lew Grade, resisted the pressures put upon them to equip large studios and to build large offices. The volume of programming both for ATV’s own domestic purposes and for the Independent Network as a whole has, however, necessitated a plan of expansion, carefully phased over the past and current years. Your Company has therefore purchased the important riverside site at Vauxhall. Moreover, the Company has proceeded to enlarge its Elstree Studios in order to meet the steadily increasing commitments of live, tape and film production for home and overseas television as a whole.

New Headquarters

During the past year the headquarters of Associated Television Limited have been moved from Television House, Kingsway, to an island site office block in Great Cumberland Place, W.1. The effect of this move has been beneficial to the Staff, and has resulted in a marked increase in inter-departmental efficiency.

The financial results reflect the confidence expressed by your Board in December 1959 when an interim dividend of 8s. per share, less income tax, was declared on the Ordinary Shares of £1 each, and 2s, per share, less income tax, on the ‘A’ Ordinary Stock Units of 5s. each.

Bonus Issue Approved

At an Extraordinary General Meeting held on the 21st January 1960 the shareholders passed a resolution, submitted by your Directors, for the capitalisation of £2,325,000 [£44.3m in today’s money allowing for inflation – Ed] of reserves by the issue of 9,300,000 ‘A’ Ordinary Shares of 5s, each, credited as fully paid, to the holders of the then existing issued share capital in the proportion of four new shares for each existing Ordinary Share of £1 each and one new share for every existing ‘A’ Ordinary Stock Unit of 5s, each. The new shares, on issue, were converted into ‘A’ Ordinary Stock Units of 5s, each.

Profits & Dividends

The Group profit before taxation for the year ended 30th April 1960 amounted to £5,388,330 [£102.6m] as compared with £5,316,493 [£101.3m] in the previous year. Taxation takes £2,711,820 [£51.65m] as against £2,715,076 [£51.72m]. The Group net profit is £2,676,510 [£51m] of which £1,031 [£19,600] is attributable to outside shareholders of subsidiaries leaving a profit attributable to the Parent Company of £2,675,479 [£50.96m] as against £2,601,048 [£49.54m] last year. The subsidiary companies retain £76,852 [£1.5m] leaving £2,598,627 [£49.5m] to be dealt with in the accounts of the Parent Company. To this amount must be added £1,711,215 [£32.6m], the balance brought forward from the previous year, and £445,000 [£8.5m] transferred from General Reserve – making a total of £4,754,842 [£90.6m] before appropriations. Your Directors propose recommend a final dividend of 6/- per share on the Ordinary Shares of £1 each and 1/6 per share on the ‘A’ Ordinary Stock Units of 5/- each. The interim dividend already paid and the proposed final dividend absorb £1,424,063 [£27m]. After deducting this amount, together with the sum of £2,325,000 [£44.3m] involved in the capitalisation effected in January and a transfer of £500,000 [£9.5m] to Investment Reserve, there is a balance of £505,779 [£9.6m] to be carried forward in the accounts of the Parent Company.

The accounts include provision for the distribution of £264,171 [£5m] for the Staff Profit-Sharing Scheme.

Home Investments

In the field of your Company’s home investments, it should be recorded that during the year British Relay Wireless and Television Limited made a bonus issue of one 5/- Ordinary Share for two 5/- Ordinary Shares. From this issue you Company obtained 134,000 new 5/- Ordinary Shares by way of capitalisation and the Conversion Right attached to your Company’s holding of £500,000 [£9.5m] 7% Convertible Unsecured Loan Stock 1967-1968 was increased from 184 to 201 shares for each £100 of stock. In March 1960 British Relay Wireless and Television Limited made a rights issue of two new 5/- Ordinary Shares for five 5/- Ordinary Shares and your Company subscribed for 562,800 new Ordinary Shares of 5 at 19/- each, which was its entitlement in respect of its shareholding and under the terms of the Loan Stock Trust Deed. The Stock is convertible on the 30th September 1961. The shares to which your Company would become entitled on conversion would, if there is no change in the present market price, have a value of approximately £1,100,000 [£21m]. British Relay Wireless and Television Limited has recently made a major extension in the Glasgow area and your Board remains confident that this investment will continue to grow.

New Franchise Acquisition

The subsidiary company which handles the sale of Muzak is developing most satisfactorily and a wide range of customers, including Banks, Hospitals, Hotels and Factories as well as Supermarkets, Restaurants and Shops, are installing this service. In the course of the current year operations have been extended to Birmingham and will shortly be followed by similar expansion in Manchester. In this connection shareholders will be interested to learn that we have acquired the Muzak franchise for Australia and New Zealand and it is felt that there is great opportunity for development of a background music service in this area.

Pye Records, in which your Company has a 50% interest, has been largely reorganised and the new plan of direct distribution to retailers has proved an outstanding success. This, together with the excellent reception given to the ‘Golden Guinea’ records, has had a marked effect upon the gramophone industry as a whole.

Your Group’s British production subsidiary ITC-Incorporated Television Company Limited continues to make good progress, During the past year the number of commercial television stations throughout the world has more than doubled and we are now actively selling programmes in a continually expanding market. The series ‘Danger Man,’ which is still under production Elstree, has been sold over the full Canadian network at a price higher than that previously paid for any similar series. Further series and pilot films are in the planning stage and will shortly commence production.

Overseas Investments

As regards investments overseas in the USA, Independent Television Corporation Inc., which, as at 30th April 1960, we held a 50% participation, has continued to handle the distribution of your Company’s film productions and has achieved a turnover of close to $10,000,000 [$103m]. During most of the period under review conditions have been particularly difficult, largely because of the increasing tendency by the three major television networks to assume an attitude of inflexibility towards programmes proposed by the independent producing companies. Recently, however, there have been signs of a slight improvement in business generally and your Board remains of the opinion that it is vital for the Group to have a direct outlet to the American market.

Since the end of the financial period under review we have purchased the balance of the share capital of Independent Television Corporation Inc. at a price which your Board regards as satisfactory. Having acquired control of the company we have taken steps to strengthen the management and to reduce the overheads of the operation and are confident that in time, and with adequate product available for distribution, this company should prove profitable to the Group. Nevertheless, in view of present uncertainties, you will see that your Board, as a measure of prudence, has set aside in the accounts before you a sum of £500,000 [£9.5m] to Investment Reserve.

In Canada your Company has purchased 25% (the maximum permitted under Canadian law for non-Canadian investors) of CJCH – the Halifax, Nova Scotia, radio station which has been awarded the licence for independent commercial television in that area.

The diversified interests of your wholly owned Australian subsidiary continue to prosper. Commercial radio in general is maintaining its level of profit and commercial television is expanding rapidly. The Sydney Commercial Television Station showing increasing profits and the Queensland and Adelaide Stations are rapidly advancing to profit-making stage. Altogether the Group’s television investments in Australia, which have a book value of nearly £250,000 [£4.8m], have grown in value to a sum greatly in excess of the amount invested. Since the end of the financial period under review ATV (Australia) Pty. Limited has sold the Artransa studios and the film production side of the business to Station ATN, the Sydney Commercial Television Company, in which we hold 9.7% of the share capital. We have retained the profitable radio transcription side of the business.

Level of Acceptability

All these investments business at home and it should ancillary to the Company’s main be recognised that the success of forward in the accounts of the any independent television company must depend upon the degree of popular acceptance of its those programmes by those members of the British public whom it serves. Here, it is noteworthy to add that during the calendar year January to December 1959 the level of acceptability in London (where the weekday programmes are provided by another company) has been 69% against the BBC’s 31%, whereas in the Midlands (where Associated Television Limited has the five-day operation) during the same period the level of acceptability has been 74%, against the BBC’s 26%.

Documentary and Religious Programmes

Despite the fact that such popular productions as Mr. Val Parnell’s ‘Sunday Night at the London Palladium’ have continued to occupy a high place in the ‘Top Ten,’ your Company has been responsible also for such serious documentary programmes as ‘We Dissent’; ‘The Western’ – an enquiry into the popularity of Western films; a medical programme, ‘Fear Begins at 40’: ‘The Art of Architecture’; the series of five lectures by Sir Kenneth Clark on ‘Revolutionary Painters’; the lectures on British Prime Ministers by Dr. A. J. P. Taylor; and the ‘Right to Reply’ series in which Mr. William Clark interviewed among others, Mr. Selwyn Lloyd. Mr. Hugh Gaitskell, the late Aneurin Bevan, Father Trevor Huddleston, M. Jacques Soustelle, M. Hammarskjöld, the late John Foster Dulles, Mr. Krishna Menon, Mr. Henry Cabot Lodge, Mr. Paul Hoffman, and Mr. Norman Manley, Prime Minister of Jamaica.

It will be remembered that Associated Television Limited was the first company to introduce regular religious programmes in Sunday television and those who took part during the past year included their Graces the Archbishops of Canterbury and York, the Bishops of Kensington, Lincoln, Manchester, Woolwich and Bedford, the Roman Catholic Archbishop of Liverpool, Dr. Heenan, Dr. Donald Soper and Lord Woolton.

Notable Achievements

Notable also have been those series which, while serious in content, have nevertheless secured maximum audiences. The series ‘Emergency – Ward 10’ has throughout the greater part of the year played to a weekly audience in excess of 20 million viewers. The new series ‘Probation Officer’ has proved equally successful and has earned wide praise from social workers and the Church alike.

Among British companies, your own Company has maintained its lead in the field of international television film production. In addition to such series as ‘Four Just Men’ and ‘Danger Man,’ produced in this country, the Company is just completing a series, ‘Whiplash,’ in Australia.

Company’s Major Role

Your Company has continued to play a major part in the independent television industry itself. Your Deputy Chairman, Mr. Norman Collins, has for the past year acted as Chairman of the Independent Television Companies Association and is currently also the Chairman of Independent Television News Limited, the company which provides the news bulletins for all stations. Mr. James Drummond, the Financial Director of your Company has for the past year acted Chairman of the General Purposes Committee of the Independent Television Companies Association. Mr. Bill Ward, Productions Controller of your Company, is the current Chairman of the Society of Film and Television Arts and I am pleased to place on record that he is the recipient of the Award of the Guild of Television Producers and Screenwriters for the best Light Entertainment Producer of 1959.

The Industry’s Growth

The television industry as a whole continues to grow and it is pleasing to note that during the year under review the ITA has appointed new companies to serve East Anglia and Northern Ireland and has erected a satellite station to give coverage to the Dover area.

By April 1960, 47,578,000 viewers were within reach of programmes broadcast from the ITA transmitters and the average total peak viewing audience for independent television is now over 13,000,000, compared with the BBC’s 5,500,000, as measured by TAM in homes with a choice of programmes.

Your Company’s operations have from the outset been divided between London and the English Midlands and the proportion of locally produced programmes in the Midlands is higher than that of any other independent company.

Your Company, nevertheless, continues to feel that an uninterrupted seven-day-a-week operation in any one area is calculated to provide the most satisfactory service to viewers, and your Company again places on record the fact that, in the public interest, it would welcome the introduction of new stations providing alternative services, so that genuine competition could be assured.

Relations with the Independent Television Authority, under its Chairman Sir Ivone Kirkpatrick, G.C.B., G.C.M.G., have been most closely maintained and I would like to express the gratitude of your Board and more particularly of the Executive Directors for the unfailing service rendered by the officers of the Authority at all levels

Tribute to Management and Staff

As in other years I would, as Chairman, like to pay tribute to the services rendered by the Management. Your Company’s Managing Director, Mr. Val Parnell, and your Deputy Managing Director, Mr. Lew Grade, have continued not only to shoulder the heavy responsibility of the manifold interests of the Company but have added to their other duties by arduous business missions abroad. In addition, non-Executive Directors have continued to render most valuable services to the Company. They have given generously of their time and I would like to express my thanks to them.

Finally, I am happy to report that the Staff in all departments continue to reveal all those characteristics of enthusiasm which have served to build up the Company and I am sure the shareholders will wish to join me in thanking them for their loyal services rendered during the past year. It is gratifying that the Staff Profit-Sharing Scheme again enables the Company to show its appreciation of their efforts.

The post ATV financial results: 1960 appeared first on THIS IS ATV NETWORK from Transdiffusion.

WIDENED FIELD OF PROGRAMMES

INCREASING VOLUME OF ADVERTISING

MR. PRINCE LITTLER ON EXPANSION PLANS

The annual general meeting of Associated Television, Ltd., will be held on July 29 at Television House, Kingsway, London, W.C.

The following is the statement by the chairman, Mr. Prince Littler, C.B.E. which has been circulated with the report and accounts:–

When I addressed you at the last Annual General Meeting the Company was only just emerging from the financial shadows of the the opening period when every week of operation meant an additional heavy loss to your Company. It is not too much to say that your Company, the first to come forward ready to take the challenge of operating an independent service, was more heavily penalized by events than any of its competitors. The unavoidable delay in opening the Midlands transmitter meant that for a period of five months the Company was burdened by full overheads while forced to forgo approximately 50% of its legitimate market.

Those days are now past. In the result your Company has taken its full share in the expansion of the television broadcasting industry. Advertising revenue has continued to build up with the growth of the Independent Television network. New stations have come into operation in Scotland and Wales the past year – and the number of viewers able to receive Independent Television programmes is now approximately 20,000,000. The continued increase in the volume of advertisement bookings confirms the growing confidence of advertisers in the value of television as the best means of reaching and holding the public. On the other hand, programme costs have also risen despite increased networking, but this is unavoidable if we are to pursue our policy of improving on past standards.

Profit and Dividend

The profit after taxation for the year ended 30th April, 1958, amounted to £1,997,909 [£38m in today’s money allowing for inflation – Ed], eliminating the debit balance of £483,794 [£9.2m] brought forward on the Profit and Loss Account and providing for the arrears of dividend paid on 16th December, 1957, amounting to £125,832 [£2.4m], and the interim dividend of 10% paid on the 25th April, 1958, amounting to £91,786 [£1.8m], there remains a credit balance on Profit and Loss Account of £1,296,497 [£24.6m]. From this your Directors have recommended payment of a final dividend of 20% on the “A” Ordinary and Ordinary Shares, absorbing £183,573 [£3.5m], to which must be added a Deferred Share dividend of £29,884 [£568,000], in accordance with the Articles of Association. The Directors also recommend that the sum of £750,000 [£14.3m] be transferred to General Reserve, leaving £333,040 [£6.3m] to be carried forward on Profit & Loss Account.

During the year, a staff profit-sharing scheme was introduced, and provision has been made for a distribution of £146,562 [£2.8m]. For the first time since inception of the Company, provision has been made for the payment of Directors’ fees amounting to £29,000 [£551,000]. You are accordingly asked to pass the necessary resolution for this purpose.

Balance Sheet Items

Turning to the Balance Sheet, you will see that the amount of “A” Ordinary Shares issued and fully paid has increased by £292,880 [£5.6m], as a result of conversion of a similar amount of 6% Convertible Unsecured Loan Stock 1960-63. Fixed assets after provision for depreciation have risen by £77,977 [£1.5m]. The principal addition to fixed assets comprises a freehold property and buildings which are being adapted for urgently needed storage and studio space. The liquid position of the Company again shows marked improvement in the Bank Balances, Sums on deposit and Cash in hand standing at £8,203,732 [£156m]. The balance of the mortgage on the Company’s studios at Elstree has been called for repayment on the 31st January, 1959.

With the Company’s increased trading and with the large number of programmes produced for the I.T.A. network as a whole, the Company has experienced a grave shortage of essential office and studio accommodation. Accordingly, the lease has now been negotiated for new office premises, adequate to the expanding needs of the Company in a centrally situated block which is being designed to meet the Company’s requirements. Moreover, a suitable studio site within easy reach of the West End has now been selected and negotiations for its acquisition are currently proceeding.

Improvement in Liquid Position

With the improvement in the liquid position of the Company, the Board has given its attention to investing in the United Kingdom in allied and ancillary fields. As a first step in this direction your Company acquired on the 9th May, 1958, £500,000 [£9.5m] 7% Convertible Unsecured Loan Stock in British Relay Wireless & Television Limited with attractive conversion rights into ordinary shares in 3 and 4 years’ time. British Relay Wireless & Television operates television and radio relay services over parts of London and in many other urban areas, as well as a television and radio rental business, and by the extension of its operations creates new television viewers for our own programmes.

Your Board, moreover, is currently seeking to negotiate the purchase of one of the major producing companies specialising in the production of films for television. The company question has an outstandingly successful record, notably in the American market. Your Board feel that, in the acquisition of this company, your own Company’s position in the production field would be greatly strengthened.

Development Overseas

During the year the Board has given considerable attention to opportunities for participation in the development of commercial television and radio broadcasting in English-speaking territories overseas, including the U.S.A. Two of your Directors, Mr. Norman Collins, the Deputy Chairman, and Mr. Richard L. Meyer, have made a number of visits overseas to carry out on-the-spot investigations. One major project to which the Company has signified its assent is at the moment before a Commonwealth Government for their approval; and, in readiness for anticipated developments elsewhere within English-speaking world, the Company either has registered, or is in process of registering, Companies in Canada, East Africa, the West Indies and Bermuda.

Position Notably Maintained

The Company’s pioneer position in providing programmes of wide appeal has been notably maintained and, at the same time, the range of productions has significantly expanded. Since my last report, the Company has embarked on a widening field of programmes dealing with Religion, the Arts, public affairs and matters of general sociological interest. Notable among the religious contributions have been “Christ in Jeans” (as the modern dress Passion Play was entitled by the Press) and a specially filmed documentary record of the British Pilgrimage to Lourdes in the Centenary year; among the outstanding individual contributors have been Dr. George MacLeod, Moderator of the Church of Scotland, 1957-1958, and such leading Nonconformists as Dr. Leslie Weatherhead and Dr. Donald Soper. Moreover, a series of six programmes, introduced by the Archbishop of Canterbury, has been arranged to cover the major issues raised at the 1958 Lambeth Conference.

As regards the Arts, Sir Kenneth Clark, the ex-Chairman of the Independent Television Authority, recently agreed to become Adviser to the Company and initiated a series of widely-acclaimed programmes on which he personally appeared. In the field of public affairs, the series of balanced but still highly controversial programmes, “Free Speech,” continued under the Chairmanship of Mr. Edgar Lustgarten, and the lectures of Mr. A. J. P. Taylor helped still further to widen the scope of Independent Television. The Company has, moreover, recognised its responsibility as a public service by the creation of a special programme unit equipped to deal at short notice with such important and emergent issues as Polio and the Cult of Tranquillizers. Meanwhile, in the general field of programming, Mr. Val Parnell’s “Sunday Night at the London Palladium” continues to maintain its place as a national institution and, to cite another example at random, the dramatic serial, “Emergency – Ward 10,” now enjoys an audience of some ten million viewers twice a week.

Future of British Television

Your Board has considered the Company’s future position in the field of British television as a whole and is firmly of the opinion that in television, as in other fields of life, competition is not only desirable but necessary. Accordingly, I am happy to place the Company on records as saying that it would welcome the introduction of a third television service – in competition with your Company’s own operations – and I feel that it would be in the best interests of the country if it were run on commercial lines. The fact that competition leads to better programmes has already been sufficiently proved. Television entertainment from all sources – including the British Broadcasting Corporation – has improved beyond all measure. New opportunities have been offered to artists, writers and technicians, and British television is, in consequence, richer in talent than it has ever been before. Moreover, in the result, the export business of British television programmes has, for the first time, been established on a substantial basis.

Your Company is at the moment unfortunately handicapped by the fact that its licence from the Independent Television Authority provides for no more than part-time working on two different transmitters, i.e. London and the Midlands. With a third television network run on commercial lines this unsatisfactory state of affairs could be remedied. It is your Company’s firm desire to provide the public of the Metropolis – and through the new network such parts of the country as wish to take the programmes – with an unbroken seven-day-a-week service, exhibiting to the full the potentialities of independent and truly competitive television.

Independent Television Authority

I would like also to refer to the Independent Television Authority, the statutory body set up by Parliament to administer the affairs of Independent Television as a whole. Under the able and experienced Chairmanship of Sir Ivone Kirkpatrick, as under the Chairmanship of his predecessor, Sir Kenneth Clark, the Authority continues to act in the fullest degree as guardian to Parliament and public alike. Moreover, the untiring efforts of the Authority’s Director-General, Sir Robert Fraser, have done more than the viewing public will ever realise to make a practical reality of the provisions of the Television Act of 1954.

In conclusion, I would like to express my gratitude to my colleagues on the Board for their unfailing assistance and advice and also to pay tribute to the loyal service rendered to the Company by the Executives and the Staff in both London and Birmingham.

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So-called “serious” programmes form a group which is much admired (and much misunderstood) We believe that serious subjects can be dealt with responsibly and intelligently while gaining in impact by lively and entertaining presentation. Being serious does not call for pomposity.

Many ATV programmes have demonstrated how a lively approach can grip the viewers’ attention by stimulating thought and opinion.

Cultural programmes need not be rarified by fussy TV treatment! Ability to blend information with alert treatment has been demonstrated consistently by Sir Kenneth Clark in his programmes on art and architecture and by Alan Taylor, the Oxford don whose history lectures (given without notes, illustrations or backgrounds) set new standards in the vast field of informative broadcasts.

No “opinion” programme has been more successful than “Free Speech”, with its discussions laced by frank exchanges and lively personalities.

Topicality is admirably served by “Right to Reply” and “The Warning Voice”. Its interests have been strongly represented in the Midlands by such surveys of current affairs as “Midland Affairs” and “Midland Grouses”. “Midland Montage” continues to supply features which give the background to the news, and “Look Around” has won esteem as a regional documentary.

The range of topical and documentary features is comprehensive. ATV has turned the searchlight of inquiry on many subjects of profound public importance.

They include “Prison Officer”, “Abortion”, “Polio”, “Eichmann” and major studies of the American way of life. These, under the title of “Main Street, U.S.A.” and “The New Americans” were screened immediately before and after the Presidential Election.

In “Mockba Moscow” ATV broadcast the first full uncensored pictures of life in Moscow as Muscovites went about their ordinary duties.

In dealing with subjects of special regional interest we believe that all assignments should be treated as fully and carefully as inquiries which find their way onto the national network. A good example of careful preparation was provided by “The Fighting Midlands…”, a series in which General Sir Oliver Leese discussed and illustrated the history, campaigns and honours of famous Midland county regiments.

ATV were pioneers in the widely-praised dramatisation of social documentary programmes. These include “Emergency – Ward 10” (the screen’s most successful and longest-running serial), “Probation Officer”, the “Deadline Midnight” stories about life in a national newspaper office and “Harpers West One”, a series about day to day events in a London store — on both sides of the counter.

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