Yorkshire-Tyne Tees, the ITV licence holder, remains committed to launching a rival news service for Channel 3, in competition with ITN, Ward Thomas, the company chairman, said yesterday.
"There should be plurality in a democracy," Mr Thomas said, confirming that YTT remains interested in backing a bid by Rupert Murdoch's Sky News to become a nominated news provider for the ITV network.
The rival news service, also supported by ITV companies HTV, Meridian and Anglia, is being developed by Sky and Reuters, the financial information company, and Sky has indicated it could undercut ITN's pounds 57m-a-year news contract by as much as pounds 27m. A formal proposal is due to be presented to the Independent Television Commission, the regulating body of commercial television, within weeks.
Mr Thomas made his comments following the unveiling of pre-tax profits ahead 60 per cent at pounds 21.6m, compared to pounds 13m on a pro-forma basis last time. Revenues rose to pounds 261m from pounds 244.7m, helped by advertising sales ahead 9 per cent to pounds 169.1m. The company received pounds 8m under the controversial levy imposed on Channel 4 as part of the so-called "safety net" arrangements. These payments are due to be phased out by 1998.
Financial results had been depressed by a disastrous overselling of advertising slots in 1994, which required repayments to advertisers.
"We have put all that well and truly behind us," Mr Thomas said. "Our results confirm that."
The company has pushed the dividend payment for 1995 to 14p from 4.8p, reflecting the improvement.
A restructuring programme is now nearly completed, and the company does not expect further redundancies.
YTT has been the subject of persistent takeover rumours, particularly since Granada, the TV and leisure company, controversially took its stake to 25 per cent last month. Mr Thomas said yesterday he was convinced Granada would not mount a hostile bid, but left the door open to an agreed bid, repeating his contention that the ITV sector would consolidate under perhaps just three companies over the next year or two.
Mr Thomas ruled out future investments in cable, but confirmed an interest in satellite broadcasting. He also reiterated YTT's call for an early review of the licence payments made by ITV companies to the Treasury. YTT paid pounds 64.2m last year.Reuse content