ITV half-yearly profits plummet 28%

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The group's adjusted pre-tax profits came in at £91 million for the six-month period, compared with £127 million a year ago.

ITV - headed by industry veteran Michael Grade - said its total net advertising revenue (NAR) was flat in the eight months to August compared with a year earlier. However, September's NAR is expected to be down 20% because of a weaker market and the impact of last year's Rugby World Cup on the figure.

The broadcaster also said it was slashing its interim dividend in half, and targeting an extra £35 million of cost savings by the end of 2010.

Mr Grade, who is spearheading a turnaround plan for the company, said: "As a result of the recent slowdown in the television advertising market, the board has taken some tough decisions which are reported here today."

ITV said that, as a result of reduced advertising forecasts for this year and next, it has been forced to write off £1.6 billion of goodwill associated with acquisitions made in 2000 and 2004.

The accounting hit created a statutory pre-tax loss of £1.54 billion for the six months to June 30, compared with £105 million of profits a year ago.

Mr Grade, who is ITV's executive chairman, said UK television advertising held up relatively well over the first half of the year and through the summer.

"However, on current estimates, the television advertising market has weakened significantly in September," he said.

Mr Grade is forecasting the total advertising market in the third quarter to fall by around 9%.