British broadcaster ITV said a tough advertising market would continue in the April to June period as a lack of major events and economic uncertainty dampens company spend, hitting its shares.

The stock fell 5 per cent in early deals on Thursday (May 11) as the group behind UK hit shows like Coronation Street and I’m a Celebrity issued a quarterly update.

Trading was in line, it said, but it guided to total advertising revenue (TAR) for the second quarter to be 12 per cent lower, putting it behind current analyst forecasts.

Companies are cutting their advertising budgets as persistently high inflation in Britain caps consumer spending, creating an outlook for advertising which the company called “challenging as expected”.

ITV pointed to an improvement in the third quarter, however, as the return of a popular reality show and a world sports event boosts ad spend again.

“We are looking forward to Q3 with Love Island and the Rugby World Cup set to draw large broadcast and streaming audiences,” the group said.

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Citi analysts noted the worse-than-expected second-quarter TAR, but said “overall we expect a limited impact on full-year consensus estimates”.

For the first three months of the year, ITV said TAR fell 10 per cent, as expected, and added that its new streaming service ITVX was performing well. Reuters