ITV reports 52% drop in H1 earnings on tough ad market

LONDON (Reuters) - British broadcaster ITV reported a 52% drop in first-half adjusted earnings to 152 million pounds ($197 million), below market forecasts, which it said reflected a tough advertising market and investment in its streaming service ITVX.

Chief Executive Carolyn McCall said strong growth in Studios and Digital revenues in the first half largely offset the weakness in the ad market, resulting in total revenue declining just 1% in the period.

"ITV maintained its strength in linear in a challenging advertising market," she said on Thursday.

"Looking forward we see a more encouraging outlook as advertisers build their campaigns around the large streaming and linear audiences expected to be drawn to the Women's World Cup, the Rugby World Cup and the eagerly anticipated return of Big Brother."

The broadcaster said its total advertising revenue was expected to be down 4% in July and up 7% in August.

It said it was too early to give a forecast for September but early signs were positive and it expected to see growth in the third quarter.

($1 = 0.7724 pounds)

(Reporting by Paul Sandle; Editing by Kate Holton)