scotland’s digital 
media company
annual report and accounts 2010
annual report and accounts 2010 stv group plc
in producing this report we have chosen production 
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stv group plc
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t el 0141 300 3000
wwwstvtv directors’ report
 business review
02 highlights of 2010
04 chairman’s statement
06  a conversation with rob woodward by  
journalist and media commentator ray snoddy
09 chief executive’s review 
 – scotland’s digital media company
10 – broadcasting
14 – content
18 – ventures
22 kpis 20102012
24 performance review
27 principal risks and uncertainties
29 corporate social responsibility
 corporate governance
34 board of directors
36 corporate governance report
44 remuneration committee report
accounts
56  stv group plc consolidated financial statements 
– independent auditors’ report 
58 consolidated income statement
58  consolidated statement  
of comprehensive income
59 consolidated balance sheet
60  consolidated statement of changes in equity
61  consolidated statement of cash flows
62 notes to the financial statements
90  stv group plc company financial statements 
– independent auditors’ report
92 company balance sheet
93 statement of t otal recognised gains and losses
94  notes to the company financial statements
100  fivey ear summary
shareholders
101 shareholder information
103 notice of meeting
designed and produced by t ayburn annual report and accounts 2010
directors’ report – business review 
creating and delivering 
great content across 
multiple platforms means 
that we’re strengthening  
our connections with  
our audiences and our 
advertisers
 t o download a pdf of  
this report visit wwwstvplctv
01 highlights of 2010
stv local launched
stv channel on y outube announced
second series of antiques road trip  
commissioned by bbc2
launch of new sports programme  
stv sports centre
 turnover million
 £105m  
 2009 £90m 
 ebitda million

 £169m  
 2009 £12m 
 
preexceptional
16 41
annual report and accounts 2010
directors’ report – business review  stv player voted best commercial 
catchup site in the uk
stvtv achieves 22 million monthly  
unique users
t aggart cocommission agreed  
with itv and uktv
stv news iphone app launched
 operating profit million

 £14m  
 2009 £9m 
 pretax profit million

 £125m  
 2009 £55m 
56 127
03 chairman’s statement
“ with a strong identity and clarity  
of vision we are delivering an 
entertaining and relevant schedule”
 f or financial updates  
on stv visit wwwstvplctv
last year i reported that i believed 2010 
would be a year of considerable change  
and that has certainly been the case both 
within the company and externally  despite 
the economic environment we have 
produced a very good financial result 
against a backdrop of improved national 
revenues and rigid cost control
operating profit before tax and  
exceptional items is £144m and earnings 
before exceptional items tax depreciation 
and amortisation is £169m national 
airtime revenue performed particularly  
well with growth of 21 yearonyear   
while regionally within scotland the  
pace of economic recovery was slower  
and revenue was flat yearonyear   
however  we continued to dominate  
the scottish marketplace 
once again our chief executive  
rob woodward has aligned his interests 
with that of shareholders shareholders  
will recollect that last year 2009 he and 
his colleagues voluntarily reduced their 
salaries this year he has proposed that  
the performance related bonus he has 
earned in 2010 should be deferred  
subject to future performance for up to  
24 months and payable wholly in shares 
our share price is now beginning to  
reflect the new stv and given the strong 
base that has now been established there  
is scope for further value to be created
the disposal of pearl  dean was 
completed and the general improvement  
in stock market prices had a beneficial 
effect on the pension deficit
we are committed to delivering high  
quality public service content and we  
have continued to enhance this through 
the introduction of new platforms and the 
launch of stv local while much has been 
made in the press about our decisions to 
opt out of some network programmes in 
favour of our own produced or acquired 
content the fact is that viewers have 
responded well as demonstrated by the 
increase in our audience share against 
annual report and accounts 2010
directors’ report – business review  whilst we recognise that changes to the 
television market including increased 
competition the growth of online 
advertising and sales house consolidation 
make a review of crr timely any relaxation 
of this mechanism must take account  
of the need to ensure that the merger 
undertakings put in place to protect the 
interests of the nonconsolidated channel 3 
licensees are not disregarded
during 2010 we confirmed our investment 
in mirriad limited the market leader in 
digital product placement as both a content 
maker and national broadcaster offering 
solutions to advertisers mirriad’s products 
and processes are of great value to stv as 
the rules on product placement are relaxed 
during 2010 we contributed to the 
consultation process undertaken by ofcom 
into the rules governing television airtime 
sales and airtime minutage quotas and 
whilst there is no decision expected on 
these imminently we will continue to 
engage with the regulator on this matter 
so having achieved or exceeded the 
majority of our 2010 kpi targets we can 
look forward to 2011 with confidence and 
excitement stv is a company with a 
focused view on its direction of travel  
and has the team in place to achieve  
our 2011 ambitions
none of the achievements of the company 
would have been possible without a strong 
and supportive board a visionary chief 
executive officer and motivated staff  
my thanks go to all of them for their 
extraordinary achievements
richard findlay
chairman
channel 3 itself across the all important 
peak period having said that 95 of  
our programmes are from the network  
to which we pay a considerable sum of 
money but we are always mindful that we 
are a scottish based service independent 
of itv  and have a clear responsibility to 
produce a balanced schedule relevant for 
audiences in scotland
our digital strategy is firmly on track  
and we have exceeded our stretching  
kpi targets in relation to digital audience 
growth our traffic and audience levels 
have surpassed the targets we set for 2012 
and as a result we have set new higher 
targets for 2011 during the course of the 
year we were delighted to have been voted 
the best commercial catchup site in the 
uk this is an achievement we are 
particularly proud of given the financial 
resources of the competing platforms 
developed by our competitors our dedicated 
y outube channel is delivering extremely 
strong monthonmonth growth in video 
streams and we have achieved 22m unique 
users per month exceeding our target of 
17m up 129 on the same time last year  
we have now exceeded our kpi target  
of one million video streams per month 
demonstrating the value placed on  
our content
as other mainstream media reduce 
services to local marketplaces through 
cutbacks increased syndication and 
consolidation we have taken a contrary 
view seeing a service and commercial 
opportunity with the development of stv 
local we piloted this project in one of the 
more difficult geographical areas for media 
and have been so encouraged by the 
results that we are swiftly rolling out the 
concept to other parts of the country 
our ability to generate audiences and 
revenues for our content across different 
platforms is now firmly established adding 
real substance and strength to our position 
as scotland’s digital media company 
the decision not to proceed with the 
piloting of independently funded news 
consortiums by the new coalition 
government was widely expected we did 
not stand still however  and immediately 
began to consider a range of options to 
develop a sustainable solution that would 
allow us to continue to deliver high quality 
news content across scotland in early  
2011 we announced the launch of a pilot  
to trial the delivery of an enhanced and 
more locally focused news service  
this combined with our investment in  
stv local demonstrates our continuing 
commitment to provide high quality  
public service content
we believe that the government’s decision 
that stv productions should not be 
granted independent production status  
is not conducive to supporting the growth 
of the wider production sector in scotland  
we will continue to push for the necessary 
change of mind to achieve this status 
however  regardless of this our content 
team continue to grow commissions from  
other broadcasters including the bbc 
providing clear evidence of its capability 
and creativity 
 
the litigation involving itv will be heard  
in court during the course of 2011 and 2012 
and while we have always regretted being 
forced to take the defensive action we 
have we are confident that our position  
will prove to have been properly justified
our marketplace is highly regulated and  
we anticipate further changes in this area  
in the forthcoming year  we are confident  
in our ability to respond positively and 
embrace regulatory changes most 
significant are the opportunities presented 
by an increased commitment to supporting 
the growth of locally focused media 
services and the investment in high speed 
broadband infrastructure enabling 
enhanced access to our content for 
audiences across all platforms 
05 a conversation with rob woodward by  
journalist and media commentator ray snoddy
“ clearly defined strategy and progress 
against key operating priorities”
but however innovative will the 
hyperlocal sites actually make 
any money
“it is early days yet however  we have 
made a strong start” confirms woodward
the stv chief executive believes the low 
cost structure will enable the venture to be 
profitable and estimates that breakeven 
might only be 18 months away
on a more conventional scale but also 
involving edinburgh stv plans to launch  
a new edinburgh edition of its 30 minute 
stv news at six programme to add  
to the current services from glasgow  
and aberdeen
all three will continue to carry national and 
international news but woodward notes 
“we see through our own experience that 
the most popular part of our news show  
is when it goes to serve the ultralocal”
ironically the stv local and regional 
expansion comes when itv has been 
reining back its local news services 
the stv strategy chimes with the 
government’s enthusiasm for creating 
more local television in the uk and 
woodward will be looking carefully at these 
proposals which are supported by £40m 
from the bbc licence fee settlement
“there is an expectation of us being involved 
in some capacity it’s work in progress”  
said woodward
the strong results for 2010 announced 
by stv in february demonstrate that 
restructuring is over and the company  
is pushing ahead with organic expansion
debt has been reduced from £180m to 
£52m and should continue to fall
the last of the noncore businesses the 
screen advertising company pearl  dean 
was sold for £1 following the disposals  
of virgin radio and outdoor company 
primesight
but would stv still have sold  
the companies if not forced to  
do so to reduce debt
“getting rid of the companies was 100 
the right thing to do because we wanted  
to focus on digital media in scotland as it 
happens we had to do it anyway stv is not 
a media holding company” the stv chief 
executive insists
woodward has taken a similar robust line 
with itv by dropping programmes stv 
thought would not play well in scotland  
or cost too much 
there have been complaints – about 
dropping the bill – and raised eyebrows 
when the drama series downton abbey  
was not shown in scotland
woodward is unrepentant instead of 
downton abbey stv showed the new 
series of t aggart and matched itv’s 33 
audience share
other programmes shown – about 5  
of the peaktime have ranged from  
local football to films and the australian 
acquired series underbelly
the stv press release issued in february 
2011 hardly set the world alight the 
scottish commercial broadcaster was 
launching three new hyperlocal websites  
in edinburgh to add to a growing number 
across scotland
it is however  a key to what rob woodward 
who four years ago took over a company 
heavily in debt and with question marks 
over its future is trying to achieve
“scotland’s digital media company” as 
woodward has dubbed stv is adding an 
additional leg to the strategy – scotland’s 
local media company 
“the edinburgh announcement takes us  
to 19 sites and over the next 18 months  
we would expect to be covering over 75 
of the population of scotland through 
hyperlocal sites and we will end up  
with 100 or more” says the personable 
woodward the former banker and 
consultant who was also commercial 
director of channel 4
each website is run by a professional 
journalist working in partnership with 
representatives of the local community 
whether it’s the local authority emergency 
services or arts or sports groups
the initiative is part of a strategy to  
ensure stv branded services are available 
anywhere and all the time in scotland 
while trying to tap new sources of 
advertising – in this case classified apart 
from all the usual apps on smart phones 
there are now even stv screens in the 
glasgow underground
annual report and accounts 2010
directors’ report – business review   rob woodward chief executive  
in conversation with ray snoddy
07 a conversation with rob woodward by  
journalist and media commentator ray snoddy continued
into everything from sponsorship and 
market research to product placement – 
now permitted for the first time on  
uk television
woodward is adamant that stv will  
never again go on a corporate spending 
spree which caused so much trouble  
for the company but there have been a 
number of more modest partnerships  
and deals
“we are expanding organically and through 
relationships and partnerships and for the 
foreseeable future that will continue to be 
our way of delivering sustainable growth  
that’s the future vision certainly for the 
next 18 months to two years” says the stv 
chief executive
a partnership with brightcove produced  
an stv equivalent of the bbc’s iplayer in 
six weeks and a stake has been taken in 
mirriad limited a company that can 
digitally insert products to be placed in 
programmes at the postproduction stage
a deal with kinetic content of the us could 
open up the american market stv has 
now secured its first pilot in the us through 
this venture “we are not focused now on  
a particular geography although our past 
has been slightly ‘tartanised’ we are 
moving away from that just look at the 
things we are doing” says woodward  
with enthusiasm
the move to the outside world from the 
scottish fortress is exemplified by a deal 
with y out ube for an stv channel of archive 
programmes news and a daily onehour 
entertainment magazinestyle show called 
the hour
“for the first time in stv’s 53year history 
we are able to start reaching for a global 
audience – the idea of providing high 
quality scottish content to the scottish 
diaspora” explains woodward
the executive acknowledges the sums 
involved are modest to start with but that 
doesn’t hold him back
“the key to me is to learn from experience 
– who wants to watch what and potentially 
in time what are they willing to pay for  
and the only way to find out is by trying” 
says woodward
but isn’t stv  particularly the  
new more compact stv crafted  
by woodward simply too small  
to compete in the media jungle 
inhabited by multibillion  
pound players
“i would argue very strongly that there  
are strong positives to being relatively 
small because it means you can be nimble 
it means you can try things move very 
quickly and take timely decisions”  
insists woodward
the immediate outlook looks promising 
with woodward “cautiously optimistic”  
for the prospects of the television 
advertising market and looking forward  
to the company being operationally cash 
flow positive next year 
his performance at stv so far has recently 
triggered a “not insubstantial cash bonus”
woodward has decided not to take it 
because he believes the company is not  
yet in a strong enough position to take  
such cash out of the business instead he  
is taking the money in shares deferred  
for two years with hurdles in place 
contingent on future growth
rob woodward believes that further growth 
will come – particularly if two things come 
to pass
“sort out the situation with itv  prove that 
we can make money from local and then 
you have really got something and can 
think about expanding outside scotland” 
says woodward
they produced younger  more upmarket 
audiences that overall were 024 higher 
than the itv average
“ a core part of our strategy is the right  
of optout from itv ” says woodward
the declaration of independence from an 
itv dictated schedule is part of a series  
of continuing legal disputes between stv 
and itv due in court in the spring
“we are always working to find an amicable 
solution there is value to be created by 
working together not working against each 
other ” is all woodward will say 
many expect a compromise before the 
hearings begin and house brokers peel 
hunt say that any resolution of the disputes 
which have cost stv more than £35m in 
legal fees already could “provide a trigger 
for a significant rerating of the stock”
woodward is most pleased at the state  
of his kpis – key performance indicators
overall performance metrics have improved 
“very significantly versus last year” and 
seven of the kpis including the digital 
traffic targets have been exceeded one 
achieved with only three underperforming
under alan clements director of content 
stv productions has produced 25 more 
hours of programming in 2010 including 
antiques road t rip for bbc 2 missing 
mums for sky real lives as well as t aggart 
for itv – reducing dependence on itv for 
programme sales to 30 of the total 
compared with 80 in the past another 
part of stv’s stated ambition is to increase 
its share of display advertising in scotland
“over the course of the last three years  
we have increased our percentage share 
from 20 to 25 and we are positioning 
ourselves as an innovator  not just in digital 
but in the way we work with advertisers” 
says woodward
the aim he explains is to develop closer 
relationships with advertisers beyond  
the traditional 30second spot and  
annual report and accounts 2010
directors’ report – business review  the media landscape has continued to 
evolve at a rapid pace in 2010 and we have 
demonstrated our ability organisationally 
and culturally to respond to this increasing 
pace of change and exploit opportunities  
to grow revenues and audiences 
we are a flexible nimble and focused 
organisation able to respond rapidly to 
changing market conditions audience 
requirements and media consumption 
patterns through targeted investment  
we have successfully strengthened the 
business during 2010 augmenting our 
position as scotland’s digital media company 
chief executive’s review
scotland’s digital media company
we are a flexible nimble and 
focused organisation able to 
respond rapidly to changing 
market conditions
 broadcasting page 10  
content page 14 ventures page 18
stv is scotland’s digital media company  
in 2010 we have secured this position 
through the growth of audiences across  
an increasing range of channels and 
platforms we have stabilised the core 
business demonstrating the robustness of 
this through the testing market conditions 
we have responded to in the past year   
we have completed the disposal of noncore 
activities and our digital strategy is firmly 
established
we are committed to creating and delivering 
highquality relevant and entertaining 
content to our audiences across all 
platforms and through this relationship 
providing new and innovative commercial 
opportunities for our advertisers and 
sponsors to target their customers
stv is a transformed business with the 
disposal of noncore assets completed  
debt levels significantly reduced and the 
cost base of the business tightly managed 
we have built in resilience to our business 
that has enabled stv to remain profitable 
through the dramatic downturn in 
advertising revenues whilst continuing  
to make targeted strategic investments  
in key growth areas for the future
 
through the successful implementation of 
our digital strategy and our programming 
strategy we have continued to deepen and 
strengthen relationships with our two key 
stakeholder groups our audiences and  
our advertisers
09 broadcasting is the bedrock of  
our business and brand it gives us  
the visability and trust to connect  
with our audiences and advertisers 
 watch your favourite stv 
programmes on stv player  
wwwstvtvplayer
chief executive’s review continued
broadcasting
annual report and accounts 2010
directors’ report – business review  left to right from top
underbelly
postcode challenge
x f actor
scots at war
champions league
coronation street
the hour
t aggart
politics now
vet school
11 we’ve got it covered  from international 
news now available on our stv iphone  
app to all that is happening in your 
neighbourhood via stv local
during 2010 we have continued to extend 
our reach through the development of new 
platforms and channels and providing our 
audiences with an increased choice in the 
way that they can access our compelling 
content these include an hd service 
further enhancement of our vod service 
through the highly commended stv player 
new digital channels including an stv 
y out ube channel and the launch of mobile 
applications such as the stv jobs and  
stv news iphone apps the stv player  
is also available as a public beta on the 
playstation 3
we have delivered against all of our 
broadcasting kpi targets with the key 
metrics of audience share versus the 
network and the broadcast margin 
exceeded the latter highlighting the 
sustained upturn in advertising revenue 
this is a tremendous achievement given 
the macroeconomic backdrop particularly 
in the early part of the year 
we continue to hold the position as 
scotland’s most popular peak time 
television station reaching 42 million 
viewers every month during 2010 our 
primary digital channel wwwstv tv  
secured the position of scotland’s most 
popular commercial website attracting over 
22 million unique users every month in q4
2010 marked the first full year of the 
implementation of our programming 
strategy designed to engage our audiences 
through a varied relevant and entertaining 
 t o download our free stv iphone 
app visit wwwstvtvnews and follow 
the easy instructions
chief executive’s review continued
broadcasting continued
annual report and accounts 2010
directors’ report – business review  schedule this approach has proved to be 
highly successful delivering a peak time 
audience share in excess of the itv 
network demonstrating our preeminence 
as scotland’s leading media brand 
we have successfully expanded our 
audience profile through the inclusion  
of specific programming to target key 
demographic groups for advertisers
our schedule has been delivered with over 
95 network content and the acquisition 
of programming targeted to address the 
viewing preferences of our audiences  
early in 2010 we broadcast the hardhitting 
drama underbelly rating as stv’s most 
popular acquired series the series also 
attracted over a quarter of a million video 
plays on the stv player and a third series 
has been acquired for broadcast during 2011
we have also continued to grow our  
share of the scottish market place despite 
a slower pace of recovery in this region 
we have continued to offer a wide variety 
of high profile broadcast sponsorship 
campaigns allowing brands to feature their 
brand logo and commercial messages in 
and around key programming guaranteeing 
sponsors a prime position and maximum 
visibility across a mass viewing audience
our inhouse commercial production  
team stv creative has delivered 
continued growth producing winning 
creative content for scottish based and 
network advertising clients the work of 
the team has continued to expand into  
the development of new advertising 
solutions for our clients including the 
production of regional and network 
sponsorship campaigns and shortform 
editorial content and provides our clients 
with a full service commercial offering
we continue to develop innovative 
solutions for our advertisers during 2010 
we launched our social marketing initiative 
this new approach offers innovative and 
flexible solutions for private and public 
sector organisations to expand upon 
broadcast advertising by offering a full 
range of innovative stv services including 
microsites sponsorship online advertising 
pr marketing and social media
our commitment to delivering high quality 
news services to our audiences onair and 
online has continued during 2010 
we have achieved a yearonyear increase 
in traffic to our online news content 
through the combination of our news 
gathering resources located at our news 
centres across scotland and our 
investment in hyper local news services 
through stv local this will deliver an 
increased level of local news provision 
unrivalled by any other provider in the uk
in early 2011 we will pilot a new service 
which if proven will enable us to enhance 
the extent to which we deliver local news 
using a new broadcast technology platform
 t o discover and share your … 
local news sport weather reviews  
events announcements places and 
community visit wwwstvtvlocal
the news journey
of the scottish population  
watch stv news on stv at  
least once a week

stvtv news online 
stv’s iphone app 
stv news at six
stv local – local news  
from where you live 
over
55
13 creating and delivering 
great content is at the 
heart of everything we do
chief executive’s review continued
content
annual report and accounts 2010
directors’ report – business review 
missing mums 
produced for
being victor 
coproduced with
postcode challenge 
sponsored by
in search of burke and hare 
produced for
taggart 
coproduced for
antiques road trip 
produced for
pink saris 
produced for
jack nicklaus’s  
greatest open course 
sponsored by  during 2010 stv productions has achieved 
success in winning commissions from an 
increasing range of broadcasters including 
living sky real lives bbc and itv 
significantly we received our first series 
commission and recommission from the 
bbc antiques road t rip for bbc2 which 
achieved a higherthanaverage audience 
share for the channel
in early 2010 we secured the first  
cocommission of the uk’s longest running 
crime drama t aggart through an innovative 
deal with itv and uktv  this series was 
filmed for the first time in hd and through 
a first run window on stv achieved a  
33 audience share outperforming  
the alternative drama programming on  
the network
the impact of the economic downturn on 
the programming budgets of broadcasters 
resulted in our target for the value of 
external commissions being missed 
however  we have continued to deliver 
yearonyear growth of 25 the key 
financial metric of margin was delivered 
and we are confident of our strong position 
as we enter 2011
we have set out our ambitions to expand 
internationally and a highlight of 2010  
was the partnership formed between stv 
productions and us production company 
kinetic content this innovative format 
deal which allows the companies to 
exclusively license each others original 
formats in their respective countries was 
we have successfully 
broadened our customer base
a highlight of 2010 was the 
partnership formed between 
stv productions and  
us production company 
kinetic content
chief executive’s review continued
content continued
annual report and accounts 2010
directors’ report – business review  confirmed in july 2010 all formats owned 
and controlled by stv including existing 
and newly developed formats from its 
production companies stv productions 
and ginger productions are now available 
to kinetic content to coproduce with  
stv in the usa similarly stv holds the 
exclusive uk rights to coproduce formats 
developed and owned by kinetic content 
the two companies work closely together 
to develop brandnew formats to be pitched 
to broadcasters both in the uk and the us 
this deal provided stv with a targeted  
and cost effective means of accessing us 
broadcasters and similarly opened up  
the uk market to formats developed  
and owned by kinetic content
we continued to strengthen our creative 
team and earlier in the year we were 
delighted to confirm the appointment of 
liam hamilton as deputy director of 
content liam will support the expansion of 
stv productions and the refocusing of the 
ginger productions brand to concentrate 
on developing entertainment formats
whilst we are disappointed at the decision 
taken by dcms not to award independent 
production status to the business we will 
continue to seek to obtain the necessary 
legislative change to provide this status 
our kpi targets do not assume that will  
be granted this change
in late 2010 it was confirmed that television 
rights distributor drg now exclusively 
represents stv productions and ginger 
productions international distribution 
rights drg promotes the two production 
companies to the worldwide market  
under the newly created brand name  
stv international the extensive 2000 
hour stv international programming 
catalogue includes t aggart and an array  
of highprofile factual content the deal 
additionally incorporates a new cofunding 
and development partnership between  
the two companies 
the hour the only daily live tv magazine 
show broadcast outside of london went 
from strength to strength in 2010 and 
attracted top stars such as westlife john 
barrowman and julian clary the hour 
regularly outperforms channel 4 five and 
bbc two is closing the gap on bbc one  
in that slot and regularly attracts up to  
a million viewers a week
17  wherever you are  
visit wwwstvtv
 visit your local stv site to find  
out everything that’s going on in  
your community wwwstvtvlocal
delivering revenue growth  
developing new platforms and
identifying opportunities to take  
stv content to new audiences
 get your latest sports news  
from our stv iphone app
chief executive’s review continued
ventures
annual report and accounts 2010
directors’ report – business review   t o watch your favourite  
stv shows on y outube visit  
wwwyoutubecomstvplayer 
 go to wwwstvjobscom for  
thousands of scottish jobs
19 through innovation in production  
and platform development we are  
reaching new audiences
 stv anywhere – making our  
content available to audiences 
wherever and however they  
want to consume it
in 2010 we have delivered digital growth 
successfully built audiences and traffic 
launched new initiatives and invested in 
digital distribution to create new platforms 
and grow digital revenues we have delivered 
against our stretching kpis in this key 
growth area of the business and on the 
strength of this overachievement of our 
targets we have increased our targets  
for 2011 and 2012
we have exceeded three of our kpis in this 
area relating to traffic demonstrating that 
we have established a valuable content 
rich must visit proposition and securing 
the position of stv tv as the most popular 
commercial website in our marketplace
we are firmly established as scotland’s 
digital media company as part of our 
digital strategy we have created stv 
anywhere our commitment to making our 
content available to audiences wherever  
whenever and however they want to 
consume it for our advertisers this is 
creating new and innovative opportunities 
for brand development and targeting  
of marketing activities enabling them  
to improve their return on investment  
in advertising
in early 2010 we launched our first iphone 
app providing users with instant access  
to the latest news sport and high quality 
video reports on their mobile phones the 
free stv news app which has now been 
downloaded over 80000 times to date 
allows users across the globe to access  
stv branded news content
a cornerstone of our digital strategy is  
the successful launch of stv local during 
the latter part of 2010 leveraging our 
investment in our content and through  
the formation of relationships with 
communities across scotland these  
sites will feature news and information 
from a range of sources making stv  
local a highly interactive experience and 
offering a platform for users to inform 
discover and share everything that is 
relevant to their community this is a 
commercial service with display classified 
and video advertising and is a natural 
extension of public service content in  
a digital environment
we are encouraged by the early level  
of positive audience engagement and 
interest from our advertisers and content 
partners in the stv local platform by  
the end of 2010 our service covers 25  
of the scottish population by local authority 
area and we will continue to implement  
our ambitious programme of rollout of 
local sites during 2011 with edinburgh  
sites being launched during february
t o support us in the execution of stv local 
we have recruited a highly skilled team of 
editorial staff and as rollout continues we 
will recruit community embedded editors 
creating new employment opportunities 
across scotland
chief executive’s review continued
ventures continued
annual report and accounts 2010
directors’ report – business review   for information on  
stv hd visit wwwstvtvstvhd 
our tvondemand service stv player  
provides our viewers with the ability to catch 
up on their favourite stv programmes and 
watch highlights from the vast stv archives 
and it continues to build traffic delivering 
an average of over one million video plays 
per month during the final quarter of 2010 
in september 2010 digital consultants 
webcredible rated the stv player second 
only to the bbc’s iplayer  and ahead of  
all other commercial channels’ services  
– a fantastic endorsement of our digital 
development capabilities particularly given 
the system was developed entirely inhouse 
and on a modest budget
in june we announced a major content 
deal with google making over 2500 hours 
of content both new and archive available 
for viewing via the y outube video sharing 
website across the uk and internationally 
advertiser supported content is delivered 
free of charge and on demand
our digital roadmap addresses the 
anticipated increase in mobile web 
consumption of content and increasing 
expectation of consumers for known and 
trusted brands to be available on mobile 
platforms this demand will be met through 
further plans for our content to be made 
available on an increasing range of 
connected devices including ps3 and wii 
allowing our digital audiences to enjoy 
broadbanddelivered stv content on their 
tv screens y ouview formerly project 
canvas due to launch in 2011 will provide 
further convergence for broadcast and 
broadband services and stv is working  
to capitalise fully on this
we continue to embrace technological 
developments to enhance our viewer 
experience and foster audience 
engagement and have developed a split 
screen application that enables viewers to 
chat and comment on major programming 
events such as the world cup and xf actor 
on their pc screens alongside live video 
feed of stv output
our online classified business site  
stv jobs has been further developed  
to continue to improve the functionality  
of this service through the introduction  
a number of market leading innovations 
including the launch of an iphone app  
and cv magnet stv jobs’ own  
cv database
we have ambitious plans to grow our 
classified business during 2011 through 
exploiting the stv local platform to  
unlock local classified revenues 
rob woodward
chief executive officer
building platforms
stv 
anywhere

extending vod content  
across platforms
providing over 2500 hours  
of stv content in uk  
and internationally
delivering news and information  
services and providing a platform  
for community engagement
delivering scotland’s most  
popular peak time schedule  
in hd quality
21 kpis 20102012
2010 t arget 25
2010 actual 25
2011 t arget 26
2012 t arget 27
2009 actual 23
increased by 9
kpi achieved
2009 actual 90 hours
2010 t arget 110 hours
2010 actual 113 hours
2011 t arget 130 hours
2012 t arget 150 hours
up by 26
kpi exceeded
2010 t arget 17m
2010 actual 22m
2011 t arget upgraded 25m
2009 actual 13m
2012 t arget upgraded 30m
up by 69
kpi exceeded
2009 actual 07m
2010 t arget 10m
2010 actual 20m
2011 t arget upgraded 27m
2012 t arget upgraded 35m
up by 186
kpi exceeded
why it’s important
t elevision advertising is core to our  
broadcast business and our regional 
advertising sales team are employed by  
stv as opposed to our national sales  
which are outsourced to itv sales
how we measure it
using nmr data we compare stv’s  
regional sales with the total display 
advertising market for scotland
increase regional  
advertising market share
why it’s important
a key strategic objective is to grow  
our content business and this provides 
clear evidence of that growth
how we measure it
it is the total of all hours of new 
production delivered in the financial 
year to third party broadcasters
production hours
why it’s important
unique users to our websites are key  
to driving advertising revenues through  
their engagement with the site
how we measure it
using analytical tools the number  
of unique users per month can be  
identified and collated and this is the  
monthly average figure across q4
unique users per month  
q4 monthly average
why it’s important
video streams are a key advertising  
currency and are directly related to 
generating advertising revenues
how we measure it
using analytical tools the number  
of video streams across all platforms 
can be identified and collated and 
this is the monthly average figure 
across q4
video streams per month  
q4 monthly average
broadcasting
content
ventures
the 3year kpi targets have proved to  
be highly effective in providing operational 
focus clarity and consistency in 
communicating our targets and objectives 
in order to maintain this approach during 
2010 and beyond we have reviewed the 
relevance and appropriateness of the 
targets in relation to the growth strategy 
and we are pleased to confirm kpi targets 
which we are confident will support 
delivery of our strategic priorities
new kpi targets have been set for 2011  
and 2012 for the four measures where 2010 
performance exceeded the 2012 target  
in addition the digital revenue kpi target  
for 2012 has been increased due to the 
higher level of operational performance
upgraded kpi targets
• broadcast margin
•  unique users per month  
q4 monthly average
•  page impressions per month 
q4 monthly average
• digital revenue value 2012
•  video streams per month 
q4 monthly average
annual report and accounts 2010
directors’ report – business review  2009 actual 10
2010 t arget 10
2010 actual 148
2011 t arget upgraded 15
2012 t arget upgraded 16
up by 48
kpi exceeded
2009 actual 120
2010 t arget 100
2010 actual 102
2011 t arget 100
2012 t arget 100
kpi exceeded
2009 actual £27m
2010 t arget £52m
2010 actual £42m
2011 t arget £73m
2012 t arget upgraded £105m
up by 50
kpi missed
2009 actual in line
2010 t arget in line
2010 actual 024pts
2011 t arget in line
2012 t arget in line
outperformed by  
024 share points
kpi exceeded
2009 actual £56m
2010 t arget £112m
2010 actual £7 0m
2011 t arget £168m
2012 t arget £21m
up by 25
kpi missed
25
nil
30
35
2009 actual 16
2010 t arget
2010 actual
2011 t arget
2012 t arget
breakeven
kpi missed
why it’s important
our programme strategy results in  
more scottish based content appearing 
on screen and savings being made in 
programme costs but it is key that an 
audience share is delivered at least 
equivalent to that of the itv network
how we measure it
peak audience 18002230 for all  
adults is compared to itv network
peak time audience  
v itv network
why it’s important
in conjunction with the growth in 
production hours it is also important 
that the value of content produced also 
grows and this kpi evidences this
how we measure it
it is the value of new external 
commissions
value of external commissions
why it’s important
page impressions are a key advertising 
currency and are directly related to 
generating advertising revenues
how we measure it
using analytical tools the number of 
page impressions per month can be 
identified and collated and this is the 
monthly average figure across q4
page impressions per month  
q4 monthly average
why it’s important
digital revenue growth is a key strategic 
objective and this measure tracks 
evidence of this growth being delivered
how we measure it
it is the value of revenues generated 
from the group’s various digital 
operations
digital revenue value
why it’s important
margin improvement across the period 
provides evidence of profitable growth
how we measure it
it is calculated as operating profit 
divided by turnover and expressed  
as a percentage
content margin
why it’s important
margin improvement across the period 
provides evidence of profitable growth
how we measure it
it is calculated as operating profit 
divided by turnover and expressed  
as a percentage
broadcast margin
ventures margin
why it’s important
margin improvement across the period 
provides evidence of profitable growth
how we measure it
it is calculated as operating profit 
divided by turnover and expressed  
as a percentage
2009 actual
2010 t arget
2010 actual
2011 t arget upgraded
2012 t arget upgraded
up by 129
kpi exceeded
48m
67m
110m
140m
180m
23 performance review
2010 has seen broadcasting 
revenues recover strongly
2010 has seen broadcasting revenues 
recover strongly from the recessionary 
levels seen in the prior year and this has 
resulted in a very significant improvement 
in the group’s financial performance
this airtime sales recovery combined  
with growth in our content business has 
resulted in profit before tax and exceptional 
items increasing to £125m 2009 £55m 
the strong operational performance was 
also reflected in our kpis with seven 
exceeded one met and only three not 
achieved last year also saw the disposal  
of pearl  dean which concluded the 
corporate disposal programme which 
commenced in 2007  the most significant 
impact from this disposal will be an end to 
the large cash losses which were being 
incurred by this business and were a major 
negative on the group’s cash flows
we look forward to 2011 where we expect  
to see positive cash generation and debt 
reduction as our businesses continue  
to grow
revenue
t otal revenue which comprises both 
continuing and discontinued activities 
amounted to £1117m 2009 £1102m  
the total figure was impacted by the 
disposal of pearl  dean and adjusting  
for this revenues were up by £145m – 
16 due to growth in all 3 divisions
broadcasting revenues at £903m 2009 
£77 8m were up 16 with the main driver 
being national airtime revenues which were 
up by 21
content revenues grew by 21 to £98m 
2009 £81m as production hours 
delivered increased in ventures total 
revenues were up 7 at £47m 2009 
£44m with digital revenues up 50 at 
£42m 2009 £28m reflecting continued 
growth in our online audiences
operating profit
operating profit before exceptional items 
increased by £52m 57 to £144m 
2009 £92m as the revenue growth 
converted strongly to profit this resulted 
in margins increasing very strongly in 
broadcasting from 10 to 15 and the 
2010 target of 10 being significantly 
exceeded
content margins exceeded target at  
102 2009 12 while ventures 
breakeven outturn was below the 25 
target reflecting investment in new  
digital initiatives including stv local
finance costs
net finance expenses decreased by £18m 
to £19m 2009 £37m which was mainly 
due to the anticipated change in the ias19 
non cash pension charge in 2009 of £19m 
becoming a credit of £04m this benefit 
was partly offset by higher cash interest 
costs due to higher average debt balances 
in 2010
exceptional items
exceptional items resulted in a net charge 
of £7 2m 2009 £138m these included 
the final accounting on sale of pearl  dean 
£nil a writedown to film stock inventory 
values £27m and a write off of bank 
facility fees due to amendments made in  
h1 2010 £15m items with a cash impact 
were litigation costs £35m and a cost  
of change provision £09m related to 
restructuring in our sales operation and  
a change of the group’s core business  
from three divisions to two – consumer  
and production to take effect from  
january 2011
the statutory result for the year after tax 
and exceptional items amounted to a profit 
of £53m 2009 loss of £88m
earnings per share
eps before exceptional items increased  
by 140 to 329p 2009 £137p reflecting 
the increase in profit before tax and  
the effective tax rate reducing to nil  
from 10 due to the release of prior year 
provisions and use of brought forward losses
eps on a statutory basis including 
exceptional items amounted to 139p 
2009 loss of 241p
balance sheet
the principal balance sheet movements 
over the last 12 months were a reduction in 
stock as itv network reduced stock levels 
and a reduction in the pension defecit
annual report and accounts 2010
directors’ report – business review  the pension deficit on an ias19 basis  
net of deferred tax decreased to £162m 
2009 £257m reflecting a higher discount 
rate as gilt yields rose and improved equity 
asset values work on the key mortality 
assumption project in the caledonian 
pension scheme continues and we now 
anticipate this project concluding  
in q2 2011
cashflow
net debt amounted to £522m at the year 
end 2009 £494m with the increase due 
to the final year of cash losses at pearl  
dean offsetting cash generated in the core 
businesses as i highlighted earlier  with the 
disposal of pearl  dean now completed 
the cash generation of the continuing 
businesses will become much clearer  
and net debt will quickly decrease  
the continuing businesses converted 
138 of operating profit into free cashflow 
2009 118 well above the target  
of 100 which remains in place going 
forward capital expenditure amounted  
to £08m 2009 £10m with the major 
investments being in hd transmission 
capability and support for the online 
operations we will continue our strategy  
of reducing risk by entering into partner 
relationships to deliver key strategic growth
dividends
the board has previously stated that no 
dividends will be declared for 2010 with 
the improved trading position of the group 
we would normally expect to reinstate 
dividend payments during 2011 however  
the board have decided that while the 
intention is to resume dividend payments 
this will only occur when the outcomes  
of ongoing legal disputes are known
principal activities
the principal activities of the group  
are currently in the production and 
broadcasting of television programmes  
the sale of advertising airtime and space  
in these media and in internet services  
the group continues to focus upon its 
television and new media business
shares and other interests
as at 23 february 2011 the company had 
been notified of the following interests  
of 3 or more in its ordinary shares
t otal shares 
ubs global asset mgt 6232970 1626
fidelity international uk 5159669 1346
odey asset mgt 3937 275 1027
gartmore invest mgt 3205802 836
granada media plc 2650961 691
hanover investors 
partners 2154496 562
investec asset 
management 1800000 470
stv employee  
share trust 1751795 457
murray international 
holdings ltd 1465383 382
suppliers – creditor payment policy
the company’s policy is to settle the terms 
of payment with suppliers when agreeing 
terms of payment by inclusion of the 
relevant terms in contracts and to pay in 
accordance with its contractual and other 
legal obligations t rade creditors of the 
company at 31 december 2010 were 
equivalent to 46 days of purchases  
2009 49 days
compliance
part of the information that fulfils the 
companies act requirements of the 
directors’ report can be found in the 
operating and financial review on pages  
2 to 33 the group’s principal operating 
subsidiaries are listed in note 2 to the 
company’s financial statements and details 
of the principal risks and uncertainties 
facing the company can be found on  
pages 27 and 28
auditors and disclosure of information 
so far as the directors are aware there  
is no relevant audit information that is 
information needed by the company’s 
auditors in connection with preparing their 
report of which the company’s auditors 
are not aware each director has taken  
all steps that he ought to have taken as  
a director in order to make himself aware  
of any relevant audit information and to 
establish that the company’s auditor  
is aware of that information
25 performance review continued
going concern
after making appropriate enquiries the 
directors have a reasonable expectation 
that the company and the group have 
adequate resources to continue in 
operational existence for the foreseeable 
future the financial statements  
are therefore prepared on a going  
concern basis
statement of directors’ responsibilities
the directors are responsible for preparing 
the annual report the directors’ 
remuneration report and the financial 
statements in accordance with applicable 
law and regulations
company law requires the directors to 
prepare the financial statements for  
each financial year  under that law the 
directors have prepared the group  
financial statements in accordance with 
international financial reporting standards 
ifrss as adopted by the european union 
and the parent company financial 
statements in accordance with united 
kingdom generally accepted accounting 
practice united kingdom accounting 
standards and applicable law under 
company law the directors must not 
approve the financial statements unless 
they are satisfied that they give a true and 
fair view of the state of the affairs of the 
company and the group and the profit  
and loss of the group for that period
in preparing these financial statements  
the directors are required to
•  select suitable accounting policies  
and then apply them consistently
•  make judgements and estimates that  
are reasonable and prudent
•  state whether applicable ifrss as 
adopted by the european union and 
applicable uk accounting standards 
have been followed subject to any 
material departures disclosed and 
explained in the group and parent 
company financial statements 
respectively
•  prepare the financial statements  
on the going concern basis unless it  
is inappropriate to presume that the 
company will continue in business
the directors are responsible for keeping 
adequate accounting records that are 
sufficient to show and explain the 
company’s transactions and disclose  
with reasonable accuracy at any time  
the financial position of the company and 
the group and enable them to ensure that 
the financial statements and the directors’ 
remuneration report comply with the 
companies act 2006 and as regards the 
group financial statements article 4  
of the ias regulation they are also 
responsible for safeguarding the assets  
of the company and the group and  
hence for taking reasonable steps for the 
prevention and detection of fraud and 
other irregularities
directors’ statement pursuant to the 
disclosure and transparency rules
each of the directors whose names and 
functions are listed on page 35 confirm 
that to the best of each person’s 
knowledge and belief
•  the group financial statements 
prepared in accordance with ifrs as 
adopted by the eu give a true and fair 
view of the assets liabilities financial 
position and profit of the group and 
company and
•  the directors’ report includes a  
fair review of the development and 
performance of the business and the 
position of the company and group 
together with a description of the 
principal risks and uncertainties  
that it faces
the directors are responsible for  
the maintenance and integrity of the 
company’s website and legislation in the 
united kingdom governing the preparation 
and dissemination of financial statements 
may differ from legislation in other 
jurisdictions
george watt
chief financial officer
annual report and accounts 2010
directors’ report – business review  principal risks and uncertainties
we have rigorous internal 
systems to identify monitor 
and manage any risks to  
the business
risks and uncertainties 2010
like most businesses stv group plc is 
exposed to a number of risks which could 
have an impact on our operating results 
financial condition and prospects we  
have rigorous internal systems to identify 
monitor and manage any risks to  
the business
all of the risks identified have been  
fully evaluated and taken into account  
in preparing the budgets and forecasts 
which support going concern and 
impairment assessments the risks have 
also been reviewed and agreed with both 
internal and external auditors
regulatory environment
our television business is operated under 
licences regulated by ofcom which  
extend until 2014 these licences contain 
conditions relating to such issues as 
regional television programme production 
and matters of taste and decency  it is the 
responsibility of the executive named on 
each television licence to ensure that the 
terms of these licences are adhered to and 
they put measures in place internally to 
ensure that this occurs however  it is 
possible that in certain circumstances these 
terms may be inadvertently breached and 
sanctions imposed by ofcom in the most 
serious of circumstances it is within the 
remit of ofcom for licences to be withdrawn
dependence on advertising
stv’s sales expenses and operating results 
could vary from period to period as a result 
of a variety of factors some of which are 
outside of stv’s control these factors 
include general economic conditions 
conditions specific to general advertising 
markets including the commercial 
television and the cinema markets trends 
in sales capital expenditure and other 
costs and the introduction of new services 
and products by us or our competitors  
in response to an everchanging operating 
and competitive environment we may elect 
from time to time to make certain pricing 
service or marketing decisions that could 
have a material adverse effect on sales 
results of operations and financial conditions
performance of the itv network
stv broadcasting is our core business and 
as such our fortunes are linked with those 
of the itv network as a whole the 
programming provided by the itv network 
its ability to attract and retain audiences 
and the advertising airtime sales 
performance of itv’s sales house – which  
is responsible for the sale of stv’s uk 
national airtime to advertisers – are factors 
that affect the performance of stv and 
therefore the group as a whole this 
relationship is managed closely with 
regular updates on programme and 
schedule developments being provided via 
itv council on which stv is represented 
and through senior stv staff with 
responsibility to manage the sales 
relationship with itv 
litigation with itv plcitv network
in september 2009 itv plc and other  
itv entities launched a claim against stv 
group plc and subsidiaries for £1520m 
net primarily in relation to optout 
programming stv is both vigorously 
defending this claim and has launched a 
counterclaim under the advertising sales 
agreement in november 2009 stv group 
plc launched an additional claim in relation 
to the exploitation of new media rights  
stv group asserts that despite new media 
rights being acquired and held for the 
benefit of all channel 3 licensees itv 
network limited and itv broadcasting 
limited have entered into commercial 
agreements without obtaining stv group’s 
consent these commercial agreements 
use and exploit new media rights in stv 
central and stv north’s licence areas  
stv is preparing to launch a third claim in 
relation to significant prejudicial behaviour 
by itv network and itv plc against stv 
group plc and its subsidiaries the various 
legal claims result in a maximum potential 
cash outflow of £142m should stv be 
unsuccessful in all claims and a related 
unprovided contingent liability for 
accounting purposes of £69m stv has  
a potential contingent asset of £7 3m which 
has not been recognised in the accounts 
and which will arise in the event that it  
is successful in its defence of itv’s initial 
claim further contingent assets may arise 
under stv’s counterclaim under the 
advertising sales agreement its claim in 
relation to the exploitation of new media 
rights and its potential claim in relation to 
27 alleged prejudicial behaviour by itv  
however  it is not practicable to quantify  
the total potential financial effect of these 
claims and potential claim at this stage 
pension scheme shortfalls 
we believe that the stv pension schemes 
are relatively strong and the investment 
strategy is calculated to reduce any market 
movement impacts however  it is possible 
that the group may be required to increase 
its contributions to cover an increase in  
the cost of funding future pension benefits 
or to cover funding shortfalls which could 
have an adverse impact on results and cash 
flow this position is kept under regular 
review by the board
financial
the overall financial position of stv may 
be constrained by our leverage and other 
debt arrangements an increase in interest 
rates could have an adverse impact on our 
financial position and business results we 
are exposed to a variety of financial risks 
that arise from and apply to our activities 
currency risk credit risk liquidity risk and 
cash flow interest rate risk the group’s 
overall risk management programme 
focuses on the unpredictability of financial 
markets and seeks to minimise potential 
adverse effects on financial performance 
stv uses derivative financial instruments 
to hedge certain risk exposures
risk management is carried out under 
policies approved by the board with 
financial risks being identified evaluated 
and hedged in close cooperation with the 
operating divisions the board provides 
written principles for overall risk 
management as well as written policies 
covering specific areas such as foreign 
exchange risk interest rate risk credit risk 
use of financial instruments and investing 
excess liquidity 
a currency risk
stv operates almost wholly within the uk 
and is exposed to minimal foreign exchange 
risk foreign exchange risk arises primarily 
with respect to the euro us dollar and the 
swiss franc foreign exchange risk arises 
from future commercial transactions and 
trade assets and liabilities in foreign 
currencies
b credit risk
stv has no significant concentration of 
credit risk it has policies in place to ensure 
that sales are made to customers with  
an appropriate credit history derivative 
transaction counterparties are limited to 
highcreditquality financial institutions
c liquidity risk
prudent liquidity management implies 
maintaining sufficient cash and marketable 
securities the availability of funding 
through an adequate amount of committed 
credit facilities and the ability to close out 
market positions due to the nature of the 
underlying business the aim is to maintain 
flexibility in funding by keeping committed 
credit lines available
d cash flow interest rate risk
stv has no significant interest bearing 
assets our income and operating cash 
flows are substantially independent  
of changes in market interest rates
principal risks and uncertainties continued
annual report and accounts 2010
directors’ report – business review  corporate social responsibility
our audience
stv places a great emphasis on the 
importance of our all of our audiences 
from viewers of our onair broadcasts and 
programming to users of our websites and 
followers of our social media presence 
we continue to engage with them and 
always both welcome and encourage their 
feedback on our onair and online content 
for this purpose stv’s dedicated viewer 
enquiries team can be contacted via both 
phone and email and the website features  
a dedicated online comments section  
wwwstvtv is publicised regularly using 
onair announcements ensuring that  
our audiences know how to access online 
content where they can provide feedback 
to us easily and readily 
our marketing department conducted 
focus groups in both the north and central 
regions in 2010 to gain an insight into our 
audience’s thoughts on our brand their 
views on our programming and their  
own viewing habits 
in 2010 we hosted two audience surveys – 
one specifically relating to the new series 
of our flagship drama t aggart in october 
and one just after christmas looking at  
our viewer’s thoughts for 2011 the findings 
of these surveys will go on to inform future 
programming decisions 
stv’s schedule is discussed at regular 
meetings by our commissioning group 
comprising senior staff from across the 
business we have a vigilant compliance 
process and dedicated announcers 
ensuring that all of our programming is 
clearly signposted and that the content is 
clear  enabling audiences to make informed 
decisions about which programmes they 
choose to watch 
digital switchover has already taken place 
in the north which was successful for stv 
and as a trusted media brand we continue 
to work with digital uk to raise awareness 
of the forthcoming switchover in the stv 
central licence area during 2011
our community
stv believes community relations are of 
paramount importance and staff across 
scotland regularly connect with members 
of the public to increase understanding 
about the company and the wider media 
industry  we regularly facilitate studio tours 
at our aberdeen and glasgow studios for 
schools community groups and businesses
stv has developed strong links with 
educational institutions over our 50 years 
in existence shedding light into what many 
regard to be a hugely competitive and 
exciting industry to work in 
edinburgh napier university’s new degree 
programme ba hons t elevision was a key 
industry partner in 2010 and stv offered  
a comprehensive programme of industry 
support including student mentorship work 
placement and shadowing opportunities 
master classes and guest speakers
throughout the year we have facilitated 
tours of the stv studios for a range of 
community groups media students and 
school classes 
we recently offered work placements to 
students across scotland to carry out work 
experience placements on the t aggart set 
with each student spending one week 
working with various departments and 
their second week in an area of their 
choice be that wardrobe make up post 
production direction or script editing
we hosted a skills development day for 
skillset academies in march providing 
opportunities for shadowing industry 
‘master class’ style lectures and workshop 
based learning
stv continued its longrunning partnership 
with youth organisation common purpose 
and their regular educational course ‘y our 
turn’ which aims to encourage leadership 
raise aspirations and increase confidence 
among young people in october  30 
participants visited stv where they met 
with members of the team to learn more 
about news and sports production
the prince’s trust’s ‘get started in 
presenting’ programme designed to help 
young people improve communication skills 
and confidence using the media was a key 
project for stv in 2010 as part of this 
partnership we have organised six visits to 
stv across the year  offering participants a 
greater insight into the work that goes on 
everyone has a contribution  
to make in strengthening  
our relationships with our 
audiences and advertisers
29 corporate social responsibility continued
behind the scenes as well as a chance  
to meet with our newsreaders and learn 
more about the daytoday running of  
a television company 
stv north has an annual placement 
scheme in place with robert gordon 
university where we take one of their 
media students in for a six week period 
the company also offers media studies 
students at aberdeen college week long 
work experience placements on a regular 
basis we also welcome regular visits from 
school parties from throughout the stv 
north transmission area work experience 
placements are also regularly available at 
stv’s studios in inverness and dundee 
in 2010 our weather presenter  sean batty 
conducted educational presentations for 
school pupils on weather  meteorology  
and weather presenting the feedback  
on these experiences is very positive and 
the continued high level of interest from 
schools suggests this is a successful and 
fun method of learning
stv has now installed several weather 
stations at schools in lanarkshire which 
puts us in the early stages of setting up  
our planned stv weather network it is 
expected that this will be rolled out across 
the country in the coming years to enhance 
stv local’s weather content along with  
onair broadcasts
our advertisers
stv continues to offer a wide variety  
of high profile broadcast sponsorship 
campaigns across all daytime peak and  
late night schedule allowing brands to 
feature their brand logo and commercial 
message in an around key programming 
guaranteeing sponsors a prime position 
and maximum visibility across a mass 
viewing audience 
innovative propositions include a range of 
sponsored one minute programmes within 
our schedule which bring commercial 
opportunities as well as allowing lesser 
known minority groups or topics to benefit 
from exposure on a national platform 
in 2010 we broadcast a series of one 
minute programme showcasing the 
nominees and winners of the big hearted 
scots charity awards event which honours 
unsung scots heroes from all walks of life 
who have made extraordinary personal 
sacrifices to help others the event also 
honours personalities from the worlds of 
stage screen sport and business who 
have made a significant contribution 
towards helping others less fortunate  
we also ran a series of one minute 
programmes to coincide with remembrance 
day interviewing veterans young and  
old from a variety of the services the 
interviewees spoke of their experiences 
and challenges after the forces from 
coping with their memories to seeking 
employment and starting a new life with 
the support of friends and family members
our people
the talent capability and commitment  
of our people have been key contributors  
to our ability to respond positively to  
the challenges of the market and deliver 
the progress achieved during 2010 
our culture is based on the core principle  
that everyone in the business can make a 
difference and everyone has a contribution 
to make in strengthening our relationships 
with our audiences and advertisers this 
approach encourages creativity and 
innovation and creates a focus on delivering 
results and achieving our kpis
we have continued to attract key talent 
across all areas of the business and in 
particular through the launch of stv local 
we have recruited staff of the highest calibre 
to form a highly effective and engaged 
team to drive this key growth area
in 2010 we confirmed a number of 
organisational changes to our sales and 
commercial teams to further improve our 
service to our clients and ensure we are in 
the strongest position to maximise revenue 
opportunities across all platforms under 
the direction of peter reilly appointed from 
itv during 2010 the team are in an excellent 
position to build on their successes to date 
and to continue to dominate the scottish 
marketplace with renewed focus
annual report and accounts 2010
directors’ report – business review  at the end of the year we formed the  
stv channels business bringing together 
our broadcasting business and the editorial 
resources of our digital to maximise our 
ability to exploit content across all 
platforms we also confirmed the 
appointment of steven walker  formerly  
of news international to lead the 
development and growth of our online 
classified businesses in 2011 and beyond
engagement
effective communication and engagement 
to secure the involvement of our people in 
delivering our growth targets and creating 
a culture where everyone can make a 
difference remains key to our success
during 2010 we conducted an employee 
opinion survey to assess motivation and 
obtain feedback to identify areas for 
continued improvement to ensure that  
stv continues to be an engaging inspiring 
and rewarding place to work as we will 
undertake a further survey during 2011  
to track progress
we have an open culture based on 
facetoface communication we continue 
to hold quarterly staff briefing sessions at 
which the chief executive officer provides 
an update to our people on business 
performance and strategy and encourages 
involvement and participation in delivering 
our targets and achieving our growth plans 
effective consultation with staff and trade 
unions continues to play an important part 
in delivering organisational change and the 
buyin of our people to our targets and 
business strategy
performance driven culture
during 2010 we have continued to improve 
the alignment of the contribution of our 
people to the goals and kpis of the 
business our talent and performance 
management system mystv provides  
a framework through which we can  
ensure that our people maximise their 
performance and realise their potential 
whilst achieving personal and professional 
growth as the business grows and 
opportunities are presented in new 
business areas and platforms
through mystv performance and 
development goals related to the kpis  
are assigned at an individual level 
additionally the performance and delivery 
of our people is assessed against role 
specific technical competencies and 
behavioural competencies aligned to  
our people strategy 
t alent and capability
as the profile of stv’s brand continues  
to evolve and new business activities are 
developed our ability to attract and retain 
the most innovate and creative talent 
available is key to our success in addition 
to our core staff of 380 we have engaged 
over 550 freelance staff demonstrating 
our role in supporting a vibrant creative 
hub and an emerging digital sector  
in scotland
we have continued to foster closer 
relationships with the higher and further 
education sectors supporting the talent  
of the future we work in close partnership 
with skillset scotland the sector skills body 
for the creative industries 
the recruitment of a high calibre editorial 
team to develop stv local has represented 
the creation of new skilled roles and an 
investment in talent t o ensure that we  
are delivering consistent content of the 
highest quality we have made a significant 
investment in a training programme which 
will be delivered in partnership with the 
national union of journalists
reward and recognition
in line with our competitors across  
the media sector  our reward strategy 
continued to be defined by the challenges 
of the market conditions we continue to 
benchmark our reward and remuneration 
and career structure against a range of uk 
media companies to ensure that we remain 
competitive in this area and the restraint 
applied to our remuneration during 2010 
was consistent with the sector in general
we also review our employee benefits and 
reward structure to ensure this remains 
competitive and we have introduced 
further enhancements to this aimed at 
providing greater choice for our people 
equal opportunities and diversity 
we are committed to maintaining a working 
environment where all employees are 
treated with respect and dignity and their 
full potential can be realised we monitor 
our performance against our policies to 
31 corporate social responsibility continued
ensure that we are engaging effectively 
with our audiences and attracting a diverse 
pool of creative talent applications are 
encouraged from disabled candidates who 
meet the minimum criteria required for any 
vacancy  candidates are requested to make 
us aware of any special arrangements they 
may require in order to participate in the 
selection process on account of a disability 
line manager training is provided to ensure 
that there is equal opportunity for all 
during 2010 no employees became 
disabled during their employment
we have continued our rolling programme 
of management coaching to ensure 
awareness and compliance with equal 
opportunities and our diversity obligations
we were reaccredited with the “disability 
t wo ticks” symbol recognising our 
commitment to the employment retention 
training and career development of 
disabled employees
in december 2010 we committed to 
support the government’s “get ready for 
work” programme providing mentored 
training programmes and for young people 
not in education employment or training
health and safety
stv is committed to compliance with  
all workplace health and safety laws  
and regulations we continue to strive  
to provide a safe and healthy working 
environment we monitor employee  
health and accidents closely and we have 
proactively undertaken health promotion 
programmes designed to reduce health  
risk and enhance employee wellbeing  
we continue our proactive approach to 
improve the company’s management 
documentation systems to provide suitable 
and sufficient information instruction 
training and supervision 
stv has continued to encourage 
participation in elearning via the bbc 
cdrom safety course for our journalists 
and production teams fifty percent of  
our journalists have completed news 
assignment and locations safety training 
with a chartered health and safety 
consultant who specialises in media safety 
training the remaining 50 will complete 
the training during 2011
this year  stv has introduced a programme 
of health and safety induction for new 
members of staff covering fire and 
emergencies office ergonomics first aid 
and other health and safety procedures
stv has a proactive and responsible 
attitude towards occupational road risk 
management with clear procedures in 
place that are reviewed regularly so that 
they remain appropriate and to a high 
standard our clear driving standards and 
rules are communicated to staff through 
stv’s drivers manual and this helps 
maintain our low accident rates
2010 2009 2008
t otal accidents 26 18 30
number attributable  
to driver error 14 11 12
percentage 
attributable to  
driver error 54 61 40
health and safety performance in 2010
stv report workrelated accidents diseases 
and dangerous occurrences in compliance 
with the reporting of injuries diseases  
and dangerous occurrences regulation
1995 “riddor” analysis of the causes  
of accidents provides valuable information 
for implementing improvements if and 
when required in working practices and 
procedures the f acilities manager is the 
designated senior manager responsible  
for health and safety matters riddor 
threeday reportable accidents
2010 2009 2008
riddor threeday 
reportable accidents 1 – –
t otal of all accidents 11 11 6
our environment
stv has an environmental policy in place 
and we actively seek ways to improve  
our performance in this area each year   
we strive to reduce our impacts on the 
environment and recognise that this is 
becoming an increasingly significant part  
of our culture and the way we do business 
annual report and accounts 2010
directors’ report – business review  we recognise that our daytoday  
activities can and do have an effect on  
the environment we are committed to 
continuously improving our environmental 
performance and to reducing pollution
as the scottish government has launched 
its zero waste plan – aiming to increase 
scotland’s recycling to 70 by 2025 – our 
business needs to improve yearonyear  
to help achieve this goal and increase  
our recycling figures 
on average we have recycled approximately 
63 of our waste during 2010
during 2010 we continued to raise staff 
awareness and encourage participation  
in our recycling schemes and will continue 
with this going forward
we participated in ‘green office week’ in 
april during this event stv encouraged 
staff to recycle and conserve energy 
wherever possible 
in 2011 we will remove desk bins around the 
office and encourage staff to recycle more
stv has a green travel plan at our glasgow 
headquarters to encourage staff to use 
more sustainable means of transport to 
commute t o promote cycling we provide 
shower facilities cycle parking and lockers 
for employee use we also manage a car 
sharing initiative where we match up 
employees living in the same area enabling 
them to travel to work together  there are 
currently 40 members of staff taking part 
in this initiative
in 2010 stv joined the prince’s may day 
network this was founded by hrh the 
prince of wales and is a collaboration of 
businesses addressing climate change
we actively monitor our emissions and 
always seek to reduce these in 2010 our 
transport co2 emissions were reduced  
by 145 from the previous year and our 
energy co2 emissions increased slightly by 
52 our travel agent provides us with the 
company’s co2 emissions for all air and rail 
travel our co2 emissions have increased 
from 18837 tonnes in 2009 to 23612 
tonnes in 2010 – an increase of 25 
yearonyear  this is due to international 
travel taken for programming
stv was awarded the ‘bronze’ award from 
the national recycling stars environment 
media group for our efforts in recycling in 
2010 and we hope to repeat or better this 
accolade in 2011 
charitable donations
during 2010 the company made charitable 
donations of £6000 2009 £19000
the company’s policy is not to make 
donations which are of a political nature
rob woodward
chief executive officer
33 annual report and accounts 2010
corporate governance 
board of directors
richard findlay 67
chairman 
3
appointed to the board in february 2007  
richard is the former chief executive of 
scottish radio holdings plc which owned  
a considerable portfolio of newspapers  
and radio stations throughout the uk  
and irish republic and which he ran for  
ten years building it into a major force  
and consistently outperforming peer 
companies in august 2005 scottish radio 
holdings plc was sold to emap plc richard 
has strong links in the scottish arts and 
political establishments he is the founding 
chairman of the national theatre for 
scotland chairman of the royal scottish 
academy of music  drama foundation 
innovate financial services ltd and a 
growing life sciences company 
rob woodward 51
chief executive
appointed to the board in february 2007  
previously rob was commercial director  
of channel 4 t elevision corporation and  
on the main board he was formerly ceo  
of 4ventures and achieved a dramatic 
turnaround of legacy businesses and built  
a set of successful new media and digital 
businesses rob was previously an md of 
ubs warburg and global coo of corporate 
finance in media and communications 
prior to this he was managing partner of 
deloitte’s european t elecoms media and 
t echnology business and uk strategy 
consulting practice
george watt 43
chief financial officer
appointed to the board in february 2001  
as group finance director  george joined 
the company in 1998 as group financial 
controller and treasurer  prior to joining 
stv group plc george worked with kpmg’s 
audit and assurance services practice in the 
uk and also in the us george is a member 
of the institute of chartered accountants in 
scotland and an executive committee 
member of the scottish council for 
development and industry 
david shearer 51
senior independent director 
1 3
appointed to the board in february 2007  
david is an experienced corporate financier 
and was previously senior partner of 
deloitte llp for scotland  northern 
ireland and a uk executive board member 
of deloitte he is deputy chairman of 
aberdeen new dawn investment trust plc 
senior independent director of renold plc 
and superglass holdings plc and a 
nonexecutive director of martin currie 
holdings limited and mithras investment 
t rust plc he was previously chairman of 
crest nicholson plc where he stood down 
after successfully completing the financial 
restructuring of that business was a 
nonexecutive director of scottish financial 
enterprise and a governor of the glasgow 
school of art he served one term ending 
in early 2007 as nonexecutive director  
of hbos plc
vasa babic 44
non executive director 
1 2
appointed to the board in february 2007  
vasa works as an independent advisor  
to large european companies and is a 
nonexecutive director of the hanover 
fund previously he was group director  
of business integration at vodafone plc and 
a partner in the london office of consulting 
firm oliver wyman vasa works in a broad 
range of sectors with a focus on t elecoms 
internet media and t echnology industries 
he has an ma in economics from king’s 
college cambridge
jamie matheson 56
non executive director 
1 2
appointed to the board in march 2007  
jamie is executive chairman of brewin 
dolphin holdings plc a leading private 
client investment manager  he was 
previously a nonexecutive director of 
scottish radio holdings plc until its sale to 
emap plc and is currently a nonexecutive 
director of bluehone aim vct2 plc
matthew peacock 49
non executive director 
3
appointed to the board in february  
2007  matthew is the founding partner of 
hanover investors a specialist turnaround 
investment firm based in london he has 
led investments for over 20 years in 
amongst other sectors manufacturing 
outsourced business services chemicals 
financial services textiles logistics and 
media prior to this he ran the international 
ma team in london at bzw having 
started his career at credit suisse first 
boston in new y ork he holds an llm  
from cambridge university he is currently 
nonexecutive chairman of renold plc 
f airpoint group plc and singer capital 
markets a london stock broking and 
corporate advisory firm he is also 
chairman of regeneris plc
michael jackson 53
non executive director 
2
appointed to the board on 1 may 2009 
michael is an advisor  investor and director 
for digital and television businesses in the 
us and uk previously he was president  
of programming at interactivecorp  
the internet conglomerate where he  
was responsible for overseeing the 
development acquisition and distribution 
of content based websites prior to this 
michael was chairman of universal 
t elevision group in charge of the creative 
and strategic direction of the television 
business he served four years as chief 
executive officer of channel 4 t elevision 
where in addition to commissioning 
programmes he refocused the channel  
to exploit digital opportunities and 
launched two new channels filmfour  
and e4 before joining channel 4 michael 
worked as controller of bbc1 and director 
of t elevision and as controller of bbc2  
he was previously a non executive director 
of emi group plc
key
1 audit committee
2 remuneration committee
3 nomination committee 35
left to right from above
rob woodward
richard findlay
mathew peacock
michael jackson 
george watt
vasa babic
jamie matheson
david shearer annual report and accounts 2010
corporate governance 
corporate governance report
the board is fully committed to achieving and maintaining the highest standards of corporate governance financial reporting and 
business integrity and has structured its activities so as to incorporate the main and supporting principles of the uk’s combined code 
2008 recognising these to be a sound statement of accepted good practice
the directors consider that they complied with all sections of the code for the year under review with the exception of provision a41  
in relation to the constitution of the nomination committee while it is acknowledged that it would be preferable to have this committee 
constituted solely with independent non executive directors there are a limited number of directors to choose from and in the current 
economic climate it is not considered desirable to expend money on enlarging the board merely to ensure we can achieve this however  
the intention is to become compliant over time
this section together with the report by the directors on remuneration set out on pages 44 to 54 describes how in respect to  
the financial year ended 31 december 2010 the company has complied with the principles and provisions of the combined code  
on corporate governance a copy of the combined code is publicly available at wwwfrcorguk
the board and its procedures
the membership of the board throughout the year and up to the date of signing the financial statements was as follows
chairman
richard findlay 
chief executive officer
rob woodward 
chief financial officer
george watt
nonexecutive directors
david shearer senior independent director
matthew peacock 
vasa babic 
jamie matheson 
michael jackson
the board has considered the independence of the nonexecutive directors and has confirmed that while all the directors are considered 
to be of independent character and judgement only richard findlay david shearer  jamie matheson and michael jackson would be 
considered independent as defined by the revised combined code the nonexecutives mix of skills and wide ranging business experience 
is a major contribution to the proper functioning of the board and its committees ensuring that matters are debated and that no 
individual or group dominates the board’s decision making processes nonexecutive directors have a particular responsibility for 
ensuring that the business strategies proposed are fully discussed and critically reviewed and their collective experience and broad range 
of skills gained through a range of industries means they can constructively challenge management in relation to both the development 
of strategy and performance against the goals set by the board 
the board of directors is committed to the highest standards of corporate governance and believes that such standards are vital  
to overall business integrity and performance it recognises that it is accountable to the company’s shareholders for good governance  
to ensure efficient and effective management in order to deliver shareholder value over the longterm
the nonexecutive directors do not participate in any share option or pension scheme of the company 37
attendance of board members at board and committee meetings is set out below
 board audit committee remuneration committee nomination committee
number of meetings held 9 3 2 2 
number attended
richard findlay 9 2
david shearer 9 3 2
rob woodward 9
george watt 9
matthew peacock 8 2
vasa babic 9 3 2
jamie matheson 8 3 2
michael jackson 7 1
nonexecutive directors are appointed for a specified period of three years and reappointment is not automatic directors also stand  
for election by shareholders at the first annual general meeting following their appointment and subsequently every three years  
the report from the nomination committee contained in this report explains the process for selection of directors and succession 
planning copies of the nonexecutives letters of appointment will be available for inspection at the annual general meeting
directors now have a statutory duty to avoid situations where they have or can have any interest that conflicts or possibly may conflict 
with the interests of the company  a director will not be in breach of that duty if the relevant matter has been authorised in accordance 
with the articles of association by the other directors the directors confirm that there have been no such conflicts
there is a well established division of authority and responsibility within the company through the separation of the roles of the 
chairman and the chief executive which is set out in writing and has been approved by the board the chairman is responsible for 
leadership of the board ensuring its effectiveness and setting its agenda he ensures effective communication with shareholders  
and that the board is aware of the views of major shareholders he facilitates the contribution of the nonexecutive directors and 
constructive relations between the executive and nonexecutive directors the chief executive is responsible for the daytoday 
management of the company and executing the strategy once agreed by the board he creates a framework of strategy values 
organisation and objectives to ensure the successful delivery of results and allocates decision making and responsibilities accordingly 
the senior independent director is available to shareholders should they request a meeting or have concerns which they have been 
unable to resolve through normal channels or when such channels would be inappropriate he provides a communication channel 
between the chairman and the non executive directors and is responsible for leading the board’s discussion on the chairman’s 
performance at the annual performance review
directors and officers of the company and its subsidiaries have the benefit of a directors’ and officers’ liability insurance policy  
the company’s articles of association also provide that every director and other officer of the company is to be indemnified out of the 
assets of the company against any liability he incurs in defending any proceedings brought against him provided that judgement is not 
given against him all directors have access to the advice and service of the company secretary and at the company’s expense the 
group’s legal advisers the company secretary is an employee of the company and attends all meetings of the board and its committees 
she is responsible for ensuring that all board procedures are observed and for advising the board on corporate governance matters
the board meets regularly at least nine times a year with additional meetings taking place as and when required the board has adopted 
a schedule of matters reserved for its decision the principal matters being approval of
•
 
financial statements and shareholder circulars dividend policy significant changes in accounting policies or practices
•
 
board and committee appointments and terms of reference terms and conditions of nonexecutive and executive directors
•
 
the group’s longterm objectives and commercial strategy annual operating and capital expenditure budgets annual report and accounts 2010
corporate governance 
•
 
material contracts and significant variations in terms of the group’s borrowing facilities
•
 
corporate activity which is subject to the city code on t akeovers and mergers or of a material nature
•
 
major changes to the group’s pension schemes share schemes and treasury policy
•
 
 internal control and corporate governance arrangements and to act as a court of last resort in relation to any investigations 
undertaken by the audit committee
the board sets the strategic objectives of the company determines investment policies agrees on performance criteria and delegates  
to management the detailed planning and implementation of those objectives and policies in accordance with appropriate risk 
parameters compliance with policies and achievement against objectives is monitored by the board through monthly and quarterly 
performance reporting and budget updates
board meetings involve reviews of financial and business performance against the plan and budgets approved by the board both at  
a company and a divisional level the board also receives regular presentations from key areas enabling it to explore specific issues  
and developments in more detail any matter requiring a decision by the board is supported by a paper analysing all relevant aspects  
of the proposal including potential risks and proposed management action
each year a strategy day is held offsite which is attended by the board and the leadership t eam the leadership t eam has been 
restructured during 2010 to reflect the growth and changing priorities of the business this comprises the executive directors  
chief operating officer commercial director director of corporate development chief t echnology and platforms officer director  
of channels deputy director of channels director of content and hr and communications director  the purpose of the team is  
to drive the implementation of the company’s strategic priorities whiles addressing critical business issues and opportunities the team 
meets weekly and is focused on groupwide performance with the emphasis on collaboration and teamwork and ensures that there are 
clear lines of accountability  at the strategy day each member of the leadership t eam presents on the future plans and opportunities  
for their respective area of the business and in addition to building consensus on the direction the company is taking this allows all 
comments to be taken on board and gives the non executive directors the opportunity to question the leadership t eam the strategy 
day is an important tool in communicating goals and objectives so that the most effective use can be made of stv’s resources by 
focusing on the key priorities it provides a clear focus for the company thereby producing more efficiency and effectiveness
when a director is unable to attend a board or committee meeting he receives the papers for consideration at that meeting and  
has the opportunity to discuss any issues or make any comments in advance and if necessary follow up with the chairman of the 
relevant meeting
performance evaluation
the effectiveness of the board is vital to the success of the group and accordingly the company undertakes a rigorous evaluation each 
year in order to assess how well the board its committees the directors and the chairman are performing in addition the process aims 
to improve effectiveness for the future and provide an opportunity for the non executive directors  through their exposure on other 
company boards  to draw on their experience and to suggest areas of best practice it is also an opportunity for directors to raise any 
concerns about procedures and governance issues as in previous years this is an internal exercise led by the chairman
the evaluation is conducted using a comprehensive questionnaire which canvasses the opinions of the directors on a wide range of 
matters including board composition board meetings and processes board performance the performance of individual directors as  
well as the board’s communication both with external stakeholders and the company’s senior management the performance evaluation 
questionnaire is followed by meetings of the full board the chairman with the nonexecutive directors and nonexecutive directors only 
the chairman’s evaluation is managed by the senior independent director who provides feedback to the chairman as part of the 
chairman’s evaluation the nonexecutive directors meet separately under the chairmanship of the senior independent director  
corporate governance report continued 39
on completion of the evaluation process the directors have concluded that the board is effective in meeting its objectives and fulfilling  
its duties and obligations additionally the chairman has concluded that each director contributes effectively and demonstrates full 
commitment to his duties and as such no changes or amendments were judged necessary  
the 2010 performance evaluation found the performance of each director to be effective and concluded that there was a strong  
cohesive board which provided the effective leadership and control required for a listed company
the chairman and other members of the board recommend that the directors retiring be reelected the chairman has confirmed that  
all directors retiring and seeking reelection have been subject to performance evaluation and as part of this evaluation the chairman 
confirms that they continue to demonstrate commitment to their role and in his view continue to fulfil their functions responsibly  
the other members of the board have evaluated the performance of the chairman and recommend his reappointment
board committees
the audit remuneration and nomination committees each held an evaluation of their work and effectiveness during the year  the results 
of which were reported to the board by the respective committee chairmen the reviews concluded that each committee was operating 
in an effective manner and carrying out their respective delegated duties efficiently  
the board and its committees will continue to review critically their procedures effectiveness and development throughout the year 
ahead with any concerns or observations raised with the chairman
the board is supported by the nomination remuneration and audit committees reports from the nomination and audit committees 
are contained within this report on pages 39 to 41
remuneration committee
the members of the committee during the year were
vasa babic chairman
jamie matheson
michael jackson 
the activities of the remuneration committee are described within the report by the directors on remuneration which can be found  
on pages 44 to 54
the terms of reference of the remuneration committee are available on request and on the company’s website wwwstvplctv
report from the nomination committee
the members of the committee during the year were
matthew peacock chairman
richard findlay
david shearer annual report and accounts 2010
corporate governance 
the nomination committee has written terms of reference its principal duties are to
•
 
regularly review the structure size and composition of the board and evaluate the balance of skills knowledge and experience
•
 
regularly review plans for succession of executive and nonexecutive directors and make recommendations to the board
•
  
identify and nominate candidates for approval of the board using if appropriate external recruitment and search advisers employing 
objective and industryrecognised selection criteria
•
 
 recommend to the board membership of the audit and remuneration committees in consultation with the chairmen of  
those committees
the full terms of reference of the committee are available on request and on the company’s website wwwstvplctv
there is a formal and transparent procedure for the appointment of new directors to the board as part of the annual performance 
evaluation conducted by the board a review is conducted of the board’s size composition diversity and balance of skills the outcome  
of the review is used by the committee to determine the selection criteria and role specification of nonexecutive directors external 
selection consultants may be retained to conduct searches and a shortlist created in consultation with the committee and where 
appropriate the executive directors the committee reviews the profiles of candidates and conducts interviews prior to making 
recommendations to the board for approval appointments are made on merit and against objective criteria
all directors are given a comprehensive introduction to the group’s various businesses and continuing development is provided through 
briefing sessions in the course of regular board meetings covering business specific and broader regulatory issues and including 
presentations from members of senior management
report from the audit committee
the members of the committee during the year were
david shearer chairman
vasa babic
jamie matheson
the audit committee chaired by david shearer  who has recent and relevant financial experience is authorised by the board to 
investigate any activity within its terms of reference and to seek any information it requires from any employee all employees are 
directed to cooperate with any request made by the committee
amongst others the duties of the committee are to
•
  
monitor the integrity of the company’s published financial statements ensuring that they meet statutory and associated legal and 
regulatory requirements and review significant financial reporting judgements contained in them
•
  
review the effectiveness of the company’s internal financial controls and audit arrangements and investigate and advise on these  
or related matters which are referred to it or that it considers necessary 
•
 
review the company’s statement on internal control systems prior to endorsement by the board
•
 
consider the major findings of any internal investigations on control and management’s response
•
  
discuss with the company’s auditors matters arising from their work in the absence of management where necessary and  
encourage and monitor compliance with relevant codes of best practice in corporate governance
•
  
keep under review the scope and results of the annual audit its costeffectiveness and the independence and objectivity  
of the auditors
•
  
consider the appointment of the external auditors the audit fee their independence and objectivity and any matters relating  
to the resignation or dismissal of the external auditors
•
  
review the company’s arrangements for its employees to raise concerns in confidence about possible wrongdoing in financial 
reporting or other matters
•
 
review the operation of the risk management process
• review the scope of work and reports produced by the internal auditors
the full terms of reference of the committee are available on request and on the company’s website wwwstvplctv 
corporate governance report continued 41
meetings of the committee are normally attended by the chief executive officer  chief financial officer as well as the group financial 
controller and representatives of both the external auditors and the internal auditors the committee also meets separately with senior 
management and the external auditors
the chairman of the audit committee reports to the subsequent meeting of the board on the committee’s work and the board receives  
a copy of the minutes of each meeting the papers considered by the committee are available to any director who is not a member  
should they wish to receive them the committee’s effectiveness is reviewed annually as part of the board evaluation process in 2010  
the board concluded that it continues to operate effectively 
the audit committee and board place great emphasis on the objectivity of the group’s auditors pricewaterhousecoopers llp in their 
reporting the audit partner and manager attend audit committee meetings to ensure full communication of matters relating to the  
audit the auditors have confirmed to the committee that in relation to their services to the company they comply with uk regulatory and 
professional requirements including ethical standards issued by the auditing practices board and that their objectivity is not compromised
the audit committee is responsible for approving non audit work and during the year under review this consisted mainly of advice  
in relation to tax and the disposal of pearl  dean while it is important that the independent role of external auditors in reporting to 
shareholders is not compromised it is equally important that the company is not deprived of expertise when and where it is needed
there are a number of projects and engagements where the external auditors are best placed to perform the work due to their  
network within or to previous experience market leadership in a particular area or their knowledge of the company accordingly in  
such circumstances it is more timely and cost effective to select pwc and it has carried out or supported a number of projects for  
stv over the years the committee believes that this is in the best interests of shareholders and that the independence and objectivity  
of the auditors is not impaired it should also be noted that pwc is subject to professional standards which safeguard the integrity of  
the auditing role performed on behalf of shareholders
however  in order to ensure that due consideration is given to the award of any nonaudit work the chief financial officer must obtain  
the approval of either the chairman of the audit committee or another committee member if the preference is to use the auditors and 
must provide an explanation as to why the auditor is the preferred option a case by case decision is therefore necessary and the auditor 
cannot be engaged for nonaudit work without reference to the audit committee it is felt that this process ensures shareholders receive 
value for money 
during the year the committee reviewed the company’s interim and full year results prior to publication as well as its risk management 
procedures and risk register  incorporating relevant social ethical and environmental risks in 2009 deloitte was appointed as the group’s 
internal auditor and the board considers this appointment to be in support of the principles of good corporate governance and that this 
function will enhance the current internal controls processes which includes a full time compliance manager  
the primary focus of deloitte’s comprehensive internal audit programme is to provide assurance over key revenue streams and operating 
costs over the course of the three year programme deloitte will review systems and processes and will ensure that the company is 
operating effectively efficiently and economically and in accordance with legislative requirements and professional standards its work  
is designed to provide insights into the internal control environment and efficiencies of key processes as well as providing feedback on  
the effectiveness of interfaces between the business and enabling functions
deloitte attend all meetings of the audit committee and prepare a paper which they present at each meeting the first meeting paper  
sets out the internal audit plan for that year with subsequent meeting papers taking the form of a “status update” reporting on what 
specific areas have been reviewed an overall evaluation of the current controls and the key findings and recommendations
the board reviews the internal control process and its effectiveness on an ongoing basis to ensure it remains robust and to identify  
any control weaknesses and can confirm that no significant failings or weaknesses were identified in relation to the review
pricewaterhousecoopers llp have been the company’s auditors since 2004 the committee is satisfied with their effectiveness and 
independence and has not considered it necessary to require an independent tender process the external auditors are required to rotate 
the audit partner responsible for the group and subsidiary audits every five years and the current lead audit partner has been in place  
for two years there are no contractual obligations restricting the company’s choice of external auditor  
a resolution to reappoint the auditors will be put before shareholders at the annual general meeting annual report and accounts 2010
corporate governance 
risk management and internal control
the directors of the company have overall responsibility for establishing and maintaining an adequate system of internal controls and for 
reviewing the effectiveness of the system the system of internal control is designed to manage rather than eliminate risk and in pursuing 
these objectives internal control can only provide reasonable and not absolute assurance against material misstatement or loss
in addition to both the external and the internal audit the following key controls are in place
•
 
 a comprehensive financial review cycle which includes a detailed budgeting process where business units prepare budgets for approval 
by the board monthly reporting of trading results for review and where necessary corrective action as well as detailed and regular 
reforecasting
•
  
clearly defined management structure and delegation of authority to committees of the board subsidiary boards and associated 
business units 
•
 
high recruitment standards and formal career development and training to ensure the integrity and competence of staff 
•
 
regular reviews of key performance indicators and business risks and consequent steps to manage any matters arising
•
 
procedures for the approval of capital expenditure 
•
  
monthly monitoring and reforecasting of results against budget with major variances followed up and management action taken 
where appropriate 
•
  
ongoing procedures to identify evaluate and manage significant risks faced by the business in accordance with the guidance of the 
turnbull committee on internal controls and procedures to monitor the control systems in place to reduce these risks to an acceptable 
level and 
•
 
 provision to the board and management of relevant accurate and timely information based on comprehensive management 
information systems which are continually being improved and updated
the company has in place a whistleblowing policy through which staff can in confidence raise concerns about possible improprieties 
either in the conduct of others in the business or in the way the business is run concerns can relate to actual or potential breaches of law 
or company policy including those relating to accounting risk issues internal controls auditing issues and related matters all matters 
raised will be investigated and reported to the committee no such concerns were raised by staff during the year 
risk is inherent in the group’s business and activities and the review of risk and risk management is embedded throughout the group 
the ability to identify assess monitor and manage each type of risk to which the group is exposed is an important factor in its financial 
soundness performance reputation and future success the management of risk is considered to be of vital importance and as such  
it is a matter for the full board and not delegated to a committee accordingly all directors are responsible for the framework of risk 
governance and management and for determining risk strategy and ensuring that it is monitored and controlled effectively this is 
communicated to the leadership t eam and each member is accountable for all risks assumed in their respective areas of responsibility 
and for the execution of appropriate risk management discipline 
the group’s risk management system is subject to regular review to ensure full compliance with the requirements of the combined code 
and the t urnbull guidance on internal control and risk management and is designed to manage rather than eliminate the risk of failure  
to achieve business objectives 
key elements of the company’s system of risk management include
•
 
group statements on strategic direction ethics and values
•
 
clear business objectives and business principles
•
 
linking identified risks to key business objectives and divisional kpis 
•
 
a continuing process to identify and evaluate significant risks to the achievement of business objectives
•
 
management processes to mitigate significant risks to an acceptable level
•
 
constant monitoring of significant risks and internal and external environmental factors that may change the group’s risk profile 
a highly detailed review process conducted on a multilevel basis ensures that the consolidated group accounts are prepared having 
taken account of the internal control procedures and risk management strategies outlined above
corporate governance report continued 43
the comprehensive risk register comprises risks specific to the divisional activities of the business as well as environmental social 
governance financial and human resources risks it is a constantly evolving document which is reviewed and updated on an ongoing basis 
at an operational level and on a quarterly basis by the board with the audit committee conducting an annual review this regular review 
is vital to ensure that a risk culture is embedded throughout the group and that an appropriate risk framework is operating effectively  
it also provides the board and the audit committee with an overall view of the group’s risk profile identifying any major exposures and 
mitigating actions
the risk management process includes multiple opportunities for rigorous discussion and debate to assess the relative profile of each  
risk to the other  risks are linked to business objectives and kpis to ensure that all key risks are considered and adequately managed 
each risk is scored on both an inherent gross basis and residual net basis to provide assurance that the controls are operating as 
intended and both the inherent and residual scores are calculated by multiplying the risk likelihood by the risk impact to ensure that  
more accurate evaluations are taken
the risk management framework and internal controls system across the group which is subject to continuous development  
provides the basis on which the company has complied with the combined code provisions on internal control
relationship with shareholders
the board recognises the importance of twoway communication with the company’s shareholders ensuring that all directors are fully 
aware of their views as well as giving a balanced report of results and progress at each annual general meeting the company meets 
with and responds to questions and issues raised by institutional and retail shareholders 
the chairman the senior independent director and other nonexecutive directors are available to meet with major shareholders to 
discuss governance and strategy and to understand any issues and concerns communication with major shareholders analysts and  
the financial press is maintained throughout the year and feedback from major shareholders is regularly sought and reviewed by the 
board copies of analysts’ research relating to the group are circulated to all directors upon publication and a brief analysis of the 
shareholder register is prepared quarterly and made available to the board 
detailed reviews of the company’s performance and financial position are included in the chairman’s statement the chief executive 
officer’s and chief financial officer’s reviews which the board uses to present a balanced and understandable assessment of the 
company’s position and prospects such communication is designed to establish a mutual understanding of objectives 
stv’s corporate website at wwwstvplctv has information for institutional and retail shareholders alike and shareholders seeking 
information may contact the company directly throughout the year  in addition stv has an electronic communication facility to allow 
shareholders to receive information more quickly and in a manner more convenient for them the board also welcomes and encourages 
the participation of all shareholders at the company’s annual general meeting
the company’s registrar  capita operates an internet access facility for shareholders providing details of their shareholding  
at wwwcapitashareportalcom  annual report and accounts 2010
corporate governance 
remuneration report
remuneration committee report
introduction 
this report has been prepared in accordance with schedule 8 quoted companies directors’ remuneration report regulations 2008  
the “regulations” the report also meets the relevant requirements of the listing rules of the financial services authority and 
describes how the board has applied the principles and complied with the provisions of the uk’s combined code 2008 relating to 
directors’ remuneration as required by the regulations an advisory resolution to approve the report will be proposed at the agm of  
the company at which the financial statements will be approved 
the auditors are required to report on the ‘auditable’ part of this report and to state whether  in their opinion that part of the report has 
been properly prepared in accordance with the companies act 2006 as amended by the regulations the report is therefore divided 
into separate sections for audited and unaudited information 
part 2 of the regulations – unaudited information 
remuneration committee 
the directors who were members of the remuneration committee during the year are shown on page 39 in the section  
on corporate governance 
the responsibility for the establishment of a remuneration policy and its cost is a matter for the full board on the advice of the 
remuneration committee the recommendations of the remuneration committee have been approved without amendment by  
the board for submission to shareholders 
the remuneration committee is responsible for developing policy on remuneration for executive directors and senior management  
and for determining specific remuneration packages for each of the executive directors the remuneration committee members have  
no personal financial interest other than as shareholders in matters to be decided no potential conflicts of interests arising from cross 
directorships and no daytoday involvement in running the business 
during the period under review the remuneration committee sought the assistance of the chairman and chief executive officer  
on matters relating to directors’ performance and remuneration the chairman chief executive officer and the human resources 
director attend meetings by invitation except when their individual remuneration arrangements are discussed no director takes part in 
discussions relating to their own remuneration and benefits the remuneration committee appointed and received wholly independent 
advice on executive compensation and associated share scheme administration from pwc human resource services
the remuneration committee is formally constituted with written terms of reference with the full remit of the committee role described 
a copy of the terms of reference is available to shareholders on request by writing to the company secretary whose contact details are 
set out on page 101 of the annual report and on the company’s website wwwstvplctv  
philosophy behind remuneration committee’s approach
the policy is designed to encourage reward and retain the executives and the remuneration committee believes that shareholders’ 
interests are best served by remuneration packages which have a large emphasis on performancerelated pay emphasis on performance 
should encourage executives to focus on delivering the business strategy and by providing meaningful incentives to executives ensure 
that the appropriate balance between fixed and performancerelated pay is maintained
remuneration policy 2010
the company’s remuneration policy approved by shareholders at the extraordinary general meeting in june 2007 is based on  
the following principles to ensure that it is inherently linked to the strategic objectives targets and key performance indicators of  
the business
•  to maintain a competitive package of total compensation commensurate with comparable packages available within other similar 
companies operating in similar sectors
•  to make a significant percentage of potential maximum reward conditional on longterm performance
•  to ensure that the interests of executives are closely aligned with those of the company’s shareholders through the provision  
of equity incentives
•  to link reward to the satisfaction of the targeted objectives which are the main drivers of shareholder value 
• to be sensitive in determining executives’ remuneration relative to the current economic climate  45
remuneration of executives is linked to a range of business performance measures relating to strategic objectives operational targets 
and performance against the company’s 11 kpi targets progress and performance against these measures is reviewed on a periodic basis 
by the remuneration committee this process ensures that when determining executive remuneration the committee takes into account 
the risk profile of the company and its longterm sustainability 
 
the company’s 11 kpis are detailed on pages 22 and 23 of the annual report
 
every year  the remuneration committee reviews whether the remuneration policy remains appropriate for the relevant financial year  
f actors taken into account by the remuneration committee include
• market conditions affecting the company
• the recruitment market in the company’s sector
• changing market practice
• changing views of institutional shareholders and their representative bodies
•  pay and conditions throughout the company  the remuneration committee has access to information on the pay and conditions of 
other employees in the group when determining the remuneration packages for executive directors the remuneration committee 
actively considers the relationship between general changes to employees pay and conditions and any proposed changes in the 
remuneration packages for executive directors to ensure it can be sufficiently robust in its determinations in light of the position  
of the company as a whole
components of executive directors’ remuneration
the individual components of the remuneration package for 2010 are outlined below
base salary
the base salary is reviewed annually by the committee when determining the salary of the executives the committee takes  
into consideration
•  the levels of base salary for similar positions with comparable status responsibility and skills in organisations of broadly similar  
size and complexity in particular the median salary levels of those comparable companies within the media sector and the  
comparator group
• the performance of the individual executive director 
• the individual executive director’s experience and responsibilities 
• pay and conditions throughout the company 
in january 2010 base salary was reinstated to previous levels following the implementation of voluntary reductions during 2009  
in response to market conditions base salary levels have not been adjusted since 2007 and the committee has agreed that they  
will remain at current levels in 2011
benefits allowance
executives are entitled to receive a taxable cash allowance in lieu of benefits in kind including car and private medial insurance  
the company actively reviews the levels of benefit received to ensure that they remain market competitive this cash benefits  
allowance is excluded from the calculation of any other benefit provided by the company
performance related bonus plan
the targets for the annual bonus plan are reviewed and agreed by the remuneration committee at the beginning of each financial  
year to ensure that they are appropriate to the current market conditions and position of the company in order to ensure that they 
continue to remain challenging bonus payments are not pensionable 
a performance related bonus plan was operated in 2010 bonus payments are not guaranteed and are dependent on achievement  
of performance targets relating to financial and personal performance measures
the 2010 performance related bonus plan was designed to annual report and accounts 2010
corporate governance 
•  ensure a link between achievement of key performance indicators of the business and key financial performance targets whilst 
encouraging a longer term performance focus through a deferred reward component in shares
• support executives in building up a shareholding in the business through rewards made in both cash and shares
•  ensure that in recognition of the absence of a longterm equity based award in 2010 that there is an appropriate balance between 
shortterm cash based rewards and midlonger term equity based rewards
bonus payments have been triggered in 2010 as a result of strong financial performance delivered against the financial performance 
targets relating to the bonus plan all of which have been met in full as a result bonus payments at 75 of bonus potential maximum 
have been earned the bonus performance measures and the extent to which these have been satisfied is outlined below
2010 performance related bonus plan
performance targets  t arget satisfied bonus payable
group pbt 175 25 max
eps 189 25 max
operating profit 120 25 max
personal objectives executive directors voluntarily 
agreed to waive entitlement  
to this element
0 by voluntary agreement
in recognition of the need for continued restraint in remuneration at the present time the chief executive officer volunteered and 
subsequently has agreed with the committee and the board that he will not receive any payment of bonus earned in 2010 and that this 
will be deferred for a period of 24 months and will be payable wholly in shares and partially subject to performance conditions being met
under the rules of the performance related bonus plan payments are due to be made in three tranches with release of the third tranche 
conditional upon further financial performance targets relating to 2011 performance being achieved the first tranche payable in march 
2011 is payable in cash the second tranche payable in march 2012 is payable in shares release of the third tranche will be conditional 
upon achievement of financial performance targets relating to 2011 performance payment will be conditional upon 2011 group pbt and 
eps being 10 in excess of 2010 actual performance subject to this being achieved payment will be made in march 2013 in shares
the committee has agreed that the 2011 performance related bonus plan will remain based on financial performance targets relating to 
group pbt operating profit and eps bonus potential maximum payments will be a maximum of 125 of base salary 2010 150 and 
25 of bonus payments will become payable upon achievement of performance target 2010 40 with bonus potential maximum 
being payable upon performance targets being exceeded by 25 2010 20 a straight line mechanism will operate between 100  
and 125 of budgeted financial performance targets
share incentives
no share based incentive awards were granted in 2010
the remuneration committee does not intend to award an l tip in 2011 
dilution
the company operates all of its share arrangements within the abi guidelines on dilution the abi guidelines provide that the company 
can issue a maximum of 10 of its issued share capital in a rolling tenyear period to employees under all its share plans in addition  
of this 10 the company can only issue 5 to satisfy awards under discretionary or executive plans
remuneration report continued 47
the following table sets out the current level of dilution against the abi limits for all share plans and discretionary plans principally 
executive plans and sets out the commitments to issue shares made during the financial year reported
maximum current dilution additional dilution during the year in question
10 dilution in ten years 373 002
5 dilution in ten years 373 002
pension
the group operates a defined benefits scheme closed to new members a defined contribution scheme and executives have the option 
to receive a taxable cash allowance in lieu of pension benefits
subject to inland revenue limits the scheme provides members with a pension of two thirds of final basic salary upon reaching normal 
retirement at age 65 the principal features of the pension benefit accrued are noted below these are 
• the annual accrued pension payable from normal retirement age calculated as if he had left service at the period end 
• the increase in the accrued pension attributable to service as a director during the year 
• the transfer value of the accrued benefit at the end of the period calculated in accordance with the actuarial guidance note gn11 
•  the transfer value of the accrued benefit at the end of the previous period calculated in accordance with the actuarial guidance  
note gn11 
• the increase in the transfer value over the period net of employee contributions 
rob woodward is not a member of any company pension scheme and receives a taxable cash allowance george watt was a participating 
member of the scottish and grampian t elevision retirement benefits scheme which is an inland revenue approved defined benefit 
occupational pension scheme until 31 march 2010 when he decided to become a deferred member of the scheme from 1 april 2010 to  
31 december 2010 george watt received a taxable cash allowance in lieu of pension contributions
fixed and variable compensation
the chart below demonstrates the balance between fixed and variable performancebased compensation for each executive director  
for the year ended 31 december 2010
r woodward   g watt
key
fixed compensation is calculated as – salary – benefits
performance compensation is calculated as – bonus available
55 performance compensation
45 fixed compensation
55 performance compensation
45 fixed compensation annual report and accounts 2010
corporate governance 
directors interests in shares
the beneficial interests of the directors and their families in the ordinary shares of the company as of 1 january 2010 and as at  
31 december 2010 were other than in respect of options or other rights to acquire ordinary shares as follows
1 january 2010 31 december 2010 
ordinary  
shares
share  
incentive  
plan
ordinary  
shares
share  
incentive  
plan
executive directors
rob woodward 30000  177 097 –
george watt 17 634 1070 102349 1070
nonexecutive directors
richard findlay 15000  15000 –
david shearer 12500  40000 –
jamie matheson 12500  12500 –
vasa babic 3803825  2154496 –
matthew peacock 3803825  2154496 –
michael jackson   – –
 these 2154496 stv group plc shares are held by hanover  the interests of both matthew peacock and vasa babic are by reference to 
the same shareholding
executive directors’ contracts 
details of the service contracts of the executive directors of the company are as follows 
name
company  
notice period contract date
unexpired  
term of contract
potential  
termination payment
rob woodward 
chief executive officer 12 months 280207 rolling contract
12 months salary  
and benefits
george watt 
chief financial officer 12 months 27 0201 rolling contract
12 months salary  
and benefits
all executive directors’ contracts are for a fixed period of one year from date of appointment and will continue thereafter unless 
terminated by at least 12 months’ written notice this arrangement is in line with best corporate practice for listed companies in the event 
of the termination of an executive’s contract salary and benefits will be payable during the notice period there will however  be no 
automatic entitlement to bonus payments or share incentive grants during the period of notice other than where normal good leaver 
provisions apply all executive directors will be expected to mitigate their loss in accordance with general legal principles in the event of 
their cessation of employment the remuneration committee will ensure that there have been no unjustified payments for failure on an 
executive director’s termination of employment there are no special provisions in the contracts of employment extending notice periods 
on a change of control liquidation of the company or cessation of employment 
remuneration report continued 49
nonexecutive directors 
the remuneration of the nonexecutive directors is determined by the board based upon recommendations from the chairman and  
chief executive officer or  in the case of the chairman based on recommendations from the senior independent nonexecutive director 
and the chief executive officer and is within the limits set by the articles of association for nonexecutive directors the basic fee is paid 
only in cash nonexecutive directors do not participate in any bonus plan or share incentive programme operated by the company and 
are not entitled to pension contributions or other benefits provided by the company the nonexecutive directors do not have service 
contracts but their appointments are for fixedterms of three years subject to the terms of the company’s articles of association the 
companies act and shareholder approval the basis of fees paid to the nonexecutive directors is as follows
• a basic fee of £30000 for carrying out the duties of a nonexecutive director
• a basic fee of £40000 for carrying out the duties of senior independent nonexecutive director
• a fee of £5000 for carrying out the specific duties of sitting on the company’s audit and or 
• remuneration committees
•  an additional fee of £2500 on top of the committee fee to reflect the additional duties involved in chairing that committee
there will be no changes to the fees paid to the nonexecutive directors in 2011
t otal shareholder return performance graph
the graph shows the company’s performance measured by total shareholder return “tsr” compared to the constituents of the  
ftse media index over the last five years
dec 05 jun 06 dec 06 jun 07 dec 07 jun 08 dec 08 jun 09 dec 09 jun 10 dec 10
20
40
60
80
100
120
stv group plc
ftse small cap media index annual report and accounts 2010
corporate governance 
2010 audited information 
the total of directors’ emoluments in the year was £1097 000 2009 £909000 
the remuneration of each director  excluding longterm incentive awards during the year ended 31 december 2010 compared with 2009 
is set out in the table below 
basic salaryfees benefits 1
annual performance 
related bonus 2
compensation  
for loss of office total
2010  
£000
2009  
£000
2010  
£000
2009  
£000
2010 
 £000
2009  
£000
2010  
£000
2009  
£000
2010  
£000
2009 
£000
executive directors
rob woodward 380 329 92 89 – – – – 472 418
george watt 214 193 52 32 80 – – – 346 225
   
nonexecutive directors
richard findlay 85 85 – – – – – – 85 85
david shearer 48 48 – – – – – – 48 48
matthew peacock 38 38 – – – – – – 38 38
vasa babic 38 38 – – – – – – 38 38
jamie matheson 35 35 – – – – – – 35 35
michael jackson 35 22 – – – – – – 35 22
t otal £000 873 788 144 121 80 0 0 1097 909
1  this is an allowance to cover standard company benefits such as a car and medical insurance in addition this includes a taxable cash 
allowance in lieu of a pension contribution see pension section below for more information
2  under the terms of the 2010 bonus plan bonus is payable in three equal tranches with performance conditions attached to the final 
tranche the first tranche is payable in cash in 2011 the second tranche is payable in shares in 2012 and the final tranche is payable in 
shares in 2013 subject to the fulfilment of performance conditions relating to 2011 financial performance the chief executive officer 
has agreed with the board that he will not receive any payment of bonus earned in respect of 2010 and that this will be deferred for 
up to 24 months and paid wholly in shares with financial performance conditions relating to future financial performance applying  
to two thirds of his bonus payment 
2010 performance related bonus plan share elements
name date of grant
number of  
bonus shares  
granted in respect  
of 2010 share price vesting date
rob woodward
310311 114919 £124 310312
310311 229838 £124 310313
george watt
310311 64516 £124 310312
310311 64516 £124 310313
 vesting subject to satisfaction of 2011 performance condition see unaudited section of the report
remuneration report continued 51
pension entitlements
for further information on pensions refer to the unaudited part of the remuneration report
rob woodward is not a member of any company pension scheme and receives a taxable cash allowance of £7 6000 equivalent to 20 
of base salary 2009 £76000 20 of base salary 
george watt was a participating member of the scottish and grampian t elevision retirement benefits scheme until 31 march 2010 for 
the period of his participation in the scheme george watt made contributions of 10 of base salary up to the earnings cap 2009 9 
from 1 january 2009 until 31 july 2009 and 10 thereafter a cash pension allowance of £32130 2009 nil was paid to george watt  
in respect of the period from 1 april 2010 to 31 december 2010 following his voluntary cessation of his membership of the final salary 
pension scheme
final salary scheme 
 
change in  
accrued  
pension over  
the year 1  
£
accrued  
pension at  
31 december  
2010 
£
t ransfer  
value at  
31 december  
2010 2  
£
t ransfer  
value to  
31 december  
2009  
£
change in 
 transfer value  
over the year  
less director’s 
contributions  
£
george watt 1395 25995 266570 243692 19788
1 pension accruals shown are the amounts that would be paid annually on retirement based on service at the end of the current year  
2  transfer values have been calculated in accordance with guidance note gn11 issued by the faculty and institute of actuaries  
the transfer values represent the actuarial liability of the pension plan and not the sum paid or due to an individual 
directors’ interests in the company’s share plans 
long t erm incentive plan
this plan is operated under the rules of the l tip arrangement approved by shareholders on 3 june 2005 the following awards were 
granted under the company’s longterm incentive plans
2007 long t erm incentive plan
the award was approved by shareholders on 3 june 2007  the award was granted on 12 july 2007 and lapsed on 12 july 2010
interests  
at 1 january 2010
awarded  
in year
released  
in year
lapsed  
in year
31 december  
2010
award  
date
release  
date
rob woodward 122998   122998  1207 07 1207 10
george watt 46178   46178  1207 07 1207 10
2005 long t erm incentive plan
this plan is operated under the rules of the l tip arrangement approved by shareholders on 3 june 2005 the award was granted on  
11 april 2008
interests  
at 1 january 2010
released  
in year
lapsed  
in year
31 december  
2010
award  
date
release  
date
rob woodward 365452   365452 110408 110411
george watt 206000   206000 110408 110411 annual report and accounts 2010
corporate governance 
performance conditions 
2008 award
50 of the award is subject to comparative tsr performance against a competitor and comparator group 50 of the award is subject 
to the average annual roce performance of the company 
competitor tsr group
average annual  
roce performance
position
  
of award
quartile   
of award
group  
roce
  
of award
position 5 0 median 0 10 10
position 4 25 median 25 50 50
position 3 50 upper quartile 100 20 100
position 2 75
position 1 100
straight line release between these points
competitor group
b sky b plc chrysalis plc emap plc itv plc maiden group plc ulster t elevision plc
comparator group
aegis group plc british sky broadcasting plc chrysalis plc emap plc euromoney institutional investor plc future network plc  
ite group plc itv plc johnston press plc maiden group plc photome international plc st ives plc tf informa plc  
t aylor nelson sofres plc ulster t elevision plc united business media plc
2009 long t erm incentive plan
this award was approved by shareholders on 22 april 2009 the award was granted on 7 may 2009
number of units 
awarded under 
2009 l tip
award  
date
release  
date
rob woodward 330000 7 0509 7 0512
george watt 190000 7 0509 7 0512
the total number of units awarded to all participants was one million units
performance conditions of 2009 l tip
in march 2010 the committee approved minor changes to the l tip rules to allow a proportion of the value of awards to be provided 
under an hmrc approved option plan structure in addition participants were also able to acquire interests over shares under a joint 
ownership arrangement which also provides the ability to receive part of the award value
it should be noted that the gross potential benefit to participants and the dilutive cost to shareholders under the 2009 l tip  
remains unchanged 
the company employee benefit t rust facilitated the operation of the joint ownership arrangement by assisting participants in  
the acquisition of the interests the committee believes the cost to the company of the joint ownership arrangement is more than 
outweighed by the savings made by not providing an l tip award during 2010 
remuneration report continued
comparator  
tsr group 53
any benefit payable is capped at the potential benefit the executive would have received under “the stv group plc 2005  
long t erm incentive plan” the “2005 l tip” in practice it is likely that for the same performance the 2009 l tip will deliver  
significantly less benefit
it will also be a requirement of the plan that participants will retain 50 of any post–tax gains under the 2009 l tip until they build up  
a shareholding of at least one times salary
participants in the 2009 l tip have been granted awards of units which have no value on the date of grant but have the potential to 
convert into nilcost options at the end of a three year performance period depending on the achievement of the following conditions 
•  no benefit is provided at all unless the share price is greater than 70p at this point a percentage of the additional value created  
is used to create a pool in line with the following table
threshold prices incentive value
up to 70p 0
70p to 100p 3 of excess of 70p
100p to 150p 3 of 70p100p  5 of excess of 100p
greater than 150p 3 of 70p100p  5 of 100p150p  7 5 of excess of 150p
•  the units will only convert into nil cost options if the comparative total shareholder return “tsr and return on capital employed 
“roce” targets used in conjunction with the 2005 l tip are satisfied 
•  the value of units converting is subject to a cap to the value that would have been delivered if participants had been granted an award 
under the 2005 l tip  
the maximum incentive value will be adjusted to reflect the extent to which the tsr and roce targets have been achieved 
 
part 1  50 of the maximum incentive value may be adjusted based on the extent to which the tsr targets are achieved over the three 
year performance period as set out below
tsr performance of the company against comparator group maximum incentive value vesting percentage 
median 0
median 125
upper quartile 50
straight line vesting between points
part 2  the remaining 50 of the maximum incentive value may be adjusted based on the extent to which the roce targets are 
achieved over the three year performance period
group roce performance maximum incentive value vesting percentage
10 0
10 5
20 25
30 50
straight line vesting between points annual report and accounts 2010
corporate governance 
basis of performance condition selection and measurement
the remuneration committee determines whether the performance conditions for share awards or options are satisfied where the 
performance requirements are based on roce the committee will use the principles behind the audited figures disclosed in the company’s 
financial statements and may take advice from independent advisors as to whether any adjustments are required to ensure consistency  
in accordance with the terms of the performance conditions where the performance measure is t otal shareholder return mercer human 
resources services shall calculate the tsr in accordance with the rules of the l tip and signoff these figures prior to the release of  
any award
by order of the board 
vasa babic
remuneration committee chairman 
pacific quay
glasgow g51 1pq
23 february 2011 
remuneration report continued 55
co n te n t s
a cco u n t s
56 	 	 s tv 	 gr oup 	 plc 	 c ons olidat ed 	 financial 	 s t at emen t s	
– 	 independen t 	 a udit or s ’ 	 r epor t	
58 	 c ons olidat ed 	 inc ome 	 s t at emen t
58 	 	 c ons olidat ed 	 s t at emen t	 	
o f 	 c ompr ehensiv e 	 inc ome
59 	 c ons olidat ed 	 b alanc e 	 shee t
60 	 	 c ons olidat ed 	 s t at emen t 	 o f 	 change s 	 in 	 e quit y
61 	 	 c ons olidat ed 	 s t at emen t 	 o f 	 c ash 	 flo w s
62 	 no t e s 	 t o 	 the 	 financial 	 s t at emen t s
90 	 	 s tv 	 gr oup 	 plc 	 c omp an y 	 financial 	 s t at emen t s	
– 	 independen t 	 a udit or s ’ 	 r epor t
92 	 c omp an y 	 b alanc e 	 shee t
93	 s t at emen t 	 o f 	 t o t al 	 r ec ognis ed 	 gains 	 and 	 l o s s e s
94 	 	 no t e s 	 t o 	 the 	 c omp an y 	 financial 	 s t at emen t s
100 	 	 fiv e y e ar 	 s ummary
shar eholder s
101 	 shar eholder 	 in f ormation
1 03 	 no tic e 	 o f 	 mee ting annual report and accounts 2010
a cco u n t s
w e 	 ha v e 	 audit ed 	 the 	 c ons olidat ed 	 financial 	 s t at emen t s 	 o f 	 s tv 	 gr oup 	 plc 	 f or 	 the 	 y e ar 	 ended 	 3 1 	 dec ember 	 2 010 	 which 	 c ompris e 	 the 	
c ons olidat ed 	 inc ome 	 s t at emen t  	 the 	 c ons olidat ed 	 s t at emen t 	 o f 	 c ompr ehensiv e 	 inc ome  	 the 	 c ons olidat ed 	 b alanc e 	 shee t  	 the 	 c ons olidat ed	
s t at emen t 	 o f 	 change s 	 in 	 e quit y  	 the 	 c ons olidat ed 	 s t at emen t 	 o f 	 c ash 	 flo w s 	 and 	 the 	 r elat ed 	 no t e s  	 t he 	 financial 	 r epor ting 	 fr ame w ork 	 that 	
has 	 been 	 applied 	 in 	 their 	 pr ep ar ation 	 is 	 applic able 	 la w 	 and 	 in t ernational 	 financial 	 r epor ting 	 s t andar ds 	 ifrs s  	 as 	 adop t ed 	 b y 	 the	
e ur ope an 	 union 	 	 	 	 	 	 	 	 	 	 	
											
r e spectiv e 	 r e sponsibilitie s 	 o f 	 dir ect or s 	 and 	 audit or s	 	 	 	 	 	 	 	
as 	 e xplained 	 mor e 	 fully 	 in 	 the 	 s t at emen t 	 o f 	 dir ect or s ’ 	 r e sponsibilitie s 	 s e t 	 out 	 on 	 p age 	 2 6 	 the 	 dir ect or s 	 ar e 	 r e sponsible 	 f or 	 the 	 pr ep ar ation	
o f 	 the 	 c ons olidat ed 	 financial 	 s t at emen t s 	 and 	 f or 	 being 	 s atis fied 	 that 	 the y 	 giv e 	 a 	 true 	 and 	 f air 	 vie w  	 our 	 r e sponsibilit y 	 is 	 t o 	 audit 	 and 	
e xpr e s s 	 an 	 opinion 	 on 	 the 	 c ons olidat ed 	 financial 	 s t at emen t s 	 in 	 ac c or danc e 	 with 	 applic able 	 la w 	 and 	 in t ernational 	 s t andar ds 	 on 	 a uditing 	
uk 	 and 	 ir eland 	 t ho s e 	 s t andar ds 	 r equir e 	 us 	 t o 	 c omply 	 with 	 the 	 a uditing 	 pr actic e s 	 b o ar d’ s 	 e thic al 	 s t andar ds 	 f or 	 a udit or s  	 	 	
								
t h i s 	 r e p o r t  	 i n c l u d i n g 	 t h e 	 o p i n i o n s  	 h a s 	 b e e n 	 p r e p a r e d 	 f o r 	 a n d 	 o n l y 	 f o r 	 t h e 	 c o m p a n y ’ s 	 m e m b e r s 	 a s 	 a 	 b o d y 	 i n 	 a c c o r d a n c e 	 w i t h 	 c h a p t e r 	 3	 	
o f 	 p ar t 	 16 	 o f 	 the 	 c omp anie s 	 a ct 	 2 006 	 and 	 f or 	 no 	 o ther 	 purpo s e  	 w e 	 do 	 no t  	 in 	 giving 	 the s e 	 opinions  	 ac c ep t 	 or 	 as sume 	 r e sponsibilit y 	 f or	
an y 	 o ther 	 purpo s e 	 or 	 t o 	 an y 	 o ther 	 per s on 	 t o 	 whom 	 this 	 r epor t 	 is 	 sho wn 	 or 	 in t o 	 who s e 	 hands 	 it 	 ma y 	 c ome 	 s a v e 	 wher e 	 e xpr e s sly 	 agr eed	 	
b y 	 our 	 prior 	 c ons en t 	 in 	 writing	 	 	 	 	 	 	 	 	 	
											
s c ope 	 o f 	 the 	 audit 	 o f 	 the 	 financial 	 s t at emen t s 	 	 	 	 	 	 	 	 	 	 	
an 	 audit 	 in v olv e s 	 ob t aining 	 e videnc e 	 about 	 the 	 amoun t s 	 and 	 dis clo sur e s 	 in 	 the 	 financial 	 s t at emen t s 	 suf ficien t 	 t o 	 giv e 	 r e as onable 	
as sur anc e 	 that 	 the 	 financial 	 s t at emen t s 	 ar e 	 fr ee 	 fr om 	 mat erial 	 mis s t at emen t  	 whe ther 	 c aus ed 	 b y 	 fr aud 	 or 	 err or  	 t his 	 include s 	 an 	
as s e s smen t 	 o f  	 whe ther 	 the 	 ac c oun ting 	 policie s 	 ar e 	 appr opriat e 	 t o 	 the 	 gr oup ’ s 	 cir c ums t anc e s 	 and 	 ha v e 	 been 	 c onsis t en tly 	 applied	 	
and 	 adequat ely 	 dis clo s ed 	 the 	 r e as onablene s s 	 o f 	 signific an t 	 ac c oun ting 	 e s timat e s 	 made 	 b y 	 the 	 dir ect or s 	 and 	 the 	 o v er all 	 pr e s en t ation 	 	
o f 	 the 	 financial 	 s t at emen t s 	 	 	 	 	 	 	 	 	 	
											
opinion 	 on 	 financial 	 s t at emen t s 	 	 	 	 	 	 	 	 	 	 	
in 	 our 	 opinion 	 the 	 c ons olidat ed 	 financial 	 s t at emen t s	 	 	 	 	 	 	 	 	
•	 	 giv e 	 a 	 true 	 and 	 f air 	 vie w 	 o f 	 the 	 s t at e 	 o f 	 the 	 gr oup ’ s 	 af f air s 	 as 	 at 	 3 1 	 dec ember 	 2 010 	 and 	 o f 	 it s 	 pr o fit 	 and 	 c ash 	 flo w s 	 f or 	 the 	 y e ar 	 	
then 	 ended 	 	 	 	 	 	 	 	 	 	
•	 ha v e 	 been 	 pr operly 	 pr ep ar ed 	 in 	 ac c or danc e 	 with 	 ifrs s 	 as 	 adop t ed 	 b y 	 the 	 e ur ope an 	 union 	 and 	 	 	 	 	 	
•	 ha v e 	 been 	 pr ep ar ed 	 in 	 ac c or danc e 	 with 	 the 	 r equir emen t s 	 o f 	 the 	 c omp anie s 	 a ct 	 2 006 	 and 	 ar ticle 	 4 	 o f 	 the 	 la s 	 r egulation 	 	 	
			 				
s tv 	 gr oup 	 plc 	 c ons olidat ed 	 financial 	 s t at emen t s
independent auditors’ report to the members of stv group plc 57
opinion 	 on 	 o ther 	 mat t er s 	 pr e s cribed 	 b y 	 the 	 c omp anie s 	 a ct 	 2 006 	 	 	 	 	 	 	 	 	
in 	 our 	 opinion 	 the 	 in f ormation 	 giv en 	 in 	 the 	 dir ect or s ’ 	 r epor t 	 f or 	 the 	 financial 	 y e ar 	 f or 	 which 	 the 	 c ons olidat ed 	 financial 	 s t at emen t s 	 	
ar e 	 pr ep ar ed 	 is 	 c onsis t en t 	 with 	 the 	 c ons olidat ed 	 financial 	 s t at emen t s 	 	 	 	 	 	 	 	
	
mat t er s 	 on 	 which 	 w e 	 ar e 	 r equir ed 	 t o 	 r eport 	 b y 	 e x c ep tion 	 	 	 	 	 	 	 	 	 	
w e 	 ha v e 	 no thing 	 t o 	 r epor t 	 in 	 r e spect 	 o f 	 the 	 f ollo wing 	 	 	 	 	 	 	 	 	 	
under 	 the 	 c omp anie s 	 a ct 	 2 006 	 w e 	 ar e 	 r equir ed 	 t o 	 r epor t 	 t o 	 y ou 	 if  	 in 	 our 	 opinion 	 	 	 	 	 	 	
			
•	 c er t ain 	 dis clo sur e s 	 o f 	 dir ect or s ’ 	 r emuner ation 	 specified 	 b y 	 la w 	 ar e 	 no t 	 made 	 or 	 	 	 	 	 	 	
•	 w e 	 ha v e 	 no t 	 r ec eiv ed 	 all 	 the 	 in f ormation 	 and 	 e xplanations 	 w e 	 r equir e 	 f or 	 our 	 audit 	 	 	 	 	 	
	 	 	
under 	 the 	 lis ting 	 r ule s 	 w e 	 ar e 	 r equir ed 	 t o 	 r e vie w 	 	 	 	 	 	 	 	 	 	
•	 the 	 dir ect or s ’ 	 s t at emen t  	 s e t 	 out 	 on 	 p age 	 2 6 	 in 	 r elation 	 t o 	 going 	 c onc ern 	 and 	 	 	 	 	 	 	 	
• 	 	 t h e 	 p a r t 	 o f 	 t h e 	 c o r p o r a t e 	 g o v e r n a n c e 	 s t a t e m e n t 	 r e l a t i n g 	 t o 	 t h e 	 c o m p a n y ’ s 	 c o m p l i a n c e 	 w i t h 	 t h e 	 n i n e 	 p r o v i s i o n s 	 o f 	 t h e 	 j u n e 	 2 0 0 8	
c ombined 	 c ode 	 specified 	 f or 	 our 	 r e vie w 	 	 	 	 	 	 	 	 	 	
•	 c er t ain 	 elemen t s 	 o f 	 the 	 r epor t 	 t o 	 shar eholder s 	 b y 	 the 	 b o ar d 	 on 	 dir ect or s ’ 	 r emuner ation	 	 	 	 	 	
	 	 	
other 	 mat t er 	 	 	 	 	 	 	 	 	 	
w e 	 ha v e 	 r epor t ed 	 s ep ar at ely 	 on 	 the 	 p ar en t 	 c omp an y 	 financial 	 s t at emen t s 	 o f 	 s tv 	 gr oup 	 plc 	 f or 	 the 	 y e ar 	 ended 	 3 1 	 dec ember 	 2 010 	 	
and 	 on 	 the 	 in f ormation 	 in 	 the 	 r emuner ation 	 c ommit t ee 	 r epor t 	 that 	 is 	 de s cribed 	 as 	 ha ving 	 been 	 audit ed 	 	 	 	 	
					
										
alan 	 w ils on 	  s enior 	 s t at ut or y 	 a udit or 
f or 	 and 	 on 	 behalf 	 o f 	 pric e w at erhous ec ooper s 	 llp
char t er ed 	 a c c oun t an t s 	 and 	 s t at ut ory 	 a udit or s
glas go w
2 4 	 f ebruary 	 2 011 annual report and accounts 2010
a cco u n t s
2 010 2 009
	
	
n o te
underlying	
r e s u l t s	 	
£m
ex c ep tional	
it ems	
£m
r e s u l t s	 	
f or 	 y e ar	 	
£m
underlying	
r e sult s 	
£m
ex c ep tional	
it ems	
£m
r e sult s	 	
f or 	 y e ar	
£m
c on tinuing 	 oper ations
r e v enue 5 	 1 0 4  8	 –	 	 1 0 4  8	 	 9 0  3	 –	 	 9 0  3	
ne t 	 oper ating 	 e xpens e s 	 be f or e 	 e x c ep tional 	 c o s t s	 	 90  4 –	 	 90  4 	 8 1 1 –	 	 8 1 1
litigation 	 mat t er s 8 – 	 3 5 	 3 5 –	 –	 –	
w rit edo wn 	 o f 	 in v en t ory 8 –	 	 2 7 	 2 7 –	 –	 –	
c o s t 	 o f 	 change 8 –	 	 0  9 	 0  9 –	 –	 –	
p ension 	 s ervic e 	 cr edit 8 –	 –	 –	 –	 	 4  0	 	 4  0	
oner ous 	 le as e 	 c on tr act s 8 –	 –	 –	 –	 	 3  4 	 3  4
ne t 	 oper ating 	 e xpens e s 	 90  4 	 7  1 	 9 7 5 	 8 1 1 	 0 6	 	 80 5
oper ating 	 pr o fit 	 14  4	 	 7  1 	 7  3	 	 9 2	 	 0 6	 	 9  8	
financ e 	 inc ome 	 0 2	 –	 	 0 2	 	 0  7	 –	 	 0  7	
financ e 	 c o s t s 		 – 	 borr o wings	
– 	 ia s 	 19 	 pension
9 	 25 	 15 	 4  0 	 25 –	 	 25
9 	 0 4	 –	 	 0 4	 	 1 9 –	 	 1 9
	 1 9 	 15 	 3  4 	 3  7 –	 	 3  7
pr o fit 	 be f or e 	 t ax 	 1 2  5	 	 86 	 3  9	 	 5 5	 	 0 6	 	 6 1	
t ax 	 cr edit  char ge  11 – 	 1 4	 	 1 4	 	 0 5 	 1 1 	 16
pr o fit 	 f or 	 the 	 y e ar 	 fr om 	 c on tinuing 	 oper ations 	 1 2  5	 	 7 2 	 5  3	 	 5  0	 	 0 5 	 4 5	
dis c on tinued 	 oper ations
pr o fit lo s s  	 f or 	 the 	 y e ar 	 fr om 	 	
dis c on tinued 	 oper ations 10 –	 –	 –	 –	 	 13 3 	 13 3
pr o fit lo s s  	 f or 	 the 	 y e ar 	 1 2  5	 	 7 2 	 5  3	 	 5  0	 	 13 8 	 88
e a r n i n g s   l o s s  	 p e r 	 s h a r e	
f r om 	 c on tinuing 	 oper ations
– 	 b asic 	 and 	 dilut ed
13 3 2 9p 13  9p 13  7p 12 3p
f r om 	 c on tinuing 	 and 	 dis c on tinued 	 oper ations
– 	 b asic 	 and 	 dilut ed 13 3 2 9p 13  9p 13  7p 2 4  1p 
t he 	 no t e s 	 on 	 p age s 	 6 2 	 t o 	 8 9 	 ar e 	 an 	 in t egr al 	 p ar t 	 o f 	 the s e 	 c ons olidat ed 	 financial 	 s t at emen t s 
c ons olidat ed 	 inc ome 	 s t at emen t
y ear ended 31 december 2010
c ons olidat ed 	 s t at emen t 	 o f 	 c ompr ehensiv e 	 inc ome
y ear ended 31 december 2010
n o te
2 010
£m
2 009
£m
pr o fit lo s s  	 f or 	 the 	 y e ar 53 88
a ct uarial 	 gainlo s s  	 on 	 po s t 	 emplo ymen t 	 bene fit 	 obligations 29 	9 1	 	 8 0
de f err ed 	 t ax 	  char ge  cr edit 21 	 2 9 	 22	
other 	 c ompr ehensiv e 	 inc ome  e xpens e  	 f or 	 the 	 y e ar 	 ne t 	 o f 	 t ax 	 62	 	 5 8
t o t al 	 c ompr ehensiv e 	 inc ome  e xpens e  	 f or 	 the 	 y e ar 1 1  5	 	 14 6 59
n o te
2 010
£m
2 009
£m
non–c urr en t 	 as s e t s
goodwill 	 and 	 o ther 	 in t angible 	 as s e t s 14 	 7  9	 	 82	
pr oper t y  	 plan t 	 and 	 equipmen t 15 	 10  1	 	 12 1	
de f err ed 	 t ax 	 as s e t 21 	 11 1	 	 1 1  8	
	2 9 1	 	 3 2 1	
c urr en t 	 as s e t s
in v en t orie s 16 	 3 5  8	 	 4 7  0	
t r ade 	 and 	 o ther 	 r ec eiv able s 17 	 2 6 4	 	 2 2  4	
c ash 	 and 	 c ash 	 equiv alen t s 18 	 7  6	 	 1 4  3	
shor t 	 t erm 	 b ank 	 depo sit s 18 	0 1	 	 0 5	
	 6 9  9	 	 84 2	
as s e t s 	 clas sified 	 as 	 held 	 f or 	 s ale 	 10 –	 	 12 1	
t o t al 	 as s e t s 99 0 	 1 2 8  4	
e quit y 	 at tribut able 	 t o 	 o wner s 	 o f 	 the 	 p ar en t
or dinary 	 shar e s 23 	 19 2	 	 1 8  3	
shar e 	 pr emium	 23 	 111 4	 	 1 1 1  3	
mer ger 	 r e s erv e 	 17 3  4	 	 1 7 3  4	
other 	 r e s erv e 	 0  8	 	 0 5	
a c c umulat ed 	 lo s s e s 	 3 2 4 6 	 3 3 5  4
t o t al 	 equit y 	 19 8 	 3 1 9
non–c urr en t 	 liabilitie s
b orr o wings 20 	 5 4  9	 –	
t r ade 	 and 	 o ther 	 p a y able s 19 	 2  5	 	 12	
r e tir emen t 	 bene fit 	 obligation 29 	 2 2  9	 	 3 6  0	
pr o visions	 22 	3 1	 	 3  7	
	 8 3 4	 	 40  9	
c urr en t 	 liabilitie s
b orr o wings	 20 	 5  0	 	 6 7 5	
t r ade 	 and 	 o ther 	 p a y able s 19 	 2 9  0	 	 2 8  7	
c urr en t 	 t ax 	 liabilitie s –	 	0 9	
pr o visions	 22 	 1 4	 	 1 1	
	 35  4	 	 9 82	
liabilitie s 	 dir ectly 	 as s ociat ed 	 with 	 as s e t s 	 clas sified 	 as 	 held 	 f or 	 s ale 10 –	 	 212	
t o t al 	 liabilitie s 	 1 1 8  8	 	 1 6 0  3	
t o t al 	 equit y 	 and 	 liabilitie s 	 9 9  0	 	 1 2 8  4	
t he 	 no t e s 	 on 	 p age s 	 6 2 	 t o 	 8 9 	 ar e 	 an 	 in t egr al 	 p ar t 	 o f 	 the s e 	 c ons olidat ed 	 financial 	 s t at emen t s 	 	
t he 	 c ons olidat ed 	 financial 	 s t at emen t s 	 on 	 p age s 	 5 8 	 t o 	 8 9 	 w er e 	 appr o v ed 	 b y 	 the 	 b o ar d 	 on 	 2 4 	 f ebruary 	 2 011 	 and 	 w er e 	 signed 	 on 	 it s 	 	
behalf 	 b y 	 	 	
	
r ob 	 w oodw ar d	 geor ge 	 w at t	 	 	
chie f 	 ex ec utiv e	 chie f 	 financial 	 of fic er			
c ons olidat ed 	 b alanc e 	 shee t
at 31 december 2010 annual report and accounts 2010
a cco u n t s
e quit y 	 at tribut able 	 t o 	 o wner s 	 o f 	 the 	 p ar en t
or dinar y
shar e s
£m
shar e
pr emium
£m
mer ger
r ese rv e
£m
other	
r ese rv e
£m
a c c umulat ed
l os ses
£m
total
e quit y
£m
b alanc e 	 at 	 1 	 j anuar y 	 2 010 	 1 8  3	 	 1 1 1  3	 	 1 7 3  4	 	 0 5	 	 3 3 5  4 	 3 1 9
pr o fit 	 f or 	 the 	 y e ar –	 –	 –	 –	 	 5  3	 	 5  3	
a ct uarial 	 gain –	 –	 –	 –	 	9 1	 	9 1	
de f err ed 	 t ax 	 ther eon –	 –	 –	 –	 	 2 9 	 2 9
t o t al 	 c ompr ehensiv e 	 inc ome 	 f or 	 the 	 y e ar –	 –	 –	 –	 	 115	 	 115	
own 	 shar e s 	 is sued 	 and 	 ac quir ed 	0 9	 	0 1	 –	 –	 	 1 0 –	
own 	 shar e s 	 a w ar ded – – – – 	 0  3	 	 0  3	
e quit y –s e t tled 	 shar e 	 b as ed 	 p a ymen t s –	 –	 –	 	 0  3	 –	 	 0  3	
b alanc e 	 at 	 3 1 	 dec ember 	 2 010 	 19 2	 	 111 4	 	 17 3  4	 	 0  8	 	 3 2 4 6 	 19 8
b alanc e 	 at 	 1 	 j anuar y 	 2 009 	 1 8  0	 	 1 1 1  3	 	 1 7 3  4	 	 0  7	 	 3 2 0 5 	 17  1
l o s s 	 f or 	 the 	 y e ar –	 –	 –	 –	 	 88 	 88
a ct uarial 	 lo s s –	 –	 –	 –	 	 8 0 	 8 0
de f err ed 	 t ax 	 ther eon –	 –	 –	 –	 	 22	 	 22	
t o t al 	 c ompr ehensiv e 	 e xpens e 	 f or 	 the 	 y e ar –	 –	 –	 –	 	 14 6 	 14 6
own 	 shar e s 	 is sued 	 and 	 ac quir ed 	 0  3	 –	 –	 –	 	 0 3 –	
e quit y –s e t tled 	 shar e 	 b as ed 	 p a ymen t s –	 –	 –	 	 0 2 –	 	 0 2
b alanc e 	 at 	 3 1 	 dec ember 	 2 009 	 1 8  3	 	 1 1 1  3	 	 1 7 3  4	 	 0 5	 	 3 3 5  4 	 3 1 9
c ons olidat ed 	 s t at emen t 	 o f 	 change s 	 in 	 e quit y
y ear ended 31 december 2010 61
n o te
2 010	
£m
2 009	 	
£m
oper ating 	 activitie s
c ash 	 gener at ed us ed 	 b y 	 oper ations 24 	 6  3	 	 12
in t er e s t 	 p aid 	 3  4 	 3  4
p ension 	 de ficit 	 funding 		 – 	 r ec o v ery 	 plan 	 p a ymen t 	
– 	 one 	 o f f 	 dispo s al 	 pr oc eeds 	 c on tribution
	 3  7 	 3  9
– 	 4  0
ne t 	 c ash 	 us ed 	 b y 	 oper ating 	 activitie s 	 0 8 	 125
in v e s ting 	 activitie s
in t er e s t 	 r ec eiv ed 	 0 2	 	 0 5	
pur chas e 	 o f 	 pr oper t y  	 plan t 	 and 	 equipmen t 	 0 8 	 1 0
ne t 	 c ash 	 us ed 	 b y 	 in v e s ting 	 activitie s 	 0 6 	 0 5
financing 	 activitie s
r ele as e 	 o f 	 c ash 	 on 	 depo sit 	 0 4	 	 0 5	
ne t 	 borr o wings 	  r ep aid dr a wn 	 9  0 	 1 3  7	
ne t 	 c ash 	  us ed gener at ed 	 b y 	 financing 	 activitie s 	 86 	 14 2	
ne t 	  decr e as e  	 incr e as e 	 in 	 c ash 	 and 	 c ash 	 equiv alen t s 	 10  0 	 12	
c ash 	 and 	 c ash 	 equiv alen t s 	 at 	 beginning 	 o f 	 y e ar 	 1 7  6	 	 1 6  4	
c ash 	 and 	 c ash 	 equiv alen t s 	 at 	 end 	 o f 	 y e ar 24 	 7  6	 	 17 6	
although 	 no t 	 r equir ed 	 under 	 ifrs 	 the 	 dir ect or s 	 ha v e 	 pr o vided 	 the 	 f ollo wing 	 r ec onciliation 	 o f 	 ne t 	 deb t 	 f or 	 fur ther 	 clarit y  	 ne t 	 deb t	
r epr e s en t s 	 gr oup 	 borr o wings 	 le s s 	 c ash 	 and 	 c ash 	 equiv alen t s 	 and 	 shor t 	 t erm 	 depo sit s 
r ec onciliation 	 o f 	 mo v emen t 	 in 	 ne t 	 deb t
y ear ended 31 december 2010
n o te
2 010	
£m
2 009	
£m
opening 	 ne t 	 deb t 	 4 9  4 	 3 6 4
ne t 	  decr e as e  	 incr e as e 	 in 	 c ash 	 and 	 c ash 	 equiv alen t s 	 10  0 	 12	
mo v emen t 	 in 	 deb t 	 financing 	 7  6	 	 13  7
mo v emen t 	 in 	 e s cr o w 	 c ash 	 0  4 	 0 5
clo sing 	 ne t 	 deb t 24 	 5 22 	 4 9  4
c ons olidat ed 	 s t at emen t 	 o f 	 c ash 	 flo w s	 	
y ear ended 31 december 2010 annual report and accounts 2010
a cco u n t s
1	 gener al 	 in f ormation	 	 	 	 	 	 	 	 	 	 	
s tv 	 gr oup 	 plc 	 “the 	 c omp an y” 	 is 	 a 	 c omp an y 	 which 	 is 	 lis t ed 	 on 	 the 	 l ondon 	 s t ock 	 ex change 	 and 	 is 	 inc orpor at ed 	 and 	 domiciled 	 in	 	
the 	 uk 	 t he 	 addr e s s 	 o f 	 the 	 r egis t er ed 	 o f fic e 	 is 	 p acific 	 qua y  	 glas go w  	 g5 1 	 1pq  	 t he 	 nat ur e 	 o f 	 the 	 gr oup ’ s 	 oper ations 	 and 	 it s 	 princip al 	
activitie s 	 ar e 	 s e t 	 out 	 in 	 no t e 	 5 	 	 	 	 	 	 	 	 	 	
											
2	 a dop tion 	 o f 	 ne w 	 and 	 r e vis ed 	 s t andar ds	 	 	 	 	 	 	 	 	
t her e 	 ar e 	 no 	 ne w 	 s t andar ds  	 amendmen t s 	 t o 	 s t andar ds 	 or 	 in t erpr e t ations 	 mandat ory 	 f or 	 the 	 fir s t 	 time 	 f or 	 the 	 financial 	 y e ar 	
beginning 	 1 	 january 	 2 010 	 which 	 ar e 	 r ele v an t 	 t o 	 the 	 gr oup ’ s 	 r e sult s 	 	 	 	 	 	 	
	 	
t he 	 f ollo wing 	 ne w 	 s t andar ds  	 amendmen t s 	 t o 	 s t andar ds 	 or 	 in t erpr e t ations 	 ar e 	 mandat ory 	 f or 	 the 	 fir s t 	 time 	 f or 	 the 	 financial 	 y e ar 	
beginning 	 1 	 january 	 2 010 	 and 	 ar e 	 no t 	 r ele v an t 	 t o 	 the 	 gr oup 	 or 	 had 	 no 	 mat erial 	 imp act 	 on 	 the 	 financial 	 s t at emen t s 	 	 	
ifrs 	 3 	  r e vis ed	 	 b usine s s 	 c ombinations	 	 	 	 	 	
ia s 	 2 7 	  r e vis ed	 	 c ons olidat ed 	 and 	 s ep ar at e 	 financial 	 s t at emen t s	 	 	 	
ia s 	 2 8 	  amendmen t 	 	 in v e s tmen t s 	 in 	 as s ociat e s
ia s 	 3 1 	  amendmen t 	 	 in t er e s t s 	 in 	 join t 	 v en t ur e s
ifric 	 17	 	 	 dis tribution 	 o f 	 non–c ash 	 as s e t s 	 t o 	 o wner s	
ifric 	 18	 	 	 t r ans f er s 	 o f 	 as s e t s 	 t o 	 c us t omer s 	 	 	 	 	 	
ifrs 	 1 	  amendmen t 	 	 a dditional 	 e x emp tions 	 f or 	 fir s t –time 	 adop t er s	 	 	
ifrs 	 2 	  amendmen t 	 	 gr oup 	 c ash–s e t tled 	 shar e–b as ed 	 p a ymen t 	 tr ans actions	
ia s 	 3 2 	  amendmen t 	 	 clas sific ation 	 o f 	 righ t s 	 is sue s	 	 	 	 	 	
											
a t 	 the 	 dat e 	 o f 	 authoris ation 	 o f 	 the s e 	 financial 	 s t at emen t s  	 the 	 f ollo wing 	 s t andar ds 	 and 	 in t erpr e t ations 	 which 	 ha v e 	 no t 	 y e t 	 been 	
applied 	 t o 	 the s e 	 financial 	 s t at emen t s 	 w er e 	 in 	 is sue 	 but 	 no t 	 y e t 	 e f f ectiv e	 	 	 	 	 	 	
	 	 	
ifrs 	 9	 	 	 financial 	 ins trumen t s 	 clas sific ation 	 and 	 me asur emen t	 	 	 	
ifrs 	 7 	  amendmen t 	 	 t r ans f er s 	 o f 	 financial 	 as s e t s	 	 	 	 	 	
ia s 	 2 4 	  r e vis ed	 	 r elat ed 	 p ar t y 	 dis clo sur e s	 	 	 	 	 	
ifric 	 19	 	 	 extinguishing 	 financial 	 liabilitie s 	 with 	 equit y 	 ins trumen t s	 	 	
ifric 	 14 	  r e vis ed	 	 pr ep a ymen t s 	 o f 	 a 	 minimum 	 funding 	 r equir emen t	 	 	 	 	 	
t he 	 dir ect or s 	 do 	 no t 	 e xpect 	 that 	 the 	 adop tion 	 o f 	 the s e 	 s t andar ds 	 and 	 in t erpr e t ations 	 in 	 fut ur e 	 periods 	 will 	 ha v e 	 a 	 mat erial 	 imp act	 	
on 	 the 	 financial 	 s t at emen t s 	 o f 	 the 	 gr oup 	 	 	 	 	 	 	 	 	 	
3 	 signific an t 	 ac c oun ting 	 policie s	
t he 	 princip al 	 ac c oun ting 	 policie s 	 applied 	 in 	 the 	 pr ep ar ation 	 o f 	 the s e 	 c ons olidat ed 	 financial 	 s t at emen t s 	 ar e 	 s e t 	 out 	 belo w  	 t he s e 	
policie s 	 ha v e 	 been 	 c onsis t en tly 	 applied 	 t o 	 all 	 the 	 y e ar s 	 pr e s en t ed 	 unle s s 	 o therwis e 	 s t at ed	 	 	 	 	
	
 basis of preparation          
t he 	 c ons olidat ed 	 financial 	 s t at emen t s 	 ha v e 	 been 	 pr ep ar ed 	 in 	 ac c or danc e 	 with 	 in t ernational 	 financial 	 r epor ting 	 s t andar ds 	 ifrs s  	 	
as 	 adop t ed 	 b y 	 the 	 e ur ope an 	 union 	 eu 	 ifric 	 in t erpr e t ations 	 and 	 the 	 c omp anie s 	 a ct 	 2 006 	 applic able 	 t o 	 c omp anie s 	 r epor ting 	 under	
ifrs  	 t he 	 financial 	 s t at emen t s 	 ha v e 	 been 	 pr ep ar ed 	 under 	 the 	 his t oric al 	 c o s t 	 c on v en tion 	 and 	 on 	 a 	 going 	 c onc ern 	 b asis  	 	 	
t he 	 pr ep ar ation 	 o f 	 financial 	 s t at emen t s 	 in 	 c on f ormit y 	 with 	 ifrs 	 r equir e s 	 the 	 us e 	 o f 	 c er t ain 	 critic al 	 ac c oun ting 	 e s timat e s  	 it 	 als o 	
r equir e s 	 managemen t 	 t o 	 e x er cis e 	 it s 	 judgemen t 	 in 	 the 	 pr oc e s s 	 o f 	 applying 	 the 	 gr oup ’ s 	 ac c oun ting 	 policie s  	 t he 	 ar e as 	 in v olving 	 a	
higher 	 degr ee 	 o f 	 judgemen t 	 or 	 c omple xit y  	 or 	 ar e as 	 wher e 	 as sump tions 	 and 	 e s timat e s 	 ar e 	 signific an t 	 t o 	 the 	 c ons olidat ed 	 financial 	
s t at emen t s 	 ar e 	 dis clo s ed 	 in 	 no t e 	 4 
 basis of consolidation           
t he 	 c ons olidat ed 	 financial 	 s t at emen t s 	 inc orpor at e 	 the 	 financial 	 s t at emen t s 	 o f 	 the 	 c omp an y 	 and 	 en titie s 	 c on tr olled 	 b y 	 the 	 c omp an y 	
it s 	 sub sidiarie s  	 up 	 t o 	 3 1 	 dec ember 	 e ach 	 y e ar  	 c on tr ol 	 is 	 achie v ed 	 wher e 	 the 	 c omp an y 	 has 	 the 	 po w er 	 t o 	 go v ern 	 the 	 financial 	 and 	
oper ating 	 policie s 	 o f 	 an 	 en tit y 	 s o 	 as 	 t o 	 ob t ain 	 bene fit s 	 fr om 	 it s 	 activitie s 	 	 	 	 	 	 	
	 	 	 	
												
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
for the year ended 31 december 2010 63
t he 	 r e sult s 	 o f 	 sub sidiarie s 	 ac quir ed 	 or 	 dispo s ed 	 o f 	 during 	 the 	 y e ar 	 ar e 	 included 	 in 	 the 	 c ons olidat ed 	 inc ome 	 s t at emen t 	 fr om 	 the	
e f f ectiv e 	 dat e 	 o f 	 ac quisition 	 or 	 up 	 t o 	 the 	 e f f ectiv e 	 dat e 	 o f 	 dispo s al 	 as 	 appr opriat e  	 w her e 	 nec e s s ary  	 adjus tmen t s 	 ar e 	 made 	 t o	 	
t h e 	 fi n a n c i a l 	 s t a t e m e n t s 	 o f 	 s u b s i d i a r i e s 	 t o 	 b r i n g 	 t h e 	 a c c o u n t i n g 	 p o l i c i e s 	 u s e d 	 i n 	 l i n e 	 w i t h 	 t h o s e 	 u s e d 	 b y 	 t h e 	 g r o u p 	 o n 	 c o n s o l i d a t i o n 	
all 	 in tr a–gr oup 	 tr ans actions  	 b alanc e s  	 inc ome 	 and 	 e xpens e s 	 ar e 	 eliminat ed 	 on 	 c ons olidation	 	 	 	 	
	 	 	 	
on 	 ac quisition 	 the 	 as s e t s 	 and 	 liabilitie s 	 and 	 c on tingen t 	 liabilitie s 	 o f 	 a 	 sub sidiary 	 ar e 	 me asur ed 	 at 	 their 	 f air 	 v alue s 	 at 	 the 	 dat e 	 o f	
a c q u i s i t i o n  	 a n y 	 e x c e s s 	 o f 	 t h e 	 c o s t 	 o f 	 a c q u i s i t i o n 	 o v e r 	 t h e 	 f a i r 	 v a l u e s 	 o f 	 t h e 	 i d e n t i fi a b l e 	 n e t 	 a s s e t s 	 a c q u i r e d 	 i s 	 r e c o g n i s e d 	 a s 	 g o o d w i l l 	
an y 	 de ficienc y 	 o f 	 the 	 c o s t 	 o f 	 ac quisition 	 belo w 	 the 	 f air 	 v alue s 	 o f 	 the 	 iden tifiable 	 ne t 	 as s e t s 	 ac quir ed 	 is 	 cr edit ed 	 t o 	 the 	 inc ome 	
s t at emen t 	 in 	 the 	 period 	 o f 	 ac quisition 	 	 	 	 	 	 	 	 	 	 	
	
 goodwill           
goodwill 	 arising 	 on 	 c ons olidation 	 r epr e s en t s 	 the 	 e x c e s s 	 o f 	 the 	 c o s t 	 o f 	 ac quisition 	 o v er 	 the 	 gr oup ’ s 	 in t er e s t 	 in 	 the 	 f air 	 v alue 	 o f 	 the	
iden tifiable 	 as s e t s 	 and 	 liabilitie s 	 o f 	 a 	 sub sidiary 	 at 	 the 	 dat e 	 o f 	 ac quisition 	 	 	 	 	 	 	 	
goodwill 	 is 	 r ec ognis ed 	 as 	 an 	 as s e t 	 and 	 r e vie w ed 	 f or 	 imp airmen t 	 at 	 le as t 	 annually 	 or 	 whene v er 	 ther e 	 is 	 an 	 indic at or 	 o f 	 imp airmen t 	
and 	 is 	 deemed 	 t o 	 ha v e 	 an 	 inde finit e 	 lif e  	 an y 	 imp airmen t 	 is 	 r ec ognis ed 	 immediat ely 	 in 	 the 	 inc ome 	 s t at emen t 	 and 	 is 	 no t 	 sub s equen tly 	
reversed	 										
on 	 dispo s al 	 o f 	 a 	 sub sidiary  	 as s ociat e 	 or 	 join tly 	 c on tr olled 	 en tit y 	 or 	 busine s s  	 the 	 at tribut able 	 amoun t 	 o f 	 goodwill 	 is 	 included 	 in 	 the	
de t ermination 	 o f 	 the 	 pr o fit 	 or 	 lo s s 	 on 	 dispo s al	 	 	 	 	 	 	 	 	
	
goodwill 	 arising 	 on 	 ac quisitions 	 be f or e 	 the 	 dat e 	 o f 	 tr ansition 	 t o 	 ifrs 	 has 	 been 	 r e t ained 	 at 	 the 	 pr e vious 	 uk 	 g aap 	 amoun t s 	 subject	 	
t o 	 being 	 t e s t ed 	 f or 	 imp airmen t  	 goodwill 	 writ t en 	 o f f 	 t o 	 r e s erv e s 	 under 	 uk 	 g aap 	 prior 	 t o 	 199 8 	 has 	 no t 	 been 	 r e s t at ed 	 and 	 is 	 no t	
included 	 in 	 de t ermining 	 an y 	 sub s equen t 	 pr o fit 	 or 	 lo s s 	 on 	 dispo s al	 	 	 	 	 	 	 	
	 	 	
 exceptional items          
ex c ep tional 	 it ems  	 as 	 dis clo s ed 	 on 	 the 	 f ac e 	 o f 	 the 	 inc ome 	 s t at emen t  	 ar e 	 it ems 	 which 	 due 	 t o 	 their 	 mat erial 	 and 	 non–r ec urring 	 nat ur e	
ha v e 	 been 	 clas sified 	 s ep ar at ely 	 in 	 or der 	 t o 	 dr a w 	 them 	 t o 	 the 	 at t en tion 	 o f 	 the 	 r e ader 	 o f 	 the 	 ac c oun t s 	 and 	 t o 	 sho w 	 mor e 	 ac c ur at ely 	 	
the 	 underlying 	 r e sult s 	 o f 	 the 	 gr oup 	 	 	 	 	 	 	 	 	 	
											
 non–current assets held for sale          
non–c urr en t 	 as s e t s 	 and 	 dispo s al 	 gr oup s 	 ar e 	 clas sified 	 as 	 held 	 f or 	 s ale 	 if 	 their 	 c arrying 	 amoun t 	 will 	 be 	 r ec o v er ed 	 princip ally 	 thr ough 	 	
a 	 s ale 	 tr ans action 	 r ather 	 than 	 thr ough 	 c on tinuing 	 us e  	 t his 	 c ondition 	 is 	 r egar ded 	 as 	 me t 	 only 	 when 	 the 	 s ale 	 is 	 highly 	 pr ob able 	 and	
the 	 as s e t 	  or 	 dispo s al 	 gr oup  	 is 	 a v ailable 	 f or 	 immediat e 	 s ale 	 in 	 it s 	 pr e s en t 	 c ondition 	 managemen t 	 mus t 	 be 	 c ommit t ed 	 t o 	 the 	 s ale 	
which 	 should 	 be 	 e xpect ed 	 t o 	 qualif y 	 f or 	 r ec ognition 	 as 	 a 	 c omple t ed 	 s ale 	 within 	 one 	 y e ar 	 fr om 	 the 	 dat e 	 o f 	 clas sific ation	 	
	
non–c urr en t 	 as s e t s 	  and 	 dispo s al 	 gr oup s  	 clas sified 	 as 	 held 	 f or 	 s ale 	 ar e 	 me asur ed 	 at 	 the 	 lo w er 	 o f 	 their 	 c arrying 	 amoun t 	 and 	 f air 	 	
v alue 	 le s s 	 c o s t s 	 t o 	 s ell	 	 	 	 	 	 	 	 	 	
 impairment          
as s e t s 	 that 	 ha v e 	 an 	 inde finit e 	 us e ful 	 lif e 	 ar e 	 no t 	 subject 	 t o 	 amor tis ation 	 and 	 ar e 	 t e s t ed 	 at 	 le as t 	 annually 	 or 	 whene v er 	 ther e 	 is 	 an 	
indic at or 	 o f 	 imp airmen t  	 as s e t s 	 that 	 ar e 	 subject 	 t o 	 amor tis ation 	 or 	 depr eciation 	 ar e 	 r e vie w ed 	 f or 	 imp airmen t 	 whene v er 	 e v en t s 	 or	
change s 	 in 	 cir c ums t anc e s 	 indic at e 	 that 	 the 	 c arrying 	 amoun t 	 ma y 	 no t 	 be 	 r ec o v er able  	 an 	 imp airmen t 	 lo s s 	 is 	 r ec ognis ed 	 in 	 the 	 inc ome	
s t at emen t 	 f or 	 the 	 amoun t 	 b y 	 which 	 the 	 as s e t ’ s 	 c arrying 	 v alue 	 e x c eeds 	 it s 	 r ec o v er able 	 amoun t  	 f or 	 the 	 purpo s e s 	 o f 	 as s e s sing	
imp airmen t  	 as s e t s 	 ar e 	 gr ouped 	 at 	 the 	 lo w e s t 	 le v els 	 f or 	 which 	 ther e 	 ar e 	 s ep ar at ely 	 iden tifiable 	 c ash 	 flo w s 	  c ash–gener ating 	 unit s  	 	
t he 	 r ec o v er able 	 amoun t 	 is 	 the 	 higher 	 o f 	 an 	 as s e t ’ s 	 f air 	 v alue 	 le s s 	 c o s t s 	 t o 	 s ell 	 and 	 v alue 	 in 	 us e  	 in 	 as s e s sing 	 v alue 	 in 	 us e  	 the	
e s timat ed 	 fut ur e 	 c ash 	 flo w s 	 ar e 	 dis c oun t ed 	 t o 	 their 	 pr e s en t 	 v alue 	 using 	 a 	 dis c oun t 	 r at e 	 that 	 r e flect s 	 c urr en t 	 mark e t 	 as s e s smen t s 	 	
o f 	 the 	 time 	 v alue 	 o f 	 mone y 	 and 	 the 	 risk s 	 specific 	 t o 	 the 	 as s e t  annual report and accounts 2010
a cco u n t s
3 	 signific an t 	 ac c oun ting 	 policie s 	continued 	
 
 property plant and equipment          
land 	 and 	 buildings 	 ar e 	 s t at ed 	 in 	 the 	 b alanc e 	 shee t 	 at 	 c o s t 	 le s s 	 ac c umulat ed 	 depr eciation	 	 	 	 	
						
plan t  	 t echnic al 	 equipmen t 	 and 	 o ther 	 as s e t s 	 ar e 	 s t at ed 	 at 	 c o s t 	 le s s 	 ac c umulat ed 	 depr eciation 	 and 	 r ec ognis ed 	 imp airmen t 	 lo s s 	 	
d e p r e c i a t i o n 	 i s 	 c h a r g e d 	 s o 	 a s 	 t o 	 w r i t e 	 o f f 	 t h e 	 c o s t 	 o r 	 v a l u a t i o n 	 t o 	 r e s i d u a l 	 v a l u e 	 o f 	 fi x e d 	 a s s e t s 	 o v e r 	 t h e i r 	 e s t i m a t e d 	 u s e f u l 	 l i v e s 	 	
using 	 the 	 s tr aigh t –line 	 me thod 	 on 	 the 	 f ollo wing 	 b as e s	 	 	 	 	 	 	 	 	
	 	
l e as ehold 	 buildings	 	 	 be t w een 	 5  	 and 	 10	 	 	
plan t  	 t echnic al 	 equipmen t 	 and 	 o ther	 be t w een 	 10 	 and 	 2 0	 	 	 	 	
t he 	 liv e s 	 o f 	 as s e t s 	 lis t ed 	 ar e 	 r e vie w ed 	 and 	 adjus t ed 	 if 	 appr opriat e  	 at 	 e ach 	 b alanc e 	 shee t 	 dat e 	 	 	 	 	
						
as s e t s 	 held 	 under 	 financ e 	 le as e s 	 including 	 le as ehold 	 buildings  	 ar e 	 depr eciat ed 	 o v er 	 their 	 e xpect ed 	 us e ful 	 liv e s 	 on 	 the 	 s ame 	 b asis 	 	
as 	 o wned 	 as s e t s 	 or  	 wher e 	 shor t er  	 o v er 	 the 	 t erm 	 o f 	 the 	 le as e 	 	 	 	 	 	 	 	
t he 	 gain 	 or 	 lo s s 	 arising 	 on 	 the 	 dispo s al 	 or 	 r e tir emen t 	 o f 	 an 	 as s e t 	 is 	 de t ermined 	 as 	 the 	 dif f er enc e 	 be t w een 	 the 	 s ale s 	 pr oc eeds 	 and	 	
the 	 c arrying 	 amoun t 	 o f 	 the 	 as s e t 	 and 	 is 	 r ec ognis ed 	 in 	 inc ome 	 	 	 	 	 	 	 	
	 	 	
 leasing           
l e as e s 	 ar e 	 clas sified 	 as 	 financ e 	 le as e s 	 whene v er 	 the 	 t erms 	 o f 	 the 	 le as e 	 tr ans f er 	 sub s t an tially 	 all 	 the 	 risk s 	 and 	 r e w ar ds 	 o f 	 o wner ship 	
t o 	 the 	 le s s ee  	 all 	 o ther 	 le as e s 	 ar e 	 clas sified 	 as 	 oper ating 	 le as e s 	 	 	 	 	 	 	 	
					
c o s t s 	 in 	 r e spect 	 o f 	 oper ating 	 le as e s 	 ar e 	 char ged 	 t o 	 the 	 inc ome 	 s t at emen t 	 on 	 a 	 s tr aigh t –line 	 b asis 	 o v er 	 the 	 le as e 	 t erm	 	
											
b ene fit s 	 r ec eiv ed 	 and 	 r ec eiv able 	 as 	 an 	 inc en tiv e 	 t o 	 en t er 	 in t o 	 an 	 oper ating 	 le as e 	 ar e 	 spr e ad 	 on 	 a 	 s tr aigh t –line 	 b asis 	 o v er 	 the 	 le as e 	
term	 												
 inventories           
in v en t orie s 	 ar e 	 s t at ed 	 at 	 the 	 lo w er 	 o f 	 c o s t 	 and 	 ne t 	 r e alis able 	 v alue  	 c o s t 	 c ompris e s 	 dir ect 	 mat erials  	 and 	 wher e 	 applic able  	 dir ect	
labour 	 c o s t s 	 and 	 tho s e 	 o v erhe ads 	 that 	 ha v e 	 been 	 inc urr ed 	 in 	 bringing 	 the 	 in v en t orie s 	 t o 	 their 	 pr e s en t 	 loc ation 	 and 	 c ondition 	 ne t	
r e alis able 	 v alue 	 r epr e s en t s 	 the 	 e s timat ed 	 s elling 	 pric e 	 le s s 	 e s timat ed 	 c o s t s 	 o f 	 c omple tion 	 and 	 the 	 e s timat ed 	 s elling 	 c o s t s 	 	
											
	 film 	 righ t s  	 r ec or ded 	 pr ogr amme s 	 and 	 films	 	 	 	 	 	 	 	
a c quir ed 	 film 	 righ t s 	 ar e 	 v alued 	 at 	 dir ect 	 c o s t 	 le s s 	 appr opriat e 	 pr o visions 	 and 	 ar e 	 writ t en 	 o f f 	 in 	 line 	 with 	 the 	 righ t s 	 as s ociat ed 	 with 	
individual 	 c on tr act s  	 f or 	 ac quir ed 	 film 	 righ t s 	 an 	 as s e t 	 is 	 r ec ognis ed 	 as 	 p a ymen t s 	 ar e 	 made 	 and 	 in 	 full 	 when 	 the 	 ac quir ed 	
pr ogr amming 	 is 	 a v ailable 	 f or 	 tr ansmis sion 	 r ec or ded 	 pr ogr amme s 	 ar e 	 v alued 	 at 	 dir ect 	 c o s t 	 including 	 labour 	 and 	 o v erhe ads  	 le s s	
a p p r o p r i a t e 	 p r o v i s i o n s  	 a n d 	 a r e 	 w r i t t e n 	 o f f 	 a f t e r 	 t h e 	 fi r s t 	 t r a n s m i s s i o n 	 o r 	 s a l e  	 p r o g r a m m i n g 	 m a d e 	 f o r 	 t h i r d 	 p a r t i e s 	 i s 	 v a l u e d 	 a t 	 c o s t 	
le s s 	 appr opriat e 	 pr o visions  	 and 	 is 	 char ged 	 t o 	 the 	 inc ome 	 s t at emen t 	 agains t 	 r elat ed 	 inc ome 	 	 	 	 	
								 	
 f oreign currencies          
t r ans actions 	 in 	 c urr encie s 	 o ther 	 than 	 pounds 	 s t erling 	 ar e 	 r ec or ded 	 at 	 the 	 r at e s 	 o f 	 e x change 	 pr e v ailing 	 on 	 the 	 dat e s 	 o f 	 the	
tr ans actions  	 mone t ary 	 as s e t s 	 and 	 liabilitie s 	 denominat ed 	 in 	 f or eign 	 c urr encie s 	 at 	 the 	 b alanc e 	 shee t 	 dat e 	 ar e 	 r epor t ed 	 at 	 the 	 r at e s	 	
o f 	 e x change 	 pr e v ailing 	 at 	 that 	 dat e 	 	 	 	 	 	 	 	 	 	 	
revenue recognition          
r e v enue 	 is 	 me asur ed 	 at 	 the 	 f air 	 v alue 	 o f 	 the 	 c onsider ation 	 r ec eiv ed 	 or 	 r ec eiv able 	 and 	 r epr e s en t s 	 amoun t s 	 r ec eiv able 	 f or 	 goods	 	
and 	 s ervic e s 	 pr o vided 	 in 	 the 	 normal 	 c our s e 	 o f 	 busine s s  	 ne t 	 o f 	 dis c oun t s 	 and 	 v a t  	 r e v enue 	 fr om 	 the 	 s ale 	 o f 	 goods 	 is 	 r ec ognis ed	 	
when 	 the 	 gr oup 	 has 	 tr ans f err ed 	 the 	 signific an t 	 risk s 	 and 	 r e w ar ds 	 o f 	 o wner ship 	 and 	 c on tr ol 	 o f 	 the 	 goods 	 s old 	 and 	 the 	 amoun t 	 o f 	
r e v enue 	 c an 	 be 	 me asur ed 	 r eliably  	 k e y 	 clas s e s 	 o f 	 r e v enue 	 ar e 	 r ec ognis ed 	 on 	 the 	 f ollo wing 	 b asis	 	 	 	 	
	
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 65
air time 	 r e v enue	 on 	 tr ansmis sion	 	 	 	 	 	
spons or ship	 	 e v enly 	 o v er 	 the 	 lif e 	 o f 	 the 	 c on tr act	 	 	 	 	 	
pr ogr amme 	 pr oduction 	 	 on 	 deliv ery 		 	 	 	 	 	 	
r e v enue 	 on 	 b ar t er 	 tr ans actions 	 is 	 r ec ognis ed 	 only 	 when 	 the 	 goods 	 or 	 s ervic e s 	 being 	 e x changed 	 ar e 	 o f 	 a 	 dis similar 	 nat ur e 
 taxation          
t he 	 t ax 	 e xpens e 	 r epr e s en t s 	 the 	 sum 	 o f 	 c urr en t 	 t ax 	 and 	 de f err ed 	 t ax	 	 	 	 	 	 	
	 	 	
	 c urr en t 	 t ax										
t he 	 t ax 	 c urr en tly 	 p a y able 	 is 	 b as ed 	 on 	 t ax able 	 pr o fit 	 f or 	 the 	 y e ar  	 t ax able 	 pr o fit 	 dif f er s 	 fr om 	 ne t 	 pr o fit 	 as 	 r epor t ed 	 in 	 the 	 inc ome 	
s t at emen t 	 bec aus e 	 it 	 e x clude s 	 it ems 	 o f 	 inc ome 	 or 	 e xpens e 	 that 	 ar e 	 t ax able 	 or 	 deductible 	 in 	 o ther 	 y e ar s 	 and 	 it 	 fur ther 	 e x clude s	 	
it ems 	 that 	 ar e 	 ne v er 	 t ax able 	 or 	 deductible  	 t he 	 gr oup ’ s 	 liabilit y 	 f or 	 c urr en t 	 t ax 	 is 	 c alc ulat ed 	 using 	 t ax 	 r at e s 	 that 	 ha v e 	 been 	 enact ed	 	
or 	 sub s t an tiv ely 	 enact ed 	 b y 	 the 	 b alanc e 	 shee t 	 dat e 	 	 	 	 	 	 	 	 	
	 de f err ed 	 t ax 	 	 	 	 	 	 	 	 	 	 	
de f err ed 	 t ax 	 is 	 the 	 t ax 	 e xpect ed 	 t o 	 be 	 p a y able 	 or 	 r ec o v er able 	 on 	 dif f er enc e s 	 be t w een 	 the 	 c arrying 	 amoun t s 	 o f 	 as s e t s 	 and 	 liabilitie s	 	
in 	 the 	 financial 	 s t at emen t s 	 and 	 the 	 c orr e sponding 	 t ax 	 b as e s 	 us ed 	 in 	 the 	 c omput ation 	 o f 	 t ax able 	 pr o fit  	 and 	 is 	 ac c oun t ed 	 f or 	 using 	 	
the 	 b alanc e 	 shee t 	 liabilit y 	 me thod 	 de f err ed 	 t ax 	 liabilitie s 	 ar e 	 gener ally 	 r ec ognis ed 	 f or 	 all 	 t ax able 	 t empor ary 	 dif f er enc e s 	 and 	 de f err ed	
t ax 	 as s e t s 	 ar e 	 r ec ognis ed 	 t o 	 the 	 e xt en t 	 that 	 it 	 is 	 pr ob able 	 that 	 t ax able 	 pr o fit s 	 will 	 be 	 a v ailable 	 agains t 	 which 	 deductible 	 t empor ary 	
dif f er enc e s 	 c an 	 be 	 utilis ed 	 s uch 	 as s e t s 	 and 	 liabilitie s 	 ar e 	 no t 	 r ec ognis ed 	 if 	 the 	 t empor ary 	 dif f er enc e s 	 aris e 	 fr om 	 goodwill 	 or 	 fr om	 	
the 	 initial 	 r ec ognition 	  o ther 	 than 	 in 	 a 	 busine s s 	 c ombination  	 o f 	 o ther 	 as s e t s 	 and 	 liabilitie s 	 in 	 a 	 tr ans action 	 that 	 af f ect s 	 neither 	 the	 	
t ax 	 pr o fit 	 nor 	 the 	 ac c oun ting 	 pr o fit 	 	 	 	 	 	 	 	 	 	
											
t he 	 c arrying 	 amoun t 	 o f 	 de f err ed 	 t ax 	 as s e t s 	 is 	 r e vie w ed 	 at 	 e ach 	 b alanc e 	 shee t 	 dat e 	 and 	 r educ ed 	 t o 	 the 	 e xt en t 	 that 	 it 	 is 	 no 	 longer	
pr ob able 	 that 	 suf ficien t 	 t ax able 	 pr o fit s 	 will 	 be 	 a v ailable 	 t o 	 allo w 	 all 	 or 	 p ar t 	 o f 	 the 	 as s e t 	 t o 	 be 	 r ec o v er ed	 	 	 	
d e f e r r e d 	 t a x 	 i s 	 c a l c u l a t e d 	 a t 	 t h e 	 t a x 	 r a t e s 	 t h a t 	 a r e 	 e x p e c t e d 	 t o 	 a p p l y 	 i n 	 t h e 	 p e r i o d 	 w h e n 	 t h e 	 l i a b i l i t y 	 i s 	 s e t t l e d 	 o r 	 t h e 	 a s s e t 	 i s 	 r e a l i s e d 	
d e f e r r e d 	 t a x 	 i s 	 c h a r g e d 	 o r 	 c r e d i t e d 	 i n 	 t h e 	 i n c o m e 	 s t a t e m e n t  	 e x c e p t 	 w h e n 	 i t 	 r e l a t e s 	 t o 	 i t e m s 	 c h a r g e d 	 o r 	 c r e d i t e d 	 d i r e c t l y 	 t o 	 e q u i t y 	 	
in 	 which 	 c as e 	 the 	 de f err ed 	 t ax 	 is 	 als o 	 de alt 	 with 	 in 	 equit y 	 	 	 	 	 	 	 	
	 	
 dividends          
t he 	 liabilit y 	 f or 	 final 	 dividends 	 is 	 r ec or ded 	 when 	 the 	 dividends 	 ar e 	 appr o v ed 	 b y 	 the 	 gr oup ’ s 	 shar eholder s 	 	 	 	
						
f or 	 in t erim 	 dividends  	 the 	 liabilit y 	 is 	 r ec or ded 	 when 	 the 	 dividends 	 ar e 	 p aid	 	 	 	 	 	 	
 retirement benefit costs          
p a ymen t s 	 t o 	 de fined 	 c on tribution 	 r e tir emen t 	 bene fit 	 s cheme s 	 ar e 	 char ged 	 as 	 an 	 e xpens e 	 as 	 the y 	 f all 	 due 	 	 	 	
f or 	 de fined 	 bene fit 	 r e tir emen t 	 bene fit 	 s cheme s  	 the 	 c o s t 	 o f 	 pr o viding 	 bene fit s 	 is 	 de t ermined 	 using 	 the 	 pr oject ed 	 unit 	 me thod 	 with 	
act uarial 	 v aluations 	 being 	 c arried 	 out 	 at 	 e ach 	 b alanc e 	 shee t 	 dat e  	 a ct uarial 	 gains 	 and 	 lo s s e s 	 ar e 	 r ec ognis ed 	 in 	 full 	 dir ectly 	 in 	 r e t ained	
e arnings 	 in 	 the 	 period 	 in 	 which 	 the y 	 oc c ur 	 and 	 pr e s en t ed 	 in 	 the 	 s t at emen t 	 o f 	 c ompr ehensiv e 	 inc ome  	 	 	 	 	
						
t he 	 r e tir emen t 	 bene fit 	 obligation 	 r ec ognis ed 	 in 	 the 	 b alanc e 	 shee t 	 r epr e s en t s 	 the 	 pr e s en t 	 v alue 	 o f 	 the 	 de fined 	 bene fit 	 obligation 	 	
as 	 adjus t ed 	 f or 	 unr ec ognis ed 	 p as t 	 s ervic e 	 c o s t  	 and 	 as 	 r educ ed 	 b y 	 the 	 f air 	 v alue 	 o f 	 s cheme 	 as s e t s  	 	
provisions          
pr o visions 	 ar e 	 r ec ognis ed 	 when 	 the 	 gr oup 	 has 	 a 	 pr e s en t 	 obligation 	 as 	 a 	 r e sult 	 o f 	 a 	 p as t 	 e v en t  	 it 	 is 	 pr ob able 	 that 	 the 	 gr oup 	 will	 	
be 	 r equir ed 	 t o 	 s e t tle 	 that 	 obligation 	 and 	 a 	 r eliable 	 e s timat e 	 c an 	 be 	 made 	 o f 	 the 	 amoun t 	 o f 	 the 	 obligation	 	 	 	
	 	 	 	
	 c o s t 	 o f 	 change	 	 	 	 	 	 	 	 	 	
c o s t 	 o f 	 change 	 pr o visions 	 ar e 	 r ec ognis ed 	 when 	 the 	 gr oup 	 has 	 a 	 de t ailed 	 f ormal 	 plan 	 f or 	 the 	 r eor ganis ation 	 that 	 has 	 been	
c ommunic at ed 	 t o 	 af f ect ed 	 p ar tie s  	 	 	 	 	 	 	 	 	 	 	
											 annual report and accounts 2010
a cco u n t s
3 	 signific an t 	 ac c oun ting 	 policie s 	continued 	
	
	 oner ous 	 c on tr act s	 	 	 	 	 	 	 	 	 	
pr o visions 	 f or 	 oner ous 	 c on tr act s 	 ar e 	 r ec ognis ed 	 when 	 the 	 gr oup 	 has 	 a 	 de t ailed 	 f or ec as t 	 o f 	 fut ur e 	 lo s s e s 	 fr om 	 the 	 c on tr act 
 share–based payments           
t he 	 gr oup 	 is sue s 	 equit y –s e t tled 	 shar e–b as ed 	 p a ymen t s 	 t o 	 c er t ain 	 emplo y ee s  	 e quit y –s e t tled 	 shar e–b as ed 	 p a ymen t s 	 ar e 	 me asur ed 	 at	
f air 	 v alue 	 o f 	 the 	 equit y 	 ins trumen t s 	 at 	 the 	 gr an t 	 dat e  	 t he 	 f air 	 v alue 	 e x clude s 	 the 	 e f f ect 	 o f 	 non 	 mark e t –b as ed 	 v e s ting 	 c onditions  	 	
	
t he 	 f air 	 v alue 	 de t ermined 	 at 	 the 	 gr an t 	 dat e 	 o f 	 the 	 equit y –s e t tled 	 shar e–b as ed 	 p a ymen t s 	 is 	 e xpens ed 	 on 	 a 	 s tr aigh t –line 	 b asis 	 o v er 	 the	
v e s ting 	 period 	 b as ed 	 on 	 the 	 gr oup ’ s 	 e s timat e 	 o f 	 equit y 	 ins trumen t s 	 that 	 will 	 e v en t ually 	 v e s t  	 a t 	 e ach 	 b alanc e 	 shee t 	 dat e  	 the 	 gr oup	
r e vis e s 	 it s 	 e s timat e 	 o f 	 the 	 number 	 o f 	 equit y 	 ins trumen t s 	 e xpect ed 	 t o 	 v e s t 	 as 	 a 	 r e sult 	 o f 	 the 	 e f f ect 	 o f 	 non 	 mark e t –b as ed 	 v e s ting	
c onditions  	 t he 	 imp act 	 o f 	 the 	 r e vision 	 o f 	 the 	 original 	 e s timat e s  	 if 	 an y  	 is 	 r ec ognis ed 	 in 	 pr o fit 	 and 	 lo s s 	 such 	 that 	 the 	 c umulativ e 	
e xpens e 	 r e flect s 	 the 	 r e vis ed 	 e s timat e  	 with 	 a 	 c orr e sponding 	 adjus tmen t 	 t o 	 the 	 equit y –s e t tled 	 emplo y ee 	 bene fit s 	 r e s erv e 	 	
	
f air 	 v alue 	 is 	 me asur ed 	 b y 	 us e 	 o f 	 the 	 b lack 	  	 s chole s 	 model 	 or 	 mon t e 	 c arlo 	 model 	 as 	 r ele v an t  	 t he 	 e xpect ed 	 liv e s 	 us ed 	 in 	 the 	 model	
ha v e 	 been 	 adjus t ed 	 b as ed 	 on 	 managemen t ’ s 	 be s t 	 e s timat e  	 f or 	 the 	 e f f ect s 	 o f 	 non–tr ans f er abilit y  	 e x er cis e 	 r e s trictions 	 and	
beha viour al 	 c onsider ations 	 	 	 	 	 	 	 	 	 	 	
	 	
 financial assets and liabilities         
financial 	 as s e t s 	 and 	 financial 	 liabilitie s 	 ar e 	 r ec ognis ed 	 on 	 the 	 gr oup ’ s 	 b alanc e 	 shee t 	 when 	 the 	 gr oup 	 bec ome s 	 a 	 p ar t y 	 t o 	 the 	
c on tr act ual 	 pr o visions 	 o f 	 the 	 ins trumen t 	 	 	 	 	 	 	 	 	 	
													
	 financial 	 as s e t s	 	 	 	 	 	 	 	 	 	 	
	 t r ade 	 r ec eiv able s           
t r ade 	 r ec eiv able s 	 do 	 no t 	 c arry 	 an y 	 in t er e s t 	 and 	 ar e 	 s t at ed 	 at 	 their 	 nominal 	 v alue 	 as 	 r educ ed 	 b y 	 appr opriat e 	 allo w anc e s 	 f or 	 e s timat ed	
irr ec o v er able 	 amoun t s  	 a 	 pr o vision 	 is 	 e s t ablished 	 f or 	 tr ade 	 r ec eiv able s 	 if 	 ther e 	 is 	 objectiv e 	 e videnc e 	 that 	 the 	 gr oup 	 will 	 no t 	 be 	 able 	 t o	
c ollect 	 all 	 amoun t s 	 due 	 ac c or ding 	 t o 	 the 	 original 	 t erms 	 o f 	 the 	 r ec eiv able s  	 	 	 	
	investments													
	 immat erial 	 in v e s tmen t s 	 ar e 	 r ec or ded 	 as 	 c urr en t 	 as s e t s  	 in v e s tmen t s 	 ar e 	 me asur ed 	 at 	 r epor ting 	 dat e s 	 at 	 f air 	 v alue 	 	 	
							
	 c ash 	 and 	 c ash 	 equiv alen t s	 	 	 	 	 	 	 	 	 	
c ash 	 and 	 c ash 	 equiv alen t s 	 c ompris e 	 c ash 	 on 	 hand 	 and 	 demand 	 depo sit s 	 and 	 o ther 	 shor t –t erm 	 highly 	 liquid 	 in v e s tmen t s 	 that 	 ar e	
r e adily 	 c on v er tible 	 t o 	 a 	 kno wn 	 amoun t 	 o f 	 c ash 	 and 	 ar e 	 subject 	 t o 	 an 	 insignific an t 	 risk 	 o f 	 change s 	 in 	 v alue 	 	 	 	
						
	 financial 	 liabilitie s 	 and 	 equit y	 	 	 	 	 	 	 	 	 	
	 b ank 	 borr o wings	 	 	 	 	 	 	 	 	 	
in t er e s t –be aring 	 b ank 	 lo ans 	 and 	 o v er dr aft s 	 ar e 	 initially 	 r ec or ded 	 at 	 the 	 pr oc eeds 	 r ec eiv ed 	 ne t 	 o f 	 dir ect 	 is sue 	 c o s t s  	 t he y 	 ar e	
sub s equen tly 	 me asur ed 	 at 	 amor tis ed 	 c o s t 	 using 	 the 	 e f f ectiv e 	 in t er e s t 	 r at e  	 financ e 	 c o s t s  	 including 	 pr emiums 	 p a y able 	 on 	 s e t tlemen t	
or 	 r edemp tion 	 and 	 dir ect 	 is sue 	 c o s t s  	 ar e 	 ac c oun t ed 	 f or 	 on 	 an 	 ac cruals 	 b asis 	 t o 	 the 	 inc ome 	 s t at emen t 	 and 	 ar e 	 added 	 t o 	 the 	 c arrying	
amoun t 	 o f 	 the 	 ins trumen t 	 t o 	 the 	 e xt en t 	 that 	 the y 	 ar e 	 no t 	 s e t tled 	 in 	 the 	 period 	 in 	 which 	 the y 	 aris e 	 	 	 	
	 t r ade 	 p a y able s		 	 	 	 	 	 	 	 	
t r ade 	 p a y able s 	 ar e 	 no t 	 in t er e s t 	 be aring 	 and 	 ar e 	 s t at ed 	 at 	 their 	 nominal 	 v alue 	 	 	 	 	 	
	
	 e quit y 	 ins trumen t s	 	 	 	 	 	 	 	 	 	
e quit y 	 ins trumen t s 	 is sued 	 b y 	 the 	 c omp an y 	 ar e 	 r ec or ded 	 at 	 the 	 pr oc eeds 	 r ec eiv ed 	 ne t 	 o f 	 dir ect 	 is sue 	 c o s t s 
	 deriv ativ e 	 financial 	 ins trumen t s 	 and 	 hedge 	 ac c oun ting	 	 	 	 	 	 	 	
t he 	 gr oup 	 us e s 	 deriv ativ e 	 financial 	 ins trumen t s 	 t o 	 hedge 	 it s 	 e xpo sur e 	 t o 	 fluct uations 	 in 	 in t er e s t  	 ins trumen t s 	 ac c oun t ed 	 f or 	 	
as 	 hedge s 	 ar e 	 de signat ed 	 as 	 a 	 hedge 	 at 	 the 	 inc ep tion 	 o f 	 c on tr act s  	 	 	 	 	 	 	 	
	 	 	
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 67
in 	 or der 	 t o 	 qualif y 	 f or 	 hedge 	 ac c oun ting 	 the 	 gr oup 	 is 	 r equir ed 	 t o 	 doc umen t 	 in 	 adv anc e 	 the 	 r elationship 	 be t w een 	 the 	 it em 	 being	
hedged 	 and 	 the 	 hedging 	 ins trumen t  	 t he 	 gr oup 	 is 	 als o 	 r equir ed 	 t o 	 doc umen t 	 and 	 demons tr at e 	 an 	 as s e s smen t 	 o f 	 the 	 r elationship	
b e t w e e n 	 t h e 	 h e d g e d 	 i t e m 	 a n d 	 t h e 	 h e d g i n g 	 i n s t r u m e n t  	 w h i c h 	 s h o w s 	 t h a t 	 t h e 	 h e d g e 	 w i l l 	 b e 	 h i g h l y 	 e f f e c t i v e 	 o n 	 a n 	 o n g o i n g 	 b a s i s 	 	
t his 	 e f f ectiv ene s s 	 t e s ting 	 is 	 r e–perf ormed 	 at 	 the 	 end 	 o f 	 e ach 	 quar t er 	 end 	 t o 	 ensur e 	 that 	 the 	 hedge 	 r emains 	 highly 	 e f f ectiv e 	 	
								
t he 	 f air 	 v alue 	 o f 	 in t er e s t 	 r at e 	 s w ap s 	 is 	 b as ed 	 on 	 the 	 mark e t 	 pric e 	 lib or  	 o f 	 c omp ar able 	 ins trumen t s 	 at 	 the 	 me asur emen t 	 dat e  	 	
									
t he 	 f air 	 v alue 	 o f 	 the 	 in t er e s t 	 r at e 	 s w ap 	 c on tr act 	 is 	 c alc ulat ed 	 on 	 a 	 dis c oun t ed 	 c ash 	 flo w 	 b asis 	 using 	 mark e t 	 f orw ar d 	 r at e s  	 gains 	 or 	
lo s s e s 	 arising 	 fr om 	 the 	 mo v emen t 	 t o 	 f air 	 v alue 	 ar e 	 t ak en 	 t o 	 the 	 inc ome 	 s t at emen t 	 e x c ep t 	 wher e 	 de signat ed 	 as 	 a 	 c ash 	 flo w 	 hedge 	
								
4 	 critic al 	 ac c oun ting 	 e s timat e s 	 and 	 judgemen t s	 	 	 	 	 	 	 	
i n 	 t h e 	 a p p l i c a t i o n 	 o f 	 t h e 	 g r o u p ’ s 	 a c c o u n t i n g 	 p o l i c i e s  	 w h i c h 	 a r e 	 d e s c r i b e d 	 i n 	 n o t e 	 3  	 t h e 	 d i r e c t o r s 	 a r e 	 r e q u i r e d 	 t o 	 m a k e 	 j u d g e m e n t s 	
e s timat e s 	 and 	 as sump tions 	 about 	 the 	 c arrying 	 amoun t s 	 o f 	 as s e t s 	 and 	 liabilitie s 	 that 	 ar e 	 no t 	 r e adily 	 app ar en t 	 fr om 	 o ther 	 s our c e s  	 t he	
e s timat e s 	 and 	 judgemen t s 	 ar e 	 c on tinually 	 e v aluat ed 	 and 	 ar e 	 b as ed 	 on 	 his t oric al 	 e xperienc e 	 and 	 o ther 	 f act or s  	 including 	 e xpect ations	
o f 	 fut ur e 	 e v en t s 	 that 	 ar e 	 belie v ed 	 t o 	 be 	 r e as onable 	 under 	 the 	 cir c ums t anc e s  	 a ct ual 	 r e sult s 	 ma y 	 dif f er 	 fr om 	 the s e 	 e s timat e s 	 	
								
 critical accounting estimates and assumptions        
t he 	 k e y 	 as sump tions 	 c onc erning 	 the 	 fut ur e  	 and 	 o ther 	 k e y 	 s our c e s 	 o f 	 e s timation 	 unc er t ain t y 	 at 	 the 	 b alanc e 	 shee t 	 dat e  	 that 	 ha v e	 	
a 	 s i g n i fi c a n t 	 r i s k 	 o f 	 c a u s i n g 	 a 	 m a t e r i a l 	 a d j u s t m e n t 	 t o 	 t h e 	 c a r r y i n g 	 a m o u n t s 	 o f 	 a s s e t s 	 a n d 	 l i a b i l i t i e s 	 w i t h i n 	 t h e 	 n e x t 	 fi n a n c i a l 	 y e a r 	 	
ar e 	 dis c us s ed 	 belo w 	 	 	 	 	 	 	 	 	 	
										
	 imp airmen t 	 o f 	 goodwill	 	 	 	 	 	 	 	 	 	
de t ermining 	 whe ther 	 goodwill 	 is 	 imp air ed 	 r equir e s 	 an 	 e s timation 	 o f 	 the 	 v alue 	 in 	 us e 	 o f 	 the 	 c ash–gener ating 	 unit s 	 t o 	 which 	 the	
goodwill 	 has 	 been 	 alloc at ed 	 t he 	 v alue 	 in 	 us e 	 c alc ulation 	 r equir e s 	 the 	 en tit y 	 t o 	 e s timat e 	 the 	 fut ur e 	 c ash 	 flo w s 	 e xpect ed 	 t o 	 aris e 	 	
fr om 	 the 	 c ash–gener ating 	 unit 	 and 	 a 	 suit able 	 dis c oun t 	 r at e 	 in 	 or der 	 t o 	 c alc ulat e 	 the 	 pr e s en t 	 v alue  	 de t ails 	 o f 	 the 	 imp airmen t 	 t e s ting	
ar e 	 s e t 	 out 	 in 	 no t e 	 14 	 	 	 	 	 	 	 	 	 	
										
	 p ension 	 bene fit s	 	 	 	 	 	 	 	 	 	
t he 	 pr e s en t 	 v alue 	 o f 	 the 	 pension 	 obligations 	 depends 	 on 	 a 	 number 	 o f 	 f act or s 	 that 	 ar e 	 de t ermined 	 on 	 an 	 act uarial 	 b asis 	 using	 	
a 	 number 	 o f 	 as sump tions  	 t he 	 as sump tions 	 us ed 	 in 	 de t ermining 	 the 	 ne t 	 c o s t 	 inc ome  	 f or 	 pensions 	 include 	 the 	 dis c oun t 	 r at e 	 	
an y 	 change s 	 in 	 the s e 	 as sump tions 	 will 	 imp act 	 the 	 c arrying 	 amoun t 	 o f 	 pension 	 obligations 	 	 	 	 	
					
t he 	 gr oup 	 de t ermine s 	 the 	 appr opriat e 	 dis c oun t 	 r at e 	 at 	 the 	 end 	 o f 	 e ach 	 y e ar  	 t his 	 is 	 the 	 in t er e s t 	 r at e 	 that 	 should 	 be 	 us ed 	 t o	
de t ermine 	 the 	 pr e s en t 	 v alue 	 o f 	 e s timat ed 	 fut ur e 	 c ash 	 out flo w s 	 e xpect ed 	 t o 	 be 	 r equir ed 	 t o 	 s e t tle 	 the 	 pension 	 obligations  	 in 	
de t ermining 	 the 	 appr opriat e 	 dis c oun t 	 r at e  	 the 	 gr oup 	 c onsider s 	 the 	 in t er e s t 	 r at e s 	 o f 	 high–qualit y 	 c orpor at e 	 bonds 	 that 	 ar e	
denominat ed 	 in 	 the 	 c urr enc y 	 in 	 which 	 the 	 bene fit s 	 will 	 be 	 p aid 	 and 	 that 	 ha v e 	 t erms 	 t o 	 mat urit y 	 appr o ximating 	 the 	 t erms 	 o f 	 	
the 	 r elat ed 	 pension 	 liabilit y 	 	 	 	 	 	 	 	 	 	
other 	 k e y 	 as sump tions 	 f or 	 pension 	 obligations 	 ar e 	 b as ed 	 in 	 p ar t 	 on 	 c urr en t 	 mark e t 	 c onditions  	 a dditional 	 in f ormation 	 is 	 dis clo s ed	 	
in	note	29										
										
	 pr o visions	 	 	 	 	 	 	 	 	 	
pr e s en t 	 obligations 	 arising 	 under 	 oner ous 	 c on tr act s 	 ar e 	 r ec ognis ed 	 and 	 me asur ed 	 as 	 pr o visions  	 an 	 oner ous 	 c on tr act 	 is 	 c onsider ed	
t o 	 e xis t 	 wher e 	 the 	 gr oup 	 has 	 a 	 c on tr act 	 under 	 which 	 the 	 una v oidable 	 c o s t s 	 o f 	 mee ting 	 the 	 obligations 	 under 	 the 	 c on tr act 	 e x c eed 	 the	
ec onomic 	 bene fit s 	 e xpect ed 	 t o 	 be 	 r ec eiv ed 	 under 	 it  	 t he 	 amoun t 	 r ec ognis ed 	 as 	 a 	 pr o vision 	 is 	 the 	 be s t 	 e s timat e 	 o f 	 the 	 c onsider ation 	
r equir ed 	 t o 	 s e t tle 	 the 	 pr e s en t 	 obligation 	 at 	 the 	 b alanc e 	 shee t 	 dat e  	 t aking 	 in t o 	 ac c oun t 	 the 	 risk s 	 and 	 unc er t ain tie s 	 surr ounding 	 the	
obligation 	 t he 	 gr oup 	 c onsider s 	 the 	 c o s t s 	 o f 	 an 	 oner ous 	 c on tr act 	 t aking 	 in t o 	 ac c oun t 	 an y 	 mitigating 	 inc ome  	 and 	 iden tifie s 	 the 	 o v er all 	
po t en tial 	 lo s s e s  	 a 	 pr o vision 	 is 	 then 	 made 	 agains t 	 all 	 fut ur e 	 lo s s e s 	 e xpect ed 	 o v er 	 the 	 lif e 	 o f 	 the 	 c on tr act  	 	 	 	 	
	inventory	 									
t he 	 c arrying 	 v alue 	 o f 	 s t ock 	 is 	 as s e s s ed 	 e ach 	 y e ar 	 at 	 the 	 b alanc e 	 shee t 	 dat e  	 r ec or ded 	 pr ogr amme 	 and 	 film 	 in v en t ory 	 is 	 b as ed 	 	
on 	 c on tr act ual 	 v alue s 	 with 	 an 	 e s timat ed 	 us e ful 	 lif e  	 and 	 is 	 amor tis ed 	 on 	 that 	 b asis 	 	 	 	 	 	
	 	 	 	 annual report and accounts 2010
a cco u n t s
4 	 critic al 	 ac c oun ting 	 e s timat e s 	 and 	 judgemen t s 	continued	 					
 
 critical judgements in applying the entity’s accounting policies      
t he 	 dir ect or s 	 ha v e 	 no t 	 made 	 an y 	 fur ther 	 critic al 	 judgemen t s  	 ap ar t 	 fr om 	 tho s e 	 in v olving 	 e s timations 	  which 	 ar e 	 de alt 	 with 	 s ep ar at ely	
a b o v e   	 i n 	 t h e 	 p r o c e s s 	 o f 	 a p p l y i n g 	 t h e 	 g r o u p ’ s 	 a c c o u n t i n g 	 p o l i c i e s 	
5 	 b usine s s 	 s egmen t s	 	 	 	 	 	 	 	 	
t he 	 gr oup ’ s 	 chie f 	 ex ec utiv e  	 the 	 chie f 	 oper ating 	 decision 	 mak er  	 c onsider s 	 the 	 busine s s 	 primarily 	 fr om 	 a 	 pr oduct 	 per spectiv e  	 under	
ifrs 	 8 	 the 	 r epor t able 	 s egmen t s 	 ar e 	 ther e f or e 	 br o adc as ting 	 c on t en t  	 v en t ur e s 	 and 	 cinema 	 adv er tising 	  cinema  	 t he 	 gr oup 	 s old 	 it s	
cinema 	 busine s s 	 on 	 14 	 ma y 	 2 010 	 	 	 	 	 	 	 	 	
									
t he 	 perf ormanc e 	 o f 	 the 	 s egmen t s 	 is 	 as s e s s ed 	 b as ed 	 on 	 a 	 me asur e 	 o f 	 adjus t ed 	 oper ating 	 pr o fit  	 t his 	 me asur emen t 	 b asis 	 e x clude s 	 	
the 	 e f f ect s 	 o f 	 e x c ep tional 	 it ems 	 such 	 as 	 r e s truct uring 	 c o s t s 	 	 	 	 	 	 	 	
	
ext ernal 	 s ale s
segment revenues
2 010	
£m
2 009	
£m
continuing operations
br o adc as ting 	 9 0  3	 	 7 7  8	
c o nt e nt 	 9  8	 	 8 1	
v en t ur e s 	47	 	 4  4	
	 1 0 4  8	 	 9 0  3	
discontinued operations
cinema 	 6  9	 	 19  9	
	 111 7	 	 110 2	
t urno v er 	 in 	 2 010 	 include s 	 £16m 	 o f 	 r e v enue s 	 fr om 	 s our c e s 	 out side 	 the 	 uk 	 2 009 	 £16m 
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 69
underlying 	 s egmen t 	 r e sult ex c ep tional 	 it ems s egmen t 	 r e sult
segment result
2 010	
£m
2 009	
£m
2 010	
£m
2 009	
£m
2 010	
£m
2 009 	
£m
continuing operations
br o adc as ting 	 13  4	 	 7 6	 	 3  1 –	 	 1 0  3	 	 7 6	
c o nt e nt 	 1  0	 	0 9	 	 0 2 –	 	 0  8	 	0 9	
v en t ur e s – 	 0  7	 	 0 3 –	 	 0 3 	 0  7	
	 14  4	 	 9 2	 	 3 6 –	 	 1 0  8	 	 9 2	
ex c ep tional 	 legal 	 c o s t s 	 inc urr ed 	 in 	 litigation 	 with 	 itv 	 ne t w ork 	 plc 	 and 	 itv 	 plc 	 3 5 –
ex c ep tional 	 oner ous 	 le as e 	 pr o vision 	 at tribut able 	 t o 	 gr oup – 	 3  4
ex c ep tional 	 p as t 	 s ervic e 	 pension 	 cr edit 	 at tribut able 	 t o 	 gr oup – 	 4  0	
oper ating 	 pr o fit 	73 98
financing 	 1 9 	 3  7
ex c ep tional 	 financing 	 c o s t s 	 15 –
pr o fit 	 be f or e 	 t ax 3 9 61
t ax 	 cr edit  char ge  	 1 4	 	 16
pr o fit 	 f or 	 the 	 y e ar 	 fr om 	 c on tinuing 	 oper ations 53 4 5
discontinued operations
cinema – – – 13 3 – 13 3
a t tribut able 	 t ax 	 cr edit –	 –	 	 1  5	 –	 	 1  5	 –
–	 –	 	 1  5	 	 13 3 	 1  5	 	 13 3
e x c e p t i o n a l 	 l o s s 	 o n 	 d i s p o s a l 	 o f	 	
dis c on tinued 	 oper ations 15 –
l o s s 	 f or 	 the 	 y e ar 	 fr om 	 dis c on tinued 	 oper ations – 	 13 3
profitloss attributable to equity shareholders 53 	 88
								
oper ating 	 pr o fit 	 in 	 2 010 	 include s 	 £ 0  7m 	 arising 	 out side 	 the 	 uk 	 2 009 	 £ 0  9m 
i n 	 2 0 1 0  	 t h e 	 e x c e p t i o n a l 	 i t e m s 	 i n 	 b r o a d c a s t i n g 	 r e l a t e 	 t o 	 a 	 w r i t e d o w n 	 o f 	 fi l m 	 s t o c k 	 o f 	 £ 2  7 m 	 a n d 	 a 	 £ 0  4 m 	 c o s t 	 o f 	 c h a n g e 	 p r o v i s i o n 	 	
t he 	 e x c ep tional 	 it em 	 in 	 c on t en t 	 o f 	 £ 0 2m 	 and 	 v en t ur e s 	 £ 0 3m 	 r elat e s 	 t o 	 a 	 c o s t 	 o f 	 change 	 pr o vision	 	 	 	
	
in 	 2 009  	 the 	 e x c ep tional 	 it em 	 in 	 cinema 	 o f 	 £13 3m 	 r elat ed 	 t o 	 an 	 incr e as e 	 in 	 the 	 v ue 	 oner ous 	 c on tr act 	 pr o vision 	 r e flecting 	 w e ak er 	 	
than 	 an ticip at ed 	 tr ading annual report and accounts 2010
a cco u n t s
5 	 b usine s s 	 s egmen t s 	continued
a sse t s liabilitie s
segment assets and liabilities
2 010
£m
2 009
£m
2 010
£m
2 009
£m
br o adc as ting 4 2  9	 	 6 1  7	 	 3 4  0	 	 182	
c o nt e nt 34 1	 	 3 22	 	 2  9	 	 1  8	
v en t ur e s 1 4	 	 26	 	 0  9	 	 0 5	
cinema – 12 1	 – 	 212	
t otal of all segments 78 4	 	 1086	 	 3 7  8	 	 4 1  7	
unalloc at ed 	 c orpor at e 2 0  6	 	 1 9  8	 	 8 1  0	 	 1186	
consolidated 9 9  0	 	 1 2 8  4	 	 1 1 8  8	 	 1 6 0  3	
other segment 
information
							      br o adc as ting c o nt e nt v en t ur e s cinema
2 010
£m
2 009
£m
2 010
£m
2 009
£m
2 010
£m
2 009
£m
2 010
£m
2 009
£m
c apit al 	 additions 	 0  6	 	 0 6	 –	 –	 	 0 2	 	 0  4	 –	 –	
depr eciation 	 2  3	 	 2  4	 –	 –	 	 0 2	 	 0 2	 –	 –	
s egmen t 	 as s e t s 	 c onsis t 	 primarily 	 o f 	 goodwill 	 pr oper t y  	 plan t 	 and 	 equipmen t  	 in v en t orie s 	 and 	 tr ade 	 and 	 o ther 	 r ec eiv able s 	 and 	 c ash	
and 	 b ank 	 depo sit s  	 t he y 	 e x clude 	 de f err ed 	 t ax 	 as s e t s 
s e g m e n t 	 l i a b i l i t i e s 	 c o m p r i s e 	 o p e r a t i n g 	 l i a b i l i t i e s 	 i n c l u d i n g 	 t r a d e 	 a n d 	 o t h e r 	 p a y a b l e s 	 a n d 	 p r o v i s i o n s  	 t h e y 	 e x c l u d e 	 g r o u p 	 b o r r o w i n g s 	
r e tir emen t 	 bene fit 	 obligations  	 t ax 	 liabilitie s  	 dividends 	 p a y able 	 and 	 o ther 	 non–c urr en t 	 liabilitie s 
all 	 the 	 ne t 	 as s e t s 	 in 	 2 009 	 and 	 2 010 	 w er e 	 held 	 in 	 the 	 uk 	 and 	 ther e f or e 	 oper at e 	 in 	 a 	 single 	 geogr aphic al 	 s egmen t 
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 71
6	 oper ating 	 e xpens e s 	 b y 	 nat ur e
2 010	
£m
2 009
£m
change s 	 in 	 in v en t orie s 8  5	 	 5  1
other 	 e xt ernal 	 char ge s 	 6 6  3	 	 86 9	
s t af f 	 c o s t s 16 4	 	 1 6  4	
d e p r e c i a t i o n	 	 2  5	 	 26	
oper ating 	 le as e 	 char ge s
– 	 plan t 	 and 	 machinery 	 1  0	 	 22	
– 	 o ther 	 2 4	 	 2 1	
other 	 oper ating 	 char ge s 	 0 2	 	 0 2	
	 9 7  3	 	 1 0 5  3	
a t tribut able 	 t o
c on tinuing 	 90  4	 	 8 1 1	
dis c on tinued 	 6  9	 	 2 4 2	
	 9 7  3	 	 1 0 5  3	
services provided by the group’s auditor
during 	 the 	 y e ar 	 the 	 gr oup 	 ob t ained 	 the 	 f ollo wing 	 s ervic e s 	 fr om 	 the 	 c omp an y’ s 	 audit or 
2 010
£m
2 009
£m
gr oup
f ee s 	 p a y able 	 t o 	 c omp an y 	 audit or 	 f or 	 the 	 audit 	 o f 	 p ar en t 	 c omp an y 	 and 	 c ons olidat ed 	 financial 	 s t at emen t s 0 1	 	0 1	
f ee s 	 p a y able 	 t o 	 the 	 c omp an y’ s 	 audit or 	 and 	 it ’ s 	 as s ociat e s 	 f or 	 o ther 	 s ervic e s
– 	 t he 	 audit 	 o f 	 c omp an y’ s 	 sub sidiarie s 	 pur suan t 	 t o 	 legislation 0 1	 	0 1	
– 	 other 	 s ervic e s 	 pur suan t 	 t o 	 legislation 0 1	 	0 1	
– 	 t ax 	 s ervic e s 0  3	 	 0 2	
– 	 other 0 1	 	0 1	
0 7	 	 0 6	
included 	 in 	 the 	 audit 	 f ee s 	 p a y able 	 is 	 £5k 	 2 009 	 £5k  	 p aid 	 in 	 r e spect 	 o f 	 the 	 p ar en t 	 c omp an y 
other 	 s ervic e s 	 pur suan t 	 t o 	 legislation 	 include 	 f ee s 	 f or 	 dispo s al 	 o f 	 p e arl 	  	 de an
other 	 non– audit 	 s ervic e s 	 c ompris e 	 emplo y ee 	 bene fit 	 advis ory 	 s ervic e s  annual report and accounts 2010
a cco u n t s
7	staff											
t he 	 a v er age 	 mon thly 	 number 	 o f 	 emplo y ee s 	 including 	 e x ec utiv e 	 dir ect or s  	 w as	 	 	 	 	 	
2 010
number
2 009
number
broadcasting content  ventures 
es t ablished 	 3 4 6	 	 34 9	
c on tr act 	 2 3	 	 2 0	
	 3 6 9	 	 3 69	
cinema
es t ablished 	 1 6	 	 39	
c on tr act 	 1	 	 1	
	 17	 	 4 0	
total 	 3 8 6	 	 409	
											
c on tr act 	 s t af f 	 number s 	 c onsis t 	 o f 	 emplo y ee s 	 on 	 fix ed–t erm 	 c on tr act s 	 	 	 	 	 	 	
t heir 	 aggr egat e 	 r emuner ation 	 c ompris ed	 	 	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
w age s 	 and 	 s alarie s 	 1 2  9	 	 11 9	
s ocial 	 s ec urit y 	 c o s t s 	 1 1	 	 12	
r e tir emen t 	 bene fit 	 obligation 	  s ee 	 no t e 	 2 9 	 2 4	 	 3  3	
	 16 4	 	 1 6  4	
											
included 	 within 	 the 	 r e tir emen t 	 obligation 	 abo v e 	 is 	 a 	 £28m 	 pension 	 c o s t 	 2 009 	 £1 4m  	 and 	 a 	 £ 0  4m 	 in t er e s t 	 cr edit 	 2 009 	 £1 9m	
char ge  	 t he 	 in t er e s t 	 elemen t 	 is 	 included 	 within 	 financ e 	 c o s t s 	 on 	 the 	 f ac e 	 o f 	 the 	 inc ome 	 s t at emen t 	 	 	 	
de t ails 	 o f 	 dir ect or s ’ 	 r emuner ation 	 is 	 pr o vided 	 in 	 the 	 r emuner ation 	 c ommit t ee 	 r epor t 	 on 	 p age s 	 44 	 t o 	 54 	 	 	 	
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 73
8	 ex c ep tional 	 it ems
 i litigation matters
	 	 as 	 w as 	 dis clo s ed 	 in 	 our 	 2 009 	 annual 	 r epor t  	 itv 	 plc 	 and 	 o ther 	 itv 	 en titie s 	 launched 	 a 	 claim 	 agains t 	 s tv 	 gr oup 	 and 	 sub sidiarie s	
f or 	 £15–£2 0m 	  ne t  	 primarily 	 in 	 r elation 	 t o 	 op t –out 	 pr ogr amming 	 s tv 	 is 	 vigor ously 	 de f ending 	 this 	 claim 	 and 	 in 	 addition 	 has	
launched 	 fur ther 	 c oun t er 	 claims  	 t he 	 £3 5m 	 e x c ep tional 	 r epr e s en t s 	 legal 	 c o s t s 	 inc urr ed 	 t o 	 3 1 	 dec ember 	 2 010 	 in 	 r e spect 	 o f	 	
the s e 	 claims 
 ii writedown of inventory        
	 	 a 	 s t ock 	 writ edo wn 	 o f 	 £2 7m 	 has 	 been 	 r ec ognis ed 	 during 	 the 	 y e ar 	 in 	 r elation 	 t o 	 film 	 s t ock 	 as 	 a 	 r e sult 	 o f 	 ne w 	 in f ormation 	 r ec eiv ed
 iii cost of change
	 a 	 pr o vision 	 o f 	 £ 0  9m 	 has 	 been 	 r ec ognis ed 	 during 	 the 	 y e ar 	 in 	 r elation 	 t o 	 r e s truct uring 	 within 	 the 	 busine s s 
 iv pension service credit
	 	 a 	 p as t 	 s ervic e 	 pension 	 cr edit 	  ne t 	 o f 	 pension 	 c o s t s  	 o f 	 £ 4  0m 	 w as 	 r ec ognis ed 	 in 	 2 009 	 in 	 r elation 	 t o 	 change s 	 made 	 t o 	 the 	 s c o t tish	
and 	 gr ampian 	 t ele vision 	 r e tir emen t 	 b ene fit 	 s cheme 
 v onerous lease contracts        
	 	 a 	 pr o vision 	 o f 	 £2 7m 	 w as 	 made 	 in 	 2 009 	 t o 	 incr e as e 	 the 	 initial 	 pr o vision 	 o f 	 £3  1m 	 made 	 in 	 2 008 	 in 	 r e spect 	 o f 	 a 	 shor t f all 	 on 	 a	
sub–le as e 	 o f 	 surplus 	 pr oper t y 	 at 	 the 	 gr oup ’ s 	 p acific 	 qua y  	 glas go w 	 pr emis e s 	 wher e 	 the 	 sp ac e 	 had 	 bec ome 	 surplus 	 t o 	 oper ational 	
r equir emen t s 	 f ollo wing 	 he adc oun t 	 r eductions  	 £ 0  7m 	 w as 	 als o 	 pr o vided 	 in 	 2 009 	 in 	 r e spect 	 o f 	 the 	 le as e 	 o f 	 non–c or e 	 pr oper tie s 	 	
 vi finance costs
	 	 a 	 lo s s 	 on 	 e xtinguishmen t 	 o f 	 deb t 	 o f 	 £15m 	 w as 	 r ec ognis ed 	 during 	 the 	 y e ar  	 on 	 3 	 f ebruary 	 2 010  	 the 	 gr oup 	 r enego tiat ed 	 it s	
b anking 	 f acilitie s 	 in 	 p ar t 	 t o 	 enable 	 a 	 dispo s al 	 o f 	 p e arl 	  	 de an 	 and 	 the 	 £15m 	 lo s s 	 r epr e s en t s 	 the 	 writ e 	 o f f 	 o f 	 unamor tis ed 	 f ee s	 	
in 	 r e spect 	 o f 	 the 	 original 	 deb t 	 obligations 
9 	 financ e 	 c o s t s
2 010
£m
2 009
£m
b ank 	 borr o wings 	 2  5	 	 25	
p ension 	 financ e 	  cr edit  char ge 	 0  4 	 1 9	
interest expense excluding exceptional items 	 2 1	 	 4  4	
ex c ep tional 	 financ e 	 c o s t s 	  s ee 	 no t e 	 8 	 1  5	 	 –
t otal interest expense 	 3  6	 	 4 4 annual report and accounts 2010
a cco u n t s
10 	 dis c on tinued 	 oper ations
t he 	 dispo s al 	 o f 	 the 	 gr oup ’ s 	 cinema 	 busine s s  	 p e arl 	  	 de an 	 c omple t ed 	 on 	 14 	 ma y 	 2 010 
2 010
£m
2 009
£m
post tax results from discontinued operations see note 5 – 	 13 3
ex c ep tional 	 it ems 	 included 	 within 	 the 	 r e sult s 	 ar e 	 as 	 f ollo w s
loss on disposal of discontinued operations
p e arl 	  	 de an 	 limit ed 	 w as 	 s old 	 t o 	 image 	 l t d 	 “image ” 	 f or 	 a 	 gr o s s 	 c ash 	 c onsider ation 	 o f 	 £1 	 r e sulting 	 in 	 a 	 £nil 	 po s t 	 t ax 	 r e sult 	 on	
dispo s al 	 p e arl 	  	 de an 	 p aid 	 the 	 2 010 	 minimum 	 inc ome 	 guar an t ee 	 o f 	 £17 6m 	 t o 	 v ue 	 cinemas 	 b y 	 w a y 	 o f 	 an 	 in t er c omp an y 	 lo an 	 fr om	
s tv  	 as 	 p ar t 	 o f 	 the 	 de al 	 agr eed 	 with 	 image  	 p e arl 	  	 de an 	 will 	 r ep a y 	 the 	 por tion 	 o f 	 this 	 lo an 	 r elating 	 t o 	 the 	 period 	 fr om 	 1 	 ma y 	 2 010	 	
t o 	 3 1 	 dec ember 	 2 010 	 amoun ting 	 t o 	 £ 9  1m 	 t he 	 fir s t 	 r ep a ymen t 	 o f 	 £25m 	 w as 	 r ec eiv ed 	 upon 	 c omple tion 	 fur ther 	 p a ymen t s 	 o f 	 £5  1m 	
w er e 	 r ec eiv ed 	 t o 	 3 1 	 dec ember 	 2 010 	 and 	 the 	 b alanc e 	 w as 	 fully 	 r ep aid 	 in 	 january 	 and 	 f ebruary 	 2 011
onerous contract provision
a 	 pr o vision 	 o f 	 £13 3m 	 w as 	 made 	 in 	 2 009 	 t o 	 c o v er 	 fut ur e 	 lo s s e s 	 e xpect ed 	 fr om 	 the 	 v ue 	 c on tr act 	 within 	 cinema 	 division
cash flows from discontinued operations
2 010
£m
2 009
£m
ne t 	 c ash 	 flo w s 	 fr om 	 oper ating 	 activitie s 9 5 	 9  1
ne t 	 c ash 	 flo w s 	 fr om 	 in v e s ting 	 activitie s –	 –
9 5 	 9  1
t he 	 major 	 clas s e s 	 o f 	 as s e t s 	 and 	 liabilitie s 	 c omprising 	 the 	 oper ations 	 clas sified 	 as 	 held 	 f or 	 s ale 	 ar e 	 as 	 f ollo w s
2 010
£m
2 009
£m
t r ade 	 and 	 o ther 	 r ec eiv able s –	 	 8  8	
c ash 	 and 	 c ash 	 equiv alen t s –	 	 3  3	
t otal assets classified as held for sale –	 	 12 1
t r ade 	 and 	 o ther 	 p a y able s –	 	 6 9
pr o visions 	 f or 	 liabilitie s 	 and 	 char ge s –	 	 14 3
t otal liabilities associated with assets classified as held for sale –	 	 212
net liabilities of disposal group –	 	 9  1
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 75
t he 	 ne t 	 liabilitie s 	 o f 	 p e arl 	  	 de an 	 at 	 the 	 dat e 	 o f 	 dispo s al 	 w er e 	 as 	 f ollo w s
3 0 	 april	 	
2 010
£m
pr oper t y  	 plan t 	 and 	 equipmen t 0 5	
in t angible 	 as s e t s 0 2	
t r ade 	 and 	 o ther 	 r ec eiv able s 2 29	
t r ade 	 and 	 o ther 	 p a y able s 4 3
t ax 	 liabilitie s 15
w orking 	 c apit al 	 adjus tmen t 	 agr eed 	 as 	 p ar t 	 o f 	 dispo s al 1  4	
19 2
oner ous 	 c on tr act 	 pr o vision 	 r ele as ed 11 9
l o an 	 due 	 t o 	 s tv 	 gr oup 	 plc 9  1
21 0
ne t 	 liabilitie s 18
dispo s al 	 e xpens e s 18
gainloss on disposal –
t otal consideration –
net cashflow arising on disposal
c ash 	 c onsider ation – annual report and accounts 2010
a cco u n t s
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued
11	 t ax
2 010
£m
2 009
£m
c urr en t 	 t ax
uk 	 c orpor ation 	 t ax 	 on 	 pr o fit 	 f or 	 the 	 y e ar – –
uk 	 c orpor ation 	 t ax 	 adjus tmen t 	 in 	 r e spect 	 o f 	 prior 	 y e ar s 0  7 	 1 1
0  7 	 1 1
de f err ed 	 t ax
origination 	 and 	 r e v er s al 	 o f 	 timing 	 dif f er enc e s 22 	 2  7	
t ax creditcharge for the year 2 9 	 16	
a t tribut able 	 t o
c on tinuing 	 oper ations 1 4 	 16
dis c on tinued 	 oper ations 15 –
2 9 	 16
t he 	 char ge 	 f or 	 the 	 y e ar 	 c an 	 be 	 r ec onciled 	 t o 	 the 	 pr o fit lo s s  	 per 	 the 	 inc ome 	 s t at emen t 	 as 	 f ollo w s
2 010
£m
2 009
£m
pr o fit 	 be f or e 	 t ax 	 fr om 	 c on tinuing 	 oper ations 	 3  9	 	 6 1	
l o s s 	 be f or e 	 t ax 	 fr om 	 dis c on tinued 	 oper ations 	 15 	 13 3
profitloss before tax 	 2 4	 	 7 2
t a x 	 a t 	 t h e 	 u k 	 c o r p o r a t i o n 	 t a x 	 r a t e 	 o f 	 2 8  	  2 0 0 9  	 2 8  	 	0 7	 	 2 0
other 	 e xpens e s 	 no t 	 deductible 	 f or 	 t ax 	 purpo s e s – 	 0  4	
utilis ation 	 o f 	 t ax 	 lo s s e s 	 br ough t 	 f orw ar d 	 fr om 	 prior 	 periods 	 12 –
t ax 	 lo s s e s 	 f or 	 which 	 no 	 de f err ed 	 t ax 	 is 	 r ec ognis ed – 	 2  8	
a djus tmen t s 	 t o 	 t ax 	 char ge 	 in 	 r e spect 	 o f 	 pr e vious 	 periods 	 3 8 	 0  7
t ax 	 e f f ect 	 o f 	 e x c ep tional 	 it ems	 	 1 4	 	 1 1	
t ax creditcharge for the year 	 2 9 	 16	
										
12	 dividends	 	 	 	 	 	 	 	 	
no 	 dividend 	 is 	 pr opo s ed 	 b y 	 the 	 b o ar d 	 f or 	 the 	 y e ar s 	 ended 	 3 1 	 dec ember 	 2 009 	 and 	 2 010 	 77
13 	 e arnings lo s s  	 per 	 shar e	 	 	 	 	 	 	 	 	 	
b asic 	 e arnings 	 per 	 shar e 	 “ep s ” 	 is 	 c alc ulat ed 	 b y 	 dividing 	 the 	 pr o fit 	 at tribut able 	 t o 	 equit y 	 shar eholder s 	 b y 	 the 	 w eigh t ed 	 	
a v er age 	 number 	 o f 	 or dinary 	 shar e s 	 in 	 is sue 	 during 	 the 	 period 	 e x cluding 	 or dinary 	 shar e s 	 pur chas ed 	 b y 	 the 	 c omp an y 	 and	 	
held 	 as 	 tr e asury 	 shar e s  	 	 	 	 	 	 	 	 	 	
in 	 or der 	 t o 	 c alc ulat e 	 dilut ed 	 ep s  	 the 	 w eigh t ed 	 a v er age 	 number 	 o f 	 or dinary 	 shar e s 	 in 	 is sue 	 is 	 adjus t ed 	 t o 	 as sume 	 c on v er sion 	 o f	 	
all 	 dilutiv e 	 po t en tial 	 or dinary 	 shar e s  	 t he 	 c omp an y 	 has 	 one 	 t ype 	 o f 	 dilutiv e 	 po t en tial 	 or dinary 	 shar e s 	 namely 	 shar e 	 op tions 	 gr an t ed	 	
t o 	 emplo y ee s 
ep s 	 has 	 been 	 pr e s en t ed 	 belo w 	 bo th 	 including 	 and 	 e x cluding 	 e x c ep tional 	 it ems 	 in 	 or der 	 t o 	 pr o vide 	 a 	 fuller 	 under s t anding 	 o f 	 the	 	
gr oup ’ s 	 underlying 	 perf ormanc e 	 	 	 	 	 	 	 	 	
e arnings
£m
2 010
w eigh t ed	
a v e r a g e	
number 	 o f	
shar e s 	  m 
p er 	 shar e
p enc e
e arnings
£m
2 009
w eigh t ed	
a v er age	
number 	 o f	
shar e s 	  m 
p er 	 shar e
pe n ce
basic underlying eps
e arnings 	 at tribut able 	 t o 	 or dinary 	 shar eholder s	 	 1 2  5	 	 3 8  0	 3 2 9p 	 5  0	 	 3 65	 13  7p
b asic 	 underlying 	 ep s 	 fr om 	 c on tinuing 	 oper ations 	 1 2  5	 	 3 8  0	 	 3 2 9p	 	 5  0	 	 3 65	 13  7p
basic eps including exceptional items
e arnings 	 at tribut able 	 t o 	 or dinary 	 shar eholder s	
including 	 e x c ep tional 	 it ems  	 5  3	 	 3 8  0	 13  9p 	 88 	 3 65	 2 4  1p 
eps from continuing operations
b asic 	 ep s 	 5  3	 	 3 8  0	 13  9p 	 88 	 3 65	 2 4  1p 
pr e–t ax 	 lo s s 	 fr om 	 dis c on tinued 	 oper ations 	 1  5	 3 9p 	 1 3  3	 3 6 4p
t ax 	 r elating 	 t o 	 dis c on tinued 	 oper ations 	 15 3  9p  –	 –	
basic eps from continuing operations 	 5  3	 	 3 8  0	 13  9p 	 4 5	 	 3 65	 123p
eps from discontinued operations
b asic 	 ep s
pr e–t ax 	 lo s s  	 fr om 	 dis c on tinued 	 oper ations 	 15 	 3 8  0	 3  9p  	 13 3 	 3 65	 3 6 4p 
t ax 	 r elating 	 t o 	 dis c on tinued 	 oper ations 	 1  5	 3 9p –	 –	
basic eps from discontinued operations –	 	 3 8  0	 – 	 13 3 	 3 65	 3 6 4p 
										
t her e 	 is 	 no 	 dif f er enc e 	 be t w een 	 b asic 	 and 	 dilut ed 	 ep s 	 as 	 ther e 	 is 	 no 	 mat erial 	 imp act 	 fr om 	 dilutiv e 	 shar e 	 op tions  annual report and accounts 2010
a cco u n t s
14 	 goodwill 	 and 	 o ther 	 in t angible 	 as s e t s	 	 	 	 	 	 	 	
goodwill 	 at 	 1 	 january 	 and 	 3 1 	 dec ember 	 2 010 	 w as 	 £7  9m 	 2 009 	 £7  9m  	 it 	 c ompris e s 	 c apit alis ed 	 goodwill 	 on 	 ac quisitions 	 c omple t ed	
sinc e 	 1 	 january 	 199 8 	 and 	 the 	 c o s t 	 and 	 amor tis ation 	 is 	 split 	 £10 6m 	 and 	 £2 7m 	 r e spectiv ely 	 	 	 	
t he 	 gr oup 	 t e s t s 	 goodwill 	 annually 	 f or 	 imp airmen t  	 or 	 mor e 	 fr equen tly 	 if 	 ther e 	 ar e 	 indic ations 	 that 	 goodwill 	 migh t 	 be 	 imp air ed
goodwill 	 is 	 alloc at ed 	 t o 	 the 	 gr oup ’ s 	 c ash–gener ating 	 unit s 	  c gus  	 iden tified 	 ac c or ding 	 t o 	 oper ating 	 s egmen t  	 all 	 goodwill 	 r ec ognis ed 	
at 	 the 	 y e ar 	 end 	 and 	 pr e vious 	 y e ar 	 end 	 r elat e s 	 t o 	 c on t en t 
t he 	 r ec o v er able 	 amoun t 	 o f 	 a 	 c gu 	 is 	 de t ermined 	 b as ed 	 on 	 v alue–in–us e 	 c alc ulations  	 t he s e 	 c alc ulations 	 us e 	 po s t –t ax 	 c ash 	 flo w 	
pr ojections 	 b as ed 	 on 	 financial 	 budge t s 	 appr o v ed 	 b y 	 managemen t 	 c o v ering 	 a 	 f our 	 y e ar 	 period 	 c ash 	 flo w s 	 be y ond 	 the 	 f our 	 y e ar 	
period 	 ar e 	 e xtr apolat ed 	 using 	 an 	 e s timat ed 	 gr o wth 	 r at e 	 o f 	 2 	 t he 	 gr o wth 	 r at e 	 is 	 no t 	 c onsider ed 	 t o 	 e x c eed 	 the 	 long–t erm 	 a v er age	
gr o wth 	 r at e 	 f or 	 the 	 media 	 busine s s 	 in 	 which 	 the 	 c gu 	 oper at e s  	 	 	 	 	 	 	 	 	
	
t he 	 k e y 	 as sump tions 	 us ed 	 f or 	 v alue–in–us e 	 c alc ulations 	 ar e 	 as 	 f ollo w s	 	 	 	 	 	 	
gr o wth 	 r at e	 	 2 00
dis c oun t 	 r at e	 	 10  00	 	 	 	 	
managemen t 	 de t ermined 	 ne t 	 c ash 	 flo w 	 b as ed 	 on 	 p as t 	 perf ormanc e 	 and 	 it s 	 e xpect ations 	 o f 	 mark e t 	 de v elopmen t  	 no 	 imp airmen t	
char ge 	 is 	 c onsider ed 	 t o 	 ha v e 	 aris en 	 this 	 y e ar 	 	 	 	 	 	 	 	 	
other 	 in t angible 	 as s e t s 	 o f 	 £ 0 3m 	 r elating 	 t o 	 c apit alis ed 	 s o ft w ar e 	 c o s t s 	 w er e 	 dispo s ed 	 o f 	 during 	 the 	 y e ar 	 	 	 	
	 	 	
15 	 pr opert y  	 plan t 	 and 	 equipmen t	 	 	 	 	 	 	 	 	 	
land 	 and	
b u i l d i n g s	
le as ehold
£m
plan t 	 	
t echnic al
equipmen t
and 	 o ther
£m
total
£m
cost 
a t 	 1 	 january 	 2 009 	 0  4	 	 5 4  8	 	 55 2	
a dditions –	 	 1  0	 	 1  0	
f ully 	 writ t en 	 do wn 	 0 2 	 3 2 4 	 3 26
dispo s als –	 	 0 5 	 0 5
a t 	 1 	 january 	 2 010 	 0 2	 	 2 2 9	 	2 3 1	
a dditions –	 	 0  8	 	 0  8	
f ully 	 writ t en 	 do wn –	 	 0  1 	 0  1
at 31 december 2010 	 0 2	 	 2 3  6	 	 2 3  8	
accumulated depreciation and impairment
a t 	 1 	 january 	 2 009 	 0  3	 	 4 0  7	 	 4 1  0	
char ge 	 f or 	 y e ar –	 	 26	 	 26	
f ully 	 writ t en 	 do wn 	 0 2 	 3 2 4 	 3 26
a t 	 1 	 january 	 2 010 	0 1	 	 10  9	 	 1 1  0	
char ge 	 f or 	 y e ar –	 	 25	 	 25	
dispo s als –	 	 0  3	 	 0  3	
f ully 	 writ t en 	 do wn –	 	 0  1 	 0  1
at 31 december 2010 	0 1	 	 1 3  6	 	 13  7	
net book value at 31 december 2010 	0 1	 	 1 0  0	 	 10  1	
ne t 	 book 	 v alue 	 at 	 3 1 	 dec ember 	 2 009 	0 1	 	 1 2  0	 	 12 1	
										
during 	 the 	 y e ar 	 £ 0 3m 	 o f 	 depr eciation 	 pr e viously 	 writ t en 	 b ack 	 under 	 ifrs 	 5  	 w as 	 writ t en 	 o f f 	 as 	 p ar t 	 o f 	 the 	 p e arl 	  	 de an 	 dispo s al
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 79
16	 in v en t orie s	 	 	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
film 	 righ t s 	 9 2	 	 1 2  8	
r ec or ded 	 pr ogr amme s 	 and 	 films 	 2 6  6	 	 34 2	
	 3 5  8	 	 4 7  0	
										
included 	 within 	 r ec or ded 	 pr ogr amme s 	 and 	 films 	 is 	 a 	 pr o vision 	 o f 	 £ 0 8m 	 2 009£nil	 	 	 	 	 	
	 	 	
in v en t orie s 	 r ec ognis ed 	 as 	 an 	 e xpens e 	 during 	 the 	 y e ar 	 ar e 	 included 	 within 	 oper ating 	 e xpens e s 	 analy s ed 	 in 	 no t e 	 6 	 	 	 	
	 	 	 	
t he 	 dir ect or s 	 c onsider 	 that 	 the 	 c arrying 	 amoun t 	 o f 	 in v en t orie s 	 appr o ximat e s 	 it s 	 f air 	 v alue  	 	 	 	 	 	
	 	 	 	
17 	 t r ade 	 and 	 o ther 	 r ec eiv able s	 	 	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
t r ade 	 r ec eiv able s 	 1 0  6	 	 82	
l e s s 	 pr o vision 	 f or 	 imp airmen t 	 o f 	 r ec eiv able s –	 –	
t r ade 	 r ec eiv able s 	 – 	 ne t 	 1 0  6	 	 82	
pr ep a ymen t s 	 and 	 ac crued 	 inc ome 	 8 7	 	 86	
other 	 r ec eiv able s 	71	 	 5 6	
	 2 6 4	 	 2 2  4	
										
as 	 o f 	 3 1 	 dec ember 	 2 010  	 tr ade 	 r ec eiv able s 	 o f 	 £ 0  7m 	 2 009 	 £ 0 6m  	 ar e 	 p as t 	 due  	 t he s e 	 ar e 	 ne t 	 o f 	 a 	 pr o vision 	 f or 	 b ad 	 deb t s 	 o f 	 £nil	
2 009 	 £nil 	 t r ade 	 r ec eiv able s 	 r elat e 	 t o 	 a 	 number 	 o f 	 independen t 	 c us t omer s 	 f or 	 whom 	 ther e 	 is 	 no 	 r ec en t 	 his t ory 	 o f 	 de f ault  	 t he	
ageing 	 analy sis 	 o f 	 the 	 tr ade 	 r ec eiv able s 	 is 	 as 	 f ollo w s	 	 	 	 	 	 	 	 	
g ro s s
£m
2 010
pr o vision
£m
g r oss
£m
2 009
pr o vision
£m
up 	 t o 	 3 	 mon ths 	 1 0  5	 –	 	79	 –	
3 	 t o 	 5 	 mon ths – –	 	0 1	 –	
ov er 	 5 	 mon ths 	0 1	 –	 	 0 2	 –	
	 1 0  6	 –	 	 82	 –	
										
t he 	 dir ect or s 	 c onsider 	 that 	 the 	 c arrying 	 amoun t 	 o f 	 tr ade 	 and 	 o ther 	 r ec eiv able s 	 appr o ximat e s 	 their 	 f air 	 v alue  	 all 	 r ec eiv able s 	 ar e	
e xpect ed 	 t o 	 be 	 r ec o v er ed	 	 	 	 	 	 	 	 	
	
18	 c ash 	 and 	 c ash 	 equiv alen t s	 	 	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
c ash 	 and 	 c ash 	 equiv alen t s 	 7  6	 	 1 4  3	
shor t –t erm 	 depo sit s 	0 1	 	 0 5
	
t he 	 shor t –t erm 	 b ank 	 depo sit 	 r elat e s 	 t o 	 £ 0  1m 	 2 009 	 £ 0 5m  	 plac ed 	 in 	 es cr o w 	 in 	 r elation 	 t o 	 c er t ain 	 planning 	 c ons en t s 	 c urr en tly 	 being	
s ough t 	 b y 	 prime sigh t  annual report and accounts 2010
a cco u n t s
19 	 t r ade 	 and 	 o ther 	 p a y able s	 	 	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
amoun t s 	 f alling 	 due 	 within 	 one 	 y e ar
t r ade 	 and 	 o ther 	 p a y able s 	 1 5  0	 	 1 2  7	
s ocial 	 s ec urit y 	 and 	 o ther 	 t ax e s 	 5 2	 	 2  7	
other 	 p a y able s 	 8  8	 	 1 3  3	
	 2 9  0	 	 2 8  7	
amoun t s 	 f alling 	 due 	 aft er 	 one 	 y e ar
t r ade 	 and 	 o ther 	 p a y able s 	 2  5	 	 12
	
t he 	 dir ect or s 	 c onsider 	 that 	 the 	 c arrying 	 amoun t 	 o f 	 tr ade 	 and 	 o ther 	 p a y able s 	 appr o ximat e s 	 their 	 f air 	 v alue 	
t he 	 c omp an y’ s 	 polic y 	 is 	 t o 	 s e t tle 	 the 	 t erms 	 o f 	 p a ymen t 	 with 	 supplier s 	 b y 	 inclusion 	 o f 	 the 	 r ele v an t 	 t erms 	 in 	 c on tr act s 	 and 	 t o 	 p a y	 	
in 	 ac c or danc e 	 with 	 it s 	 c on tr act ual 	 and 	 o ther 	 legal 	 obligations  	 t r ade 	 cr edit or s 	 o f 	 the 	 gr oup 	 at 	 3 1 	 dec ember 	 2 010 	 w er e 	 equiv alen t	 	
t o 	 46 	 da y s 	 o f 	 pur chas e s 	 2 009 	 4 9 	 da y s 	
2 0 	 b orr o wings	 	 	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
b ank 	 lo ans 	 5 9  9	 	 6 7 5	
t he 	 borr o wings 	 ar e 	 r ep a y able 	 as 	 f ollo w s
expiring 	 within 	 1 	 y e ar 	 5  0	 	 6 7 5	
expiring 	 in 	 2 	 t o 	 5 	 y e ar s 	 5 4  9	 –	
										
all 	 undr a wn 	 c ommit t ed 	 borr o wing 	 f acilitie s 	 ar e 	 r ep a y able 	 within 	 t w o 	 t o 	 fiv e 	 y e ar s 	 2 009 	 t w o 	 t o 	 fiv e 	 y e ar s 	 	 	 	
					
t he 	 dir ect or s 	 c onsider 	 that 	 the 	 v alue 	 o f 	 c urr en t 	 borr o wings 	 appr o ximat e 	 their 	 f air 	 v alue 	 	 	 	 	
	 	 	 	
t he 	 e f f ectiv e 	 in t er e s t 	 r at e s 	 w er e 	 as 	 f ollo w s	 	 	 	 	 	 	 	 	
2 010

2 009

b ank 	 lo ans 	  flo ating 	 4  0	 	 5  0	
as 	 at 	 3 1 	 dec ember 	 2 010  	 the 	 c omp an y 	 had 	 b ank 	 f acilitie s 	 in 	 plac e 	 t o t alling 	 £7 0  0m 	 c onsis ting 	 o f 	 a 	 £5 5  0m 	 t erm 	 f acilit y  	 £10  0m	
r e v olving 	 cr edit 	 f acilit y 	 and 	 £5  0m 	 o v er dr aft  	 t he 	 f acilitie s 	 e xpir e 	 on 	 3 1 	 dec ember 	 2 012 	 with 	 the 	 r e v olving 	 cr edit 	 f acilit y 	 amor tising	 	
b y 	 £5  0m 	 on 	 3 1 	 dec ember 	 2 011 	 s ec urit y 	 is 	 pr o vided 	 t o 	 the 	 deb t 	 pr o vider 	 b y 	 w a y 	 o f 	 cr o s s –guar an t ee s 	 and 	 a 	 shar e 	 pledge 	 	
							
a t 	 3 1 	 dec ember 	 2 010 	 £10  0m 	 2 009 	 £5  0m  	 o f 	 the 	 b ank 	 f acilit y 	 r emains 	 undr a wn	 	 	 	 	 	
	 	 	
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 81
2 1	 de f err ed 	 t ax	 	 	 	 	 	 	 	 	 	
t he 	 mo v emen t 	 in 	 de f err ed 	 t ax 	 as s e t s 	 and 	 liabilitie s 	 during 	 the 	 y e ar  	 t aking 	 in t o 	 c onsider ation 	 the 	 o f f s e t ting 	 o f 	 b alanc e s 	 within 	 the	
s ame 	 t ax 	 juris diction 	 is 	 as 	 f ollo w s
tax
tr ading	
l os ses
£m
a c c eler at ed
ta x
depr eciation
£m
r e tir emen t
bene fit
obligations
£m
total
£m
a t 	 1 	 january 	 2 010 – 	 15 	 10 3 	 118
 cr edit  char ge 	 t o 	 inc ome 	 15 	 1 4 	 0  7	 	 22
char ge 	 t o 	 equit y – – 	 2 9	 	 2 9	
at 31 december 2010 	 15 	 2 9 	 6 7 	 11 1
										
t he 	 f ollo wing 	 is 	 the 	 analy sis 	 o f 	 the 	 c urr en t 	 de f err ed 	 t ax 	 b alanc e s	 	 	 	 	 	 	 	
2 010
		 £m
2 009
		 £m
de f err ed 	 t ax 	 as s e t 
de f err ed 	 t ax 	 t o 	 be 	 r ec o v er ed 	 aft er 	 mor e 	 than 	 one 	 y e ar 	 2 0 	 116
de f err ed 	 t ax 	 t o 	 be 	 r ec o v er ed 	 within 	 one 	 y e ar 	 9  1 	 0 2
	 11 1 	 118
ne t 	 de f err ed 	 t ax 	 as s e t 	 11 1 	 118
de f err ed 	 t ax 	 as s e t 	 no t 	 r ec ognis ed 14  7 19  0
b as ed 	 on
t r ading 	 lo s s e s 14  7 183
shor t 	 t erm 	 timing 	 dif f er enc e s – 0  7
14  7 19  0
t he 	 de f err ed 	 t ax 	 as s e t 	 o f 	 £14  7m 	 which 	 has 	 no t 	 been 	 r ec ognis ed 	 r elat e s 	 t o 	 a 	 c ombination 	 o f 	 tr ading 	 t ax 	 lo s s e s 	 and 	 non 	 tr ade 	 debit s 	
during 	 the 	 y e ar  	 a 	 change 	 in 	 the 	 uk 	 c orpor ation 	 t ax 	 r at e 	 fr om 	 2 8  	 t o 	 2 7  	 w as 	 sub s t an tiv ely 	 enact ed 	 and 	 the 	 r educ ed 	 r at e 	 will 	 be	
e f f ectiv e 	 fr om 	 1 	 april 	 2 011 	 t he 	 r ele v an t 	 de f err ed 	 t ax 	 b alanc e s 	 ha v e 	 been 	 r e–me asur ed 	 ac c or dingly  	 	 	 	 	
f ur ther 	 r eductions 	 t o 	 the 	 uk 	 c orpor ation 	 t ax 	 r at e 	 ha v e 	 been 	 announc ed 	 which 	 will 	 r educ e 	 the 	 uk 	 c orpor ation 	 t ax 	 r at e 	 b y 	 1 	 per	
a n n u m 	 u n t i l 	 t h i s 	 r e a c h e s 	 2 4  	 b y 	 1 	 a p r i l 	 2 0 1 4  	 t h e s e 	 c h a n g e s 	 h a d 	 n o t 	 b e e n 	 s u b s t a n t i v e l y 	 e n a c t e d 	 a t 	 t h e 	 b a l a n c e 	 s h e e t 	 d a t e 	 a n d 	
ther e f or e  	 ar e 	 no t 	 r ec ognis ed 	 in 	 the s e 	 financial 	 s t at emen t s  	 	 	 	 	 	 	 	 	
t he 	 o v er all 	 e f f ect 	 o f 	 the 	 fur ther 	 change s 	 fr om 	 2 7  	 t o 	 2 4  	 if 	 the s e 	 applied 	 t o 	 the 	 de f err ed 	 t ax 	 b alanc e 	 r ec ognis ed 	 at 	 3 1 	 dec ember	
2 0 1 0  	 w o u l d 	 b e 	 t o 	 r e d u c e 	 t h e 	 d e f e r r e d 	 t a x 	 a s s e t 	 b y 	 £ 1  2 m 	 annual report and accounts 2010
a cco u n t s
2 2	 pr o visions	 	 	 	 	 	 	 	 	 	
c ost
o f 	 change
pr o visions
other
pr o visions
total
pr o visions
2 010
£m
2 009
£m
2 010
£m
2 009
£m
2 010
£m
2 009
£m
a t 	 1 	 january	 	0 1	 	 0  7	 	47	 	 4  7	 	 4  8	 	 5  4	
pr o vided 	 during 	 the 	 y e ar 	 0  9	 –	 –	 	 3  4	 	 0  9	 	 3  4	
utilis ed 	 during 	 the 	 y e ar 	 0 2 	 0 6 	 1 0 	 3  4 	 12 	 4  0
at 31 december 	 0  8	 	0 1	 	3 7	 	 4  7	 	 4  5	 	 4  8	
										
t he 	 pr o visions 	 ar e 	 e xpect ed 	 t o 	 be 	 utilis ed	 	 	 	 	 	 	 	 	
					
c ost
o f 	 change
pr o visions
other
pr o visions
total
pr o visions
2 010
£m
2 009
£m
2 010
£m
2 009
£m
2 010
£m
2 009
£m
w ithin 	 one 	 y e ar	 	 0  8	 	0 1	 	 0 6	 	 1  0	 	 1  4	 	 1 1	
gr e at er 	 than 	 one 	 y e ar	 –	 –	 	3 1	 	 3  7	 	3 1	 	 3  7	
	 0  8	 	0 1	 	 3  7	 	 4  7	 	 4 5	 	 4  8	
										
a 	 c o s t 	 o f 	 change 	 pr o vision 	 o f 	 £ 0  9m 	 has 	 been 	 r ec ognis ed 	 during 	 the 	 y e ar 	 in 	 r elation 	 t o 	 r e s truct uring 	 within 	 the 	 busine s s 	 	
a 	 pr o vision 	 o f 	 £2 7m 	 w as 	 made 	 in 	 2 009 	 t o 	 incr e as e 	 the 	 initial 	 pr o vision 	 o f 	 £3  1m 	 made 	 in 	 2 008 	 in 	 r e spect 	 o f 	 a 	 shor t f all 	 on 	 a 	 sub–le as e	
o f 	 surplus 	 pr oper t y 	 at 	 the 	 gr oup ’ s 	 p acific 	 qua y  	 glas go w 	 pr emis e s 	 wher e 	 the 	 sp ac e 	 had 	 bec ome 	 surplus 	 t o 	 oper ational 	 r equir emen t s 	
f ollo wing 	 he adc oun t 	 r eductions  	 £ 0  7m 	 w as 	 als o 	 pr o vided 	 in 	 2 009 	 in 	 r e spect 	 o f 	 the 	 le as e 	 o f 	 non–c or e 	 pr oper tie s 	 	 	
2 3 	 shar e 	 c apit al 	 and 	 pr emium	 	 	 	 	 	 	 	 	 	
number 	 o f	
shar e s
 thous ands 
or dinar y	
shar e s
£m
s h a r e	
pr emium	 	
£m
total
£m
a t 	 1 	 january 	 2 010 3 6 719 	 1 8  3	 	 1 1 1  3	 	 12 9 6	
is sued 	 during 	 the 	 y e ar	 								 16 17 	0 9	 	0 1	 	 1  0	
at 31 december 2010 38 336 	 19 2	 	 111 4	 	 1 3 0  6	
t he 	 t o t al 	 authoris ed 	 number 	 o f 	 or dinary 	 shar e s 	 is 	 63 	 million 	 shar e s 	 2 009 	 63 	 million 	 shar e s  	 with 	 a 	 p ar 	 v alue 	 o f 	 £ 0 50 	 per 	 shar e	
2 009 	 £ 0 50 	 per 	 shar e  	 all 	 is sued 	 shar e s 	 ar e 	 fully 	 p aid
t he 	 gr oup 	 is sued 	 16 17 3 01 	 shar e s 	 during 	 the 	 y e ar 	 4  	 o f 	 the 	 t o t al 	 or dinary 	 shar e 	 c apit al 	 is sued 	 t o 	 be 	 held 	 f or 	 the 	 dis tribution	 	
o f 	 emplo y ee 	 lo y alt y 	 a w ar ds 
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 83
2 4 	 no t e s 	 t o 	 the 	 c ons olidat ed 	 s t at emen t 	 o f 	 c ash 	 flo w s	
								
2 010
£m
2 009
£m
continuing operations
oper ating 	 pr o fit 	 be f or e 	 e x c ep tional 	 it ems  	 14  4	 	 9 2	
depr eciation 	 and 	 o ther 	 non–c ash 	 it ems 	 2  5	 	 2  8	
	
oper ating 	 c ash 	 flo w s 	 be f or e 	 e x c ep tional 	 it ems 	 and 	 mo v emen t s 	 in 	 w orking 	 c apit al 	 1 6  9	 	 1 2  0	
decr e as e incr e as e  	 in 	 in v en t orie s 	 8  5	 	 5  1
incr e as e  decr e as e 	 in 	 tr ade 	 and 	 o ther 	 r ec eiv able s 	 6 0 	 16	
incr e as e 	 in 	 tr ade 	 and 	 o ther 	 p a y able s 	 1 1	 	 3  4	
	 2 0  5	 	 11 9	
litigation 	 c o s t s 	 3 5 –	
c o s t s 	 o f 	 change 	 and 	 oner ous 	 pr oper t y 	 c o s t s 	 12 	 4  0
cash generated by continuing operations 	 1 5  8	 	79	
discontinued operations
oper ating 	 pr o fit 	 be f or e 	 e x c ep tional 	 it ems  –	 –	
depr eciation 	 and 	 o ther 	 non–c ash 	 it ems –	 –	
	
oper ating 	 c ash 	 flo w s 	 be f or e 	 e x c ep tional 	 c o s t s 	 and 	 mo v emen t s 	 in 	 w orking 	 c apit al –	 –	
incr e as e  decr e as e 	 in 	 tr ade 	 and 	 o ther 	 r ec eiv able s 	 6 1 	 2  8	
decr e as e  incr e as e 	 in 	 tr ade 	 and 	 o ther 	 p a y able s 	 26 	 1 1	
	 8 7 	3 9	
oner ous 	 c on tr act 	 c o s t s 	 0 8 	 13  0
cash used by discontinued operations 	 9 5 	 9  1
cash generatedused by operations 	 6  3	 	 12
analysis of movements in net debt
a t 	 1 	 january	
2 010
£m
c ash	
fl ow
£m
	 a t 	 3 1	
dec ember
2 010
£m
c ash 	 and 	 c ash 	 equiv alen t s 	  no t e 	 18 	 1 4  3	 	 6 7 	 7  6	
c ash 	 and 	 c ash 	 equiv alen t s 	 included 	 in 	 the 	 dispo s al 	 gr oup s 	 held 	 f or 	 s ale 	  no t e 	 10
	 3  3	 	 3 3 –
	 17 6	 	 10  0 	 7  6	
b ank 	 borr o wings 	  no t e 	 2 0 	 6 7 5 	 7 6	 	 5 9  9
shor t 	 t erm 	 depo sit s 	  no t e 	 18 	 0 5	 	 0  4 	0 1	
net debt 	 4 9  4 	 28 	 5 22 annual report and accounts 2010
a cco u n t s
2 5 	 c apit al 	 c ommitmen t s	 	 	 	 	 	 	 	 	 	
a t 	 3 1 	 dec ember 	 2 010 	 the 	 gr oup 	 had 	 no 	 c on tr act ed 	 f or 	 but 	 no t 	 pr o vided 	 c apit al 	 c ommitmen t s 	 2 009 	 nil	 	 	 	
					
2 6 		 oper ating 	 le as e 	 c ommitmen t s	 	 	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
oper ating 	 le as e 	 p a ymen t s 	 r ec ognis ed 	 in 	 the 	 inc ome 	 s t at emen t 	 f or 	 the 	 y e ar 	 3 4	 	 4  3	
										
a t 	 3 1 	 dec ember 	 the 	 gr oup 	 had 	 minimum 	 c ommitmen t s 	 in 	 r e spect 	 o f 	 non–c anc ellable 	 oper ating 	 le as e s 	 f or 	 le as ehold 	 buildings 	 p a y able	
as 	 f ollo w s	 	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
w ithin 	 one 	 y e ar 23 23
b e t w een 	 t w o 	 and 	 fiv e 	 y e ar s 	 8  8	 	 82	
a ft er 	 fiv e 	 y e ar s 	 15 2	 	 165	
	 2 6  3	 	 2 7  0	
										
2 7 	 c on tingen t 	 liabilitie s	 	 	 	 	 	 	 	 	 	
in 	 s ep t ember 	 2 009  	 itv 	 plc 	 and 	 o ther 	 itv 	 en titie s 	 launched 	 a 	 claim 	 agains t 	 s tv 	 gr oup 	 and 	 sub sidiarie s 	 f or 	 £15–£2 0m 	  ne t  	 primarily	
in 	 r elation 	 t o 	 op t –out 	 pr ogr amming 	 s tv 	 is 	 bo th 	 vigor ously 	 de f ending 	 this 	 claim 	 and 	 has 	 launched 	 a 	 c oun t er claim 	 under 	 the	
a dv er tising 	 s ale s 	 a gr eemen t  	 in 	 no v ember 	 2 009  	 s tv 	 gr oup 	 launched 	 an 	 additional 	 claim 	 in 	 r elation 	 t o 	 the 	 e xploit ation 	 o f 	 ne w	
m e d i a 	 r i g h t s  	 s t v 	 g r o u p 	 a s s e r t s 	 t h a t 	 d e s p i t e 	 n e w 	 m e d i a 	 r i g h t s 	 b e i n g 	 a c q u i r e d 	 a n d 	 h e l d 	 f o r 	 t h e 	 b e n e fi t 	 o f 	 a l l 	 c h a n n e l 	 3 	 l i c e n s e e s 	 	
itv 	 ne t w ork 	 limit ed 	 and 	 itv 	 br o adc as ting 	 limit ed 	 ha v e 	 en t er ed 	 in t o 	 c ommer cial 	 agr eemen t s 	 without 	 ob t aining 	 s tv 	 gr oup ’ s	
c ons en t  	 t he s e 	 c ommer cial 	 agr eemen t s 	 us e 	 and 	 e xploit 	 ne w 	 media 	 righ t s 	 in 	 s tv 	 c en tr al 	 and 	 s tv 	 nor th ’ s 	 lic enc e 	 ar e as  	 s tv 	 is	
pr ep aring 	 launching 	 a 	 thir d 	 in 	 r elation 	 t o 	 signific an t 	 pr ejudicial 	 beha viour 	 b y 	 itv 	 ne t w ork 	 and 	 itv 	 plc 	 agains t 	 s tv 	 gr oup 	 and 	 it s 	
sub sidiarie s  	 t he 	 v arious 	 legal 	 claims 	 r e sult 	 in 	 a 	 maximum 	 po t en tial 	 c ash 	 out flo w 	 o f 	 £14 2m 	 should 	 s tv 	 be 	 unsuc c e s s ful 	 in 	 all 	 claims 	
and 	 a 	 r elat ed 	 unpr o vided 	 c on tingen t 	 liabilit y 	 f or 	 ac c oun ting 	 purpo s e s 	 o f 	 £ 6 9m 	 s tv 	 has 	 a 	 po t en tial 	 c on tingen t 	 as s e t 	 o f 	 £7 3m 	 which	
has 	 no t 	 been 	 r ec ognis ed 	 in 	 the 	 financial 	 s t at emen t s 	 and 	 which 	 will 	 aris e 	 in 	 the 	 e v en t 	 that 	 it 	 is 	 suc c e s s ful 	 in 	 it s 	 de f enc e 	 o f 	 itv’ s 	 initial 	
claim 	 f ur ther 	 c on tingen t 	 as s e t s 	 ma y 	 aris e 	 under 	 s tv’ s 	 c oun t er claim 	 under 	 the 	 a dv er tising 	 s ale s 	 a gr eemen t  	 it s 	 claim 	 in 	 r elation	 	
t o 	 the 	 e xploit ation 	 o f 	 ne w 	 media 	 righ t s 	 and 	 it s 	 po t en tial 	 claim 	 in 	 r elation 	 t o 	 alleged 	 pr ejudicial 	 beha viour 	 b y 	 itv  	 ho w e v er 	 it 	 is 	 no t	
pr actic able 	 t o 	 quan tif y 	 the 	 t o t al 	 po t en tial 	 financial 	 e f f ect 	 o f 	 the s e 	 claims 	 and 	 po t en tial 	 claim 	 at 	 this 	 s t age 	 	 	 	
	 	
t he 	 gr oup 	 has 	 a 	 100 	 holding 	 in 	 bo th 	 s c o t tish 	 media 	 gr oup 	 holdings  	 and 	 da wn 	 chorus 	 holdings  	 which 	 ar e 	 unlimit ed 	 c omp anie s 	
2 8 		 t r ans actions 	 with 	 r elat ed 	 p artie s
t her e 	 w er e 	 no 	 tr ans actions 	 with 	 an y 	 r elat ed 	 p ar tie s 	 during 	 the 	 y e ar 
k e y 	 managemen t 	 per s onnel 	 ar e 	 deemed 	 t o 	 be 	 the 	 e x ec utiv e 	 and 	 non–e x ec utiv e 	 dir ect or s 	 o f 	 the 	 gr oup  	 as 	 the y 	 ha v e 	 authorit y 	 and	
r e sponsibilit y 	 f or 	 c on tr olling 	 the 	 gr oup ’ s 	 activitie s 
k e y 	 managemen t 	 r emuner ation 	 is 	 de t ailed 	 as 	 f ollo w s
2 010
£m
2 009
£m
s alarie s 	 and 	 shor t –t erm 	 emplo y ee 	 bene fit s 	 1  0	 	0 9	
t her e 	 ha v e 	 been 	 no 	 o ther 	 tr ans actions 	 with 	 k e y 	 managemen t 	 per s onnel 	 as 	 de fined 	 under 	 ia s 	 2 4 
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 85
2 9 	 r e tir emen t 	 bene fit 	 s cheme s
	
 defined contribution schemes
t h e 	 g r o u p 	 o p e r a t e s 	 t w o 	 m o n e y 	 p u r c h a s e 	 s c h e m e s  	 t h e 	 s t v 	 p e n s i o n 	 s c h e m e 	 a n d 	 t h e 	 p e a r l 	  	 d e a n 	 c i n e m a s 	 p e n s i o n 	 s c h e m e 	 	
f or 	 which 	 the 	 pension 	 c o s t 	 char ge 	 f or 	 the 	 y e ar 	 amoun t ed 	 t o 	 £ 0  4m 	 2 009 	 £ 0  4m 
 defined benefit schemes
t he 	 gr oup 	 oper at e s 	 t w o 	 de fined 	 bene fit 	 pension 	 s cheme s  	 t he 	 s cheme s 	 ar e 	 trus t ee 	 adminis t er ed 	 and 	 the 	 s cheme s ’ 	 as s e t s 	 ar e 	 held 	
independen tly 	 o f 	 the 	 gr oup ’ s 	 financ e s  	 p ension 	 c o s t s 	 ar e 	 as s e s s ed 	 in 	 ac c or danc e 	 with 	 the 	 advic e 	 o f 	 an 	 independen t 	 pr o f e s sionally 	
qualified 	 act uary 
t h e 	 s c h e m e s 	 a r e 	 t h e 	 s c o t t i s h 	 a n d 	 g r a m p i a n 	 t e l e v i s i o n 	 r e t i r e m e n t 	 b e n e fi t 	 s c h e m e 	 a n d 	 t h e 	 c a l e d o n i a n 	 p u b l i s h i n g 	 p e n s i o n 	 s c h e m e 	
t he y 	 ar e 	 clo s ed 	 s cheme s 	 and 	 ther e f or e 	 under 	 the 	 pr oject ed 	 unit 	 me thod 	 the 	 c urr en t 	 s ervic e 	 c o s t 	 will 	 incr e as e 	 as 	 the 	 member s 	 o f	 	
the 	 s cheme 	 appr o ach 	 r e tir emen t 
a 	 full 	 act uarial 	 v aluation 	 o f 	 the 	 s cheme s 	 w as 	 c arried 	 out 	 at 	 1 	 january 	 2 009 	 and 	 updat ed 	 t o 	 3 1 	 dec ember 	 2 010 	 b y 	 a 	 qualified 	
independen t 	 act uary  	 t he 	 major 	 as sump tions 	 us ed 	 b y 	 the 	 act uary 	 w er e
a t 	 3 1	
dec ember
2 010
a t 	 3 1	
dec ember
2 009
r at e 	 o f 	 incr e as e 	 in 	 s alarie s 1 00 1 00
r at e 	 o f 	 incr e as e 	 o f 	 pensions 	 in 	 p a ymen t 33 0  3  40
dis c oun t 	 r at e 5 55 5 7 0
in flation 	 33 0  3  40
										
 mortality rate         
as sump tions 	 r egar ding 	 fut ur e 	 mor t alit y 	 e xperienc e 	 ar e 	 s e t 	 b as ed 	 on 	 advic e  	 published 	 s t atis tic s 	 and 	 e xperienc e 	 in 	 e ach 	 t errit ory 	
t he 	 a v er age 	 lif e 	 e xpect anc y 	 in 	 y e ar s 	 o f 	 a 	 pensioner 	 r e tiring 	 at 	 age 	 6 5 	 is 	 as 	 f ollo w s
a t 	 3 1	
dec ember
2 010
years
a t 	 3 1	
dec ember
2 009
years
r e tiring 	 at 	 b alanc e 	 shee t 	 dat e
male 1 5 0 1 5 0
f emale 179 179
r e tiring 	 in 	 2 0 	 y e ar s
male 166 166
f emale 19 5 19 5
amount charged to operating profit
2 010
£m
2 009
£m
c urr en t 	 s ervic e 	 c o s t 	 – 	 de fined 	 bene fit 	 2 4 	 1 0
										
t he 	 t o t al 	 amoun t 	 char ged 	 t o 	 pr o fit 	 fr om 	 oper ations 	 is 	 £28m 	 2 009 	 £1 4m  	 which 	 als o 	 include s 	 the 	 de fined 	 c on tribution 	 char ge 	 	
o f 	 £ 0  4m 	 2 009 	 £ 0  4m 		 	 	 	 	 	 	 	 annual report and accounts 2010
a cco u n t s
2 9 	 r e tir emen t 	 bene fit 	 s cheme s 	continued
a ct uarial 	 gains 	 and 	 lo s s e s 	 ha v e 	 been 	 included 	 in 	 the 	 s t at emen t 	 o f 	 c ompr ehensiv e 	 inc ome 	 	 	 	 	
amount creditedcharged to net finance costs
a t 	 3 1	
dec ember
2 010
£m
a t 	 3 1	
dec ember
2 009
£m
expect ed 	 r e t urn 	 on 	 s cheme 	 as s e t s 	 1 6  0	 	 1 4  4	
i n t e r est 	 c ost 	 15 6 	 163
	 0 4	 	 1 9
amount recognised in consolidated statement of comprehensive income 
2 010
£m
2 009
£m
a ct ual 	 r e t urn 	 le s s 	 e xpect ed 	 r e t urn 	 on 	 pension 	 as s e t s 	 13 2	 	 21 1	
experienc e 	 gains 	 and 	 lo s s e s 	 3 4	 	 1 7
change s 	 in 	 as sump tions 	 7 5 	 2 7  4
	9 1	 	 8 0
									
t he 	 f air 	 v alue 	 o f 	 the 	 as s e t s 	 in 	 the 	 s cheme s  	 the 	 pr e s en t 	 v alue 	 o f 	 the 	 liabilitie s 	 in 	 the 	 s cheme s 	 and 	 the 	 e xpect ed 	 r at e 	 o f 	 r e t urn 	 at 	 e ach	
b alanc e 	 shee t 	 dat e 	 w as	 	 	 	 	 	 	 	 	
at
3 1 	 dec ember
2 010
£m
at
3 1 	 dec ember
2 009
£m
at
3 1 	 dec ember
2 008
£m
at
3 1 	 dec ember
20 0 7
£m
at
3 1 	 dec ember
2 006
£m
e quitie s 	 13 2 7	 	 12 2 9	 	 1086	 	 143 2	 	 14 5  9	
b onds 	 1 2 9  6	 	 12 0  9	 	 1 0 6  7	 	 121 9	 	 1 1 4  7	
f air 	 v alue 	 o f 	 s cheme s ’ 	 as s e t s 	 2 6 2  3	 	 2 4 3  8	 	 2 1 5  3	 	2 6 5 1	 	 2 60 6	
pr e s en t 	 v alue 	 o f 	 de fined 	 bene fit 	 obligations 	 2 8 5 2 	 2 7 9 8 	 2 5 3 6 	 2 7 9  1 	 3 0 7 3
de ficit 	 in 	 the 	 s cheme s 	 2 2 9 	 3 6 0 	 3 83 	 14  0 	 46 7
e quitie s 8 0 8 0 8 0 8 0 8  4
b onds 4 2– 	 5 6  4 5 – 	 5  7  3  7 – 	 66  4  4 – 	 6 1 4 6 – 	 5 2
									
a 	 r elat ed 	 o f f s e t ting 	 de f err ed 	 t ax 	 as s e t 	 o f 	 £ 6 7m 	 2 009 	 £10 3m  	 is 	 included 	 under 	 non–c urr en t 	 as s e t s  	 t her e f or e 	 the 	 ne t 	 pension	
s cheme 	 de ficit 	 amoun t s 	 t o 	 £162m 	 at 	 3 1 	 dec ember 	 2 010 	 £2 5  7m 	 at 	 3 1 	 dec ember 	 2 009	 	 	 	 	
t he 	 mo v emen t 	 in 	 the 	 aggr egat e 	 s cheme 	 de ficit s 	 during 	 the 	 y e ar 	 w as 	 princip ally 	 due 	 t o 	 the 	 f a v our able 	 mo v emen t 	 in 	 as s e t 	 v alue s 	
								
t he 	 mo v emen t 	 in 	 the 	 f air 	 v alue 	 o f 	 the 	 s cheme s ’ 	 as s e t s 	 during 	 the 	 y e ar 	 is 	 sho wn 	 as 	 f ollo w s	 	 	 	 	
2 010
£m
2 009
£m
a t 	 1 	 january 	 2 4 3  8	 	 2 1 5  3	
expect ed 	 r e t urn 	 on 	 plan 	 as s e t s 	 1 6  0	 	 1 4  3	
a ct uarial 	 gains lo s s e s  	 13 2	 	 21 1	
emplo y er 	 c on tributions 	 6  0	 	 9  0	
emplo y ee 	 c on tributions 	0 1	 	 0  3	
b ene fit s 	 p aid 	 fr om 	 plan 	 c omp an y 	 168 	 162
a t 	 3 1 	 dec ember	 	 2 6 2  3	 	 2 4 3  8	
									
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 87
mo v emen t 	 in 	 the 	 de fined 	 bene fit 	 obligation 	 is 	 as 	 f ollo w s	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
a t 	 1 	 january 	 2 7 9  8	 	 2 53 6	
c urr en t 	 s ervic e 	 c o s t 	 2 4	 	 1  0	
i n t e r est 	 c ost 	 1 5  6	 	 1 6  3	
c on tributions 	 fr om 	 plan 	 p ar ticip an t s 	0 1	 	 0  3	
p as t 	 s ervic e 	 c o s t – 	 4 3
a ct uarial 	 lo s s e s  gain  	4 1	 	2 9 1	
b ene fit s 	 p aid 	 fr om 	 plan 	 c omp an y 	 168 	 162
a t 	 3 1 	 dec ember	 	 2 8 5 2	 	 2 7 9  8	
t he 	 act ual 	 r e t urn 	 on 	 plan 	 as s e t s 	 f or 	 the 	 y e ar 	 w as 	 £2 9 2m 	 2 009 	 £3 5  4m 
history of experience gains and losses
at
3 1 	 dec ember
2 010
at
3 1 	 dec ember
2 009
at
3 1 	 dec ember
2 008
at
3 1 	 dec ember
20 0 7
at
3 1 	 dec ember
2 006
dif f er enc e 	 be t w een 	 the 	 e xpect ed 	 and 	 act ual 	 r e t urn	 	
on 	 s cheme 	 as s e t s
amoun t 	 £m  	 13 2 	 21 1	 	 5 82 	 82 	 1 9
p er c en t age 	 o f 	 s cheme 	 as s e t s 5  9  27  3  1
experienc e 	 gains 	 and 	 lo s s e s 	 on 	 s cheme 	 liabilitie s
amoun t 	 £m  	 3 4	 	 1 7 	 2 8 0 	 3 2 9 	 7  1
p er c en t age 	 o f 	 the 	 pr e s en t 	 v alue 	 o f 	 s cheme 	 liabilitie s 1 10 11 12 2
t o t a l 	 a m o u n t 	 r e c o g n i s e d 	 i n 	 s t a t e m e n t 	 o f 	 r e c o g n i s e d	 	
inc ome 	 and 	 e xpens e
amoun t 	 £m  	9 1	 	 8 0 	 3 0 2 	 2 4  7	 	4 1	
p er c en t age 	 o f 	 the 	 pr e s en t 	 v alue 	 o f 	 s cheme 	 liabilitie s 3 3  16  9 1
										
t he 	 e s timat ed 	 amoun t 	 o f 	 c on tributions 	 e xpect ed 	 t o 	 be 	 p aid 	 t o 	 the 	 s cheme s 	 during 	 2 011 	 is 	 £5 2m	 	 	 	
3 0 	 shar e–b as ed 	 p a ymen t s	 	 	 	 	 	 	 	 	 	
	
 equity–settled share option plans         
t her e 	 ar e 	 no 	 c omp an y 	 shar e 	 op tions 	 out s t anding 	 at 	 3 1 	 dec ember 	
c omp an y 	 shar e 	 op tion 	 s cheme
number 	 o f
shar e 	 op tions
2 010
w eigh t ed	
a v er age	
e x er cis e
pric e 	 £
		
number 	 o f
shar e 	 op tions
2 009
w eigh t ed	
a v er age	
e x er cis e
pric e 	 £
out s t anding 	 at 	 1 	 january 	 1 2  6 1 4	 	 5 7  2 0	 17 8 7 4 	 5 1 7 9	
e x p i r e d	 	 1 2  6 1 4	 	 5 7  2 0	 5 2 60 	 3 86 9	
out s t anding 	 at 	 3 1 	 dec ember –	 –	 	 1 2  6 1 4	 	 5 7  2 0	
ex er cis able 	 at 	 3 1 	 dec ember –	 –	 –	 –	
	
t he 	 c omp an y 	 s cheme 	 op tions 	 out s t anding 	 at 	 3 1 	 dec ember 	 2 010 	 ha v e 	 a 	 w eigh t ed 	 a v er age 	 e x er cis e 	 pric e 	 o f 	 £nil 	 2 009 	 £5 7 2 0 	 and 	 a	
w eigh t ed 	 a v er age 	 r emaining 	 c on tr act ual 	 lif e 	 o f 	 nil 	 2 009 	 nil 	 mon ths  	 	 	 	 	 	 	 	 annual report and accounts 2010
a cco u n t s
3 0 	 shar e–b as ed 	 p a ymen t s 	continued									
t he 	 f air 	 v alue 	 o f 	 the 	 abo v e 	 c omp an y 	 shar e 	 op tion 	 s cheme 	 w as 	 c alc ulat ed 	 using 	 the 	 b lack 	  	 s chole s 	 model 	 expect ed 	 v olatilit y 	 w as	
de t ermined 	 b y 	 c alc ulating 	 the 	 his t oric al 	 v olatilit y 	 o f 	 the 	 gr oup ’ s 	 shar e 	 pric e 	 o v er 	 the 	 pr e vious 	 thr ee 	 y e ar s  	 expect ed 	 lif e 	 is 	 the 	 a v er age	
e xpect ed 	 period 	 t o 	 e x er cis e  	 t he 	 risk –fr ee 	 r at e 	 is 	 the 	 yield 	 on 	 z er o–c oupon 	 uk 	 go v ernmen t 	 bonds 	 o f 	 a 	 t erm 	 c onsis t en t 	 with 	 the	
as sumed 	 op tion 	 lif e  	 expect ed 	 dividend 	 yield 	 is 	 b as ed 	 on 	 the 	 a v er age 	 dividend 	 yield 	 o v er 	 the 	 pr e vious 	 thr ee 	 y e ar s 	 prior 	 t o 	 the 	 a w ar d
no 	 ne w 	 a w ar ds 	 w er e 	 made 	 during 	 2 009 	 and 	 2 010  	 	 	 	 	 	 	 	 	 	
 other share–based payment plans         
t he 	 long–t erm 	 inc en tiv e 	 plan 	 is 	 f or 	 e x ec utiv e 	 dir ect or s 	 and 	 o ther 	 s enior 	 e x ec utiv e s  	 t he 	 perf ormanc e 	 crit eria 	 f or 	 this 	 s cheme 	 ar e	
b as ed 	 on 	 a 	 c ombination 	 o f 	 e arnings 	 gr o wth 	 and 	 t o t al 	 shar eholder 	 r e t urn 	 and 	 as 	 such 	 ha v e 	 been 	 v alued 	 using 	 bo th 	 b lack 	  	 s chole s	
and 	 mon t e 	 c arlo 	 models 	 r e spectiv ely  	 	 	 	 	 	 	 	 	 	
p ar ticip an t s 	 in 	 the 	 2 009 	 l tip 	 ha v e 	 been 	 gr an t ed 	 unit s 	 which 	 ha v e 	 no 	 v alue 	 on 	 the 	 dat e 	 o f 	 gr an t 	 but 	 ha v e 	 the 	 po t en tial 	 t o 	 c on v er t	
in t o 	 nil–c o s t 	 op tions 
3 1	 financial 	 ins trumen t s
	
 capital risk management
t he 	 gr oup ’ s 	 objectiv e s 	 when 	 managing 	 c apit al 	 ar e 	 t o 	 s af eguar d 	 the 	 gr oup ’ s 	 abilit y 	 t o 	 c on tinue 	 as 	 a 	 going 	 c onc ern 	 in 	 or der 	 t o 	 pr o vide	
r e t urns 	 f or 	 shar eholder s 	 and 	 bene fit s 	 f or 	 o ther 	 s t ak eholder s 	 and 	 t o 	 main t ain 	 an 	 op timal 	 c apit al 	 s truct ur e 	 t o 	 r educ e 	 the 	 c o s t 	 o f 	 c apit al
t he 	 c apit al 	 s truct ur e 	 o f 	 the 	 c omp an y 	 c onsis t s 	 o f 	 deb t  	 which 	 include s 	 the 	 b ank 	 lo ans 	 dis clo s ed 	 in 	 no t e 	 2 0  	 c ash 	 and 	 c ash 	 equiv alen t s	
a n d 	 e q u i t y 	 a t t r i b u t a b l e 	 t o 	 e q u i t y 	 h o l d e r s 	 o f 	 t h e 	 p a r e n t  	 c o m p r i s i n g 	 i s s u e d 	 s h a r e 	 c a p i t a l  	 r e s e r v e s 	 a n d 	 r e t a i n e d 	 e a r n i n g s 	
t he 	 gr oup 	 monit or s 	 c apit al 	 on 	 the 	 b asis 	 o f 	 the 	 ge aring 	 r atio 
	 ge aring 	 r atio
t his 	 r atio 	 is 	 c alc ulat ed 	 as 	 ne t 	 deb t 	 divided 	 b y 	 t o t al 	 c apit al	 	 	 	 	 	 	 	
2 010
£m
2 009
£m
t o t al 	 borr o wings 	  no t e 	 2 0 	 5 9  9	 	 6 7 5	
c ash 	 and 	 c ash 	 equiv alen t s	 	 7  7 	 18 1
ne t 	 deb t 	 5 22	 	 4 9  4	
t o t al 	 equit y 	 19 8 	 3 1 9
t o t al 	 c apit al 	 3 2 4	 	 17 5	
ge aring 	 r atio 16 1 28 2
											
c ash 	 and 	 c ash 	 equiv alen t s 	 include s 	 c ash 	 held 	 within 	 dis c on tinued 	 oper ations 	 and 	 shor t 	 t erm 	 depo sit s 	 	 	 	
	covenants										
t he 	 gr oup 	 is 	 subject 	 t o 	 thr ee 	 financial 	 c o v enan t s 	 in 	 r e spect 	 o f 	 it s 	 c ommit t ed 	 borr o wing 	 f acilitie s 	 at 	 the 	 b alanc e 	 shee t 	 dat e  	 t he 	 t erms 	
o f 	 t h e 	 f a c i l i t y 	 a g r e e m e n t 	 c o n t a i n 	 t h e 	 f o l l o w i n g 	 c o v e n a n t s 	  i  	 t h e 	 r a t i o 	 o f 	 a v e r a g e 	 n e t 	 d e b t 	 t o 	 a d j u s t e d 	 e a r n i n g s 	 b e f o r e 	 i n t e r e s t  	 t a x 	
depr eciation 	 and 	 amor tis ation 	 ebitd a  	 and 	 ii 	 the 	 r atio 	 o f 	 adjus t ed 	 ebitd a 	 t o 	 c ash 	 in t er e s t  	 bo th 	 o f 	 which 	 ar e 	 t e s t ed 	 quar t erly  	 and	
iii 	 the 	 r atio 	 o f 	 adjus t ed 	 ebitd a 	 t o 	 b alanc e 	 shee t 	 ne t 	 deb t 	 which 	 is 	 t e s t ed 	 annually  	 t he 	 gr oup 	 c omplied 	 with 	 all 	 the 	 c o v enan t s 	 in	
e ach 	 o f 	 the 	 t e s t 	 periods 	 t o 	 the 	 b alanc e 	 shee t 	 dat e 
 financial risk management objectives
t h e 	 g r o u p ’ s 	 a c t i v i t i e s 	 e x p o s e 	 i t 	 t o 	 a 	 v a r i e t y 	 o f 	 fi n a n c i a l 	 r i s k s  	 c u r r e n c y 	 r i s k  	 c r e d i t 	 r i s k  	 l i q u i d i t y 	 r i s k 	 a n d 	 c a s h 	 fl o w 	 i n t e r e s t 	 r a t e 	 r i s k 	
t he 	 gr oup ’ s 	 o v er all 	 risk 	 managemen t 	 pr ogr amme 	 f oc us e s 	 on 	 the 	 unpr edict abilit y 	 o f 	 financial 	 mark e t s 	 and 	 s eek s 	 t o 	 minimis e 	 po t en tial 	
adv er s e 	 e f f ect s 	 on 	 the 	 gr oup ’ s 	 financial 	 perf ormanc e  	 t he 	 gr oup 	 us e s 	 deriv ativ e 	 financial 	 ins trumen t s 	 t o 	 hedge 	 c er t ain 	 risk 	 e xpo sur e s 
no t e s 	 t o 	 the 	 financial 	 s t at emen t s
continued 89
risk 	 managemen t 	 is 	 c arried 	 out 	 b y 	 a 	 c en tr al 	 tr e asury 	 dep ar tmen t 	  gr oup 	 t r e asury  	 under 	 policie s 	 appr o v ed 	 b y 	 the 	 b o ar d 	 o f	
d i r e c t o r s  	 g r o u p 	 t r e a s u r y 	 i d e n t i fi e s  	 e v a l u a t e s 	 a n d 	 h e d g e s 	 fi n a n c i a l 	 r i s k s 	 i n 	 c l o s e 	 c o – o p e r a t i o n 	 w i t h 	 t h e 	 g r o u p ’ s 	 o p e r a t i n g 	 d i v i s i o n s 	
t he 	 b o ar d 	 pr o vide s 	 writ t en 	 principle s 	 f or 	 o v er all 	 risk 	 managemen t  	 as 	 w ell 	 as 	 writ t en 	 policie s 	 c o v ering 	 specific 	 ar e as  	 such 	 as 	 f or eign 	
e x change 	 risk 	 in t er e s t 	 r at e 	 risk 	 cr edit 	 risk 	 us e 	 o f 	 financial 	 ins trumen t s 	 and 	 in v e s ting 	 e x c e s s 	 liquidit y 	 	 	 	
						
 currency risk          
t he 	 gr oup 	 oper at e s 	 almo s t 	 wholly 	 within 	 the 	 uk 	 and 	 is 	 e xpo s ed 	 t o 	 minimal 	 f or eign 	 e x change 	 risk 	 f or eign 	 c urr enc y 	 e x change 	 risk	
aris e s 	 primarily 	 with 	 r e spect 	 t o 	 the 	 e ur o  	 us 	 dollar 	 and 	 the 	 s wis s 	 fr anc 	 f or eign 	 c urr enc y 	 e x change 	 risk 	 aris e s 	 fr om 	 fut ur e 	 c ommer cial	
tr ans actions 	 and 	 tr ade 	 as s e t s 	 and 	 liabilitie s 	 in 	 f or eign 	 c urr encie s  	 no 	 fur ther 	 activ e 	 managemen t 	 o f 	 c urr enc y 	 risk 	 is 	 r equir ed
t he 	 gr oup 	 has 	 minimal 	 e xpo sur e 	 t o 	 f or eign 	 e x change 	 risk 	 and 	 it 	 is 	 gr oup 	 polic y 	 t o 	 ensur e 	 that 	 all 	 mat erial 	 p a ymen t s 	 or 	 r ec eip t s	 	
ar e 	 fully 	 hedged 	 a t 	 3 1 	 dec ember 	 2 010 	 the 	 gr oup 	 had 	 no 	 f orw ar d 	 f or eign 	 e x change 	 c on tr act s 	 in 	 plac e 	 2 009 	 nil
 credit risk          
c r e d i t 	 r i s k 	 i s 	 t h e 	 r i s k 	 o f 	 l o s s e s 	 d u e 	 t o 	 t h e 	 f a i l u r e 	 o f 	 t h e 	 g r o u p ’ s 	 c u s t o m e r s 	 t o 	 m e e t 	 t h e i r 	 p a y m e n t 	 o b l i g a t i o n s 	 t o w a r d s 	 t h e 	 g r o u p 	 	
t he 	 gr oup 	 has 	 no 	 signific an t 	 c onc en tr ation 	 o f 	 cr edit 	 risk 	 it 	 has 	 policie s 	 in 	 plac e 	 t o 	 ensur e 	 that 	 s ale s 	 ar e 	 made 	 t o 	 c us t omer s 	 with 	 an 	
appr opriat e 	 cr edit 	 his t ory  	 independen t 	 cr edit 	 r atings 	 ar e 	 s ough t 	 f or 	 all 	 po t en tial 	 c us t omer s 	 and 	 b as ed 	 on 	 the 	 out c ome 	 o f 	 the	
f eedb ack 	 fr om 	 the 	 r atings 	 agenc y 	 a 	 judgemen t 	 is 	 made 	 on 	 the 	 appr opriat e 	 le v el 	 o f 	 cr edit 	 t o 	 be 	 giv en 	 deriv ativ e 	 tr ans action	
c oun t erp ar tie s 	 ar e 	 limit ed 	 t o 	 high–cr edit –qualit y 	 financial 	 ins tit utions 	 	 	 	 	 	 	
 liquidity risk          
liquidit y 	 risk 	 is 	 the 	 risk 	 that 	 the 	 gr oup 	 will 	 be 	 unable 	 t o 	 mee t 	 it s 	 p a ymen t 	 obligations  	 pruden t 	 liquidit y 	 managemen t 	 implie s	
main t aining 	 suf ficien t 	 c ash 	 and 	 mark e t able 	 s ec uritie s  	 the 	 a v ailabilit y 	 o f 	 funding 	 thr ough 	 an 	 adequat e 	 amoun t 	 o f 	 c ommit t ed 	 cr edit 	
f acilitie s 	 and 	 the 	 abilit y 	 t o 	 clo s e 	 out 	 mark e t 	 po sitions  	 due 	 t o 	 the 	 nat ur e 	 o f 	 the 	 underlying 	 busine s s  	 gr oup 	 t r e asury 	 aims 	 t o 	 main t ain	
fle xibilit y 	 in 	 funding 	 b y 	 k eeping 	 c ommit t ed 	 cr edit 	 line s 	 a v ailable 
managemen t 	 monit or s 	 r olling 	 f or ec as t s 	 o f 	 the 	 gr oup ’ s 	 liquidit y 	 r e s erv e 	  c ompris e s 	 o f 	 the 	 undr a wn 	 borr o wing 	 f acilit y 	  no t e 	 2 0 	 and	
c a s h 	 a n d 	 c a s h 	 e q u i v a l e n t s 	  n o t e 	 1 8   	 o n 	 t h e 	 b a s i s 	 o f 	 e x p e c t e d 	 c a s h 	 fl o w  	 t h i s 	 i s 	 g e n e r a l l y 	 c a r r i e d 	 o u t 	 a t 	 a 	 g r o u p 	 l e v e l  	 i n 	 a d d i t i o n 	 	
the 	 gr oup ’ s 	 liquidit y 	 managemen t 	 polic y 	 include s 	 pr ojecting 	 c ash 	 flo w s 	 and 	 c onsidering 	 the 	 le v el 	 o f 	 liquid 	 as s e t s 	 nec e s s ary 	 t o 	 mee t 	
the s e 	 monit oring 	 b alanc e 	 shee t 	 liquidit y 	 r atio s 	 agains t 	 in t ernal 	 t ar ge t s 	 and 	 b ank 	 f acilit y 	 r equir emen t s 	 and 	 main t aining 	 deb t	
financing 	 plans 	 	 	 	 	 	 	 	 	 	
										
 cash flow interest rate risk
as 	 the 	 gr oup 	 has 	 no 	 signific an t 	 in t er e s t 	 be aring 	 as s e t s  	 the 	 gr oup ’ s 	 inc ome 	 and 	 oper ating 	 c ash 	 flo w s 	 ar e 	 sub s t an tially 	 independen t 	
o f 	 change s 	 in 	 mark e t 	 in t er e s t 	 r at e s 	 	 	 	 	 	 	 	 	 	
										
t he 	 gr oup ’ s 	 in t er e s t 	 r at e 	 risk 	 aris e s 	 fr om 	 long–t erm 	 borr o wings  	 b orr o wings 	 is sued 	 at 	 shor t 	 t erm 	 fix ed 	 r at e s 	 e xpo s e 	 the 	 gr oup 	 	
t o 	 c ash 	 flo w 	 in t er e s t 	 r at e 	 risk 	 gr oup 	 polic y 	 is 	 t o 	 main t ain 	 be t w een 	 40 	 and 	 60 	 o f 	 it s 	 borr o wings 	 in 	 fix ed 	 r at e 	 ins trumen t s 	 	
								
a 	 mon thly 	 s ensitivit y 	 analy sis 	 is 	 c arried 	 out  	 and 	 on 	 the 	 le v el 	 o f 	 borr o wings 	 o f 	 the 	 gr oup 	 at 	 3 1 	 dec ember 	 2 010  	 a 	 mo v emen t 	 o f 	 0 2 5 	
in 	 in t er e s t 	 r at e s 	 w ould 	 change 	 the 	 le v el 	 o f 	 in t er e s t 	 p aid 	 in 	 the 	 y e ar 	 b y 	 – 	 £ 0  1m 	 2 009 	 £ 0 2m 	 	 	 	 	
t he 	 gr oup 	 manage s 	 it s 	 c ash 	 flo w 	 in t er e s t 	 r at e 	 risk 	 b y 	 using 	 flo ating–t o–fix ed 	 in t er e s t 	 r at e 	 s w ap s  	 s uch 	 in t er e s t 	 r at e 	 s w ap s 	 ha v e 	 	
the 	 ec onomic 	 e f f ect 	 o f 	 c on v er ting 	 borr o wing 	 fr om 	 flo ating 	 r at e s 	 t o 	 fix ed 	 r at e s  	 gener ally  	 the 	 gr oup 	 r ais e s 	 long 	 t erm 	 borr o wings 	 at 	
flo ating 	 r at e s 	 and 	 s w ap s 	 them 	 in t o 	 fix ed 	 r at e s 	 that 	 ar e 	 lo w er 	 than 	 tho s e 	 a v ailable 	 if 	 the 	 gr oup 	 borr o w ed 	 at 	 fix ed 	 r at e 	 dir ectly  	 under 	
the 	 in t er e s t 	 r at e 	 s w ap s  	 the 	 gr oup 	 agr ee s 	 with 	 o ther 	 p ar tie s 	 t o 	 e x change  	 at 	 specific 	 in t erv als 	  mainly 	 quar t erly  	 the 	 dif f er enc e 	
b e t w e e n 	 fi x e d 	 c o n t r a c t 	 r a t e s 	 a n d 	 fl o a t i n g 	 r a t e 	 i n t e r e s t 	 a m o u n t s 	 c a l c u l a t e d 	 b y 	 r e f e r e n c e 	 t o 	 t h e 	 a g r e e d 	 n o t i o n a l 	 p r i n c i p a l 	 a m o u n t s 	 	
an 	 in t er e s t 	 r at e 	 s w ap 	 w as 	 en t er ed 	 in t o 	 on 	 3 1 	 dec ember 	 2 010 	 f or 	 a 	 period 	 o f 	 12 	 mon ths 	 	 	 	 	 	
 embedded derivatives          
in 	 ac c or danc e 	 with 	 ia s 	 3 9  	 financial 	 ins trumen t s 	 r ec ognition 	 and 	 me asur emen t  	 the 	 gr oup 	 has 	 r e vie w ed 	 an y 	 c on tr act s 	 f or	
embedded 	 deriv ativ e s 	 that 	 ar e 	 r equir ed 	 t o 	 be 	 s ep ar at ely 	 ac c oun t ed 	 f or 	 if 	 the y 	 do 	 no t 	 mee t 	 c er t ain 	 r equir emen t s 	 s e t 	 out 	 in	 	
the 	 s t andar d 	 t he 	 gr oup 	 had 	 no 	 such 	 embedded 	 deriv ativ e s 	 during 	 the 	 y e ar  annual report and accounts 2010
a cco u n t s
w e 	 ha v e 	 audit ed 	 the 	 p ar en t 	 c omp an y 	 financial 	 s t at emen t s 	 o f 	 s tv 	 gr oup 	 plc 	 f or 	 the 	 y e ar 	 ended 	 3 1 	 dec ember 	 2 010 	 which 	 c ompris e 	 the 	
b alanc e 	 shee t  	 s t at emen t 	 o f 	 t o t al 	 r ec ognis ed 	 gains 	 and 	 lo s s e s 	 and 	 the 	 r elat ed 	 no t e s  	 t he 	 financial 	 r epor ting 	 fr ame w ork 	 that 	 has 	 been 	
applied 	 in 	 their 	 pr ep ar ation 	 is 	 applic able 	 la w 	 and 	 unit ed 	 kingdom 	 a c c oun ting 	 s t andar ds 	 unit ed 	 kingdom 	 gener ally 	 a c c ep t ed 	 a c c oun ting	
pr actic e 
r e spectiv e 	 r e sponsibilitie s 	 o f 	 dir ect or s 	 and 	 audit or s
as 	 e xplained 	 mor e 	 fully 	 in 	 the 	 s t at emen t 	 o f 	 dir ect or s ’ 	 r e sponsibilitie s 	 s e t 	 out 	 on 	 p age 	 2 6 	 the 	 dir ect or s 	 ar e 	 r e sponsible 	 f or 	 the	
pr ep ar ation 	 o f 	 the 	 p ar en t 	 c omp an y 	 financial 	 s t at emen t s 	 and 	 f or 	 being 	 s atis fied 	 that 	 the y 	 giv e 	 a 	 true 	 and 	 f air 	 vie w  	 our 	 r e sponsibilit y 	 is 	 t o 	
audit 	 and 	 e xpr e s s 	 an 	 opinion 	 on 	 the 	 p ar en t 	 c omp an y 	 financial 	 s t at emen t s 	 in 	 ac c or danc e 	 with 	 applic able 	 la w 	 and 	 in t ernational 	 s t andar ds 	
o n 	 a u d i t i n g 	  u k 	 a n d 	 i r e l a n d   	 t h o s e 	 s t a n d a r d s 	 r e q u i r e 	 u s 	 t o 	 c o m p l y 	 w i t h 	 t h e 	 a u d i t i n g 	 p r a c t i c e s 	 b o a r d ’ s 	 e t h i c a l 	 s t a n d a r d s 	 f o r 	 a u d i t o r s 	
t his 	 r epor t  	 including 	 the 	 opinions  	 has 	 been 	 pr ep ar ed 	 f or 	 and 	 only 	 f or 	 the 	 c omp an y’ s 	 member s 	 as 	 a 	 body 	 in 	 ac c or danc e 	 with 	 chap t er 	 3 	 o f	
p ar t 	 16 	 o f 	 the 	 c omp anie s 	 a ct 	 2 006 	 and 	 f or 	 no 	 o ther 	 purpo s e  	 w e 	 do 	 no t  	 in 	 giving 	 the s e 	 opinions  	 ac c ep t 	 or 	 as sume 	 r e sponsibilit y 	 f or 	 an y	
o ther 	 purpo s e 	 or 	 t o 	 an y 	 o ther 	 per s on 	 t o 	 whom 	 this 	 r epor t 	 is 	 sho wn 	 or 	 in t o 	 who s e 	 hands 	 it 	 ma y 	 c ome 	 s a v e 	 wher e 	 e xpr e s sly 	 agr eed 	 b y 	 our	
prior 	 c ons en t 	 in 	 writing
s c ope 	 o f 	 the 	 audit 	 o f 	 the 	 financial 	 s t at emen t s
an 	 audit 	 in v olv e s 	 ob t aining 	 e videnc e 	 about 	 the 	 amoun t s 	 and 	 dis clo sur e s 	 in 	 the 	 financial 	 s t at emen t s 	 suf ficien t 	 t o 	 giv e 	 r e as onable 	
as sur anc e 	 that 	 the 	 financial 	 s t at emen t s 	 ar e 	 fr ee 	 fr om 	 mat erial 	 mis s t at emen t  	 whe ther 	 c aus ed 	 b y 	 fr aud 	 or 	 err or  	 t his 	 include s 	 an 	
as s e s smen t 	 o f  	 whe ther 	 the 	 ac c oun ting 	 policie s 	 ar e 	 appr opriat e 	 t o 	 the 	 p ar en t 	 c omp an y’ s 	 cir c ums t anc e s 	 and 	 ha v e 	 been 	 c onsis t en tly	
applied 	 and 	 adequat ely 	 dis clo s ed 	 the 	 r e as onablene s s 	 o f 	 signific an t 	 ac c oun ting 	 e s timat e s 	 made 	 b y 	 the 	 dir ect or s 	 and 	 the 	 o v er all 	
pr e s en t ation 	 o f 	 the 	 financial 	 s t at emen t s 
opinion 	 on 	 financial 	 s t at emen t s
in 	 our 	 opinion 	 the 	 p ar en t 	 c omp an y 	 financial 	 s t at emen t s
•	 giv e 	 a 	 true 	 and 	 f air 	 vie w 	 o f 	 the 	 s t at e 	 o f 	 the 	 c omp an y’ s 	 af f air s 	 as 	 at 	 3 1 	 dec ember 	 2 010	 	 	 	 	 	
•	 ha v e 	 been 	 pr operly 	 pr ep ar ed 	 in 	 ac c or danc e 	 with 	 unit ed 	 kingdom 	 gener ally 	 a c c ep t ed 	 a c c oun ting 	 pr actic e 	 and	
• 	 h a v e 	 b e e n 	 p r e p a r e d 	 i n 	 a c c o r d a n c e 	 w i t h 	 t h e 	 r e q u i r e m e n t s 	 o f 	 t h e 	 c o m p a n i e s 	 a c t 	 2 0 0 6 	
s tv 	 gr oup 	 plc 	 c omp an y 	 financial 	 s t at emen t s
independent auditors’ report to the members of stv group plc 91
opinion 	 on 	 o ther 	 mat t er s 	 pr e s cribed 	 b y 	 the 	 c omp anie s 	 a ct 	 2 006
i n 	 o u r 	 o p i n i o n 	
•	 	 the 	 p ar t 	 o f 	 the 	 r emuner ation 	 c ommit t ee 	 r epor t 	 t o 	 be 	 audit ed 	 has 	 been 	 pr operly 	 pr ep ar ed 	 in 	 ac c or danc e 	 with 	 the 	 c omp anie s 	 a ct	
2 006 	 and	
•	 	 the 	 in f ormation 	 giv en 	 in 	 the 	 dir ect or s ’ 	 r epor t 	 f or 	 the 	 financial 	 y e ar 	 f or 	 which 	 the 	 p ar en t 	 c omp an y 	 financial 	 s t at emen t s 	 ar e 	 pr ep ar ed 	 	
is 	 c onsis t en t 	 with 	 the 	 p ar en t 	 c omp an y 	 financial 	 s t at emen t s  	 	 	 	 	 	 	 	 	
	 	
mat t er s 	 on 	 which 	 w e 	 ar e 	 r equir ed 	 t o 	 r eport 	 b y 	 e x c ep tion
w e 	 h a v e 	 n o t h i n g 	 t o 	 r e p o r t 	 i n 	 r e s p e c t 	 o f 	 t h e 	 f o l l o w i n g 	 m a t t e r s 	 w h e r e 	 t h e 	 c o m p a n i e s 	 a c t 	 2 0 0 6 	 r e q u i r e s 	 u s 	 t o 	 r e p o r t 	 t o 	 y o u 	 i f 	 	
in 	 our 	 opinion 	 	 	 	 	 	 	 	 	 	 	
										
•	 	 adequat e 	 ac c oun ting 	 r ec or ds 	 ha v e 	 no t 	 been 	 k ep t 	 b y 	 the 	 p ar en t 	 c omp an y  	 or 	 r e t urns 	 adequat e 	 f or 	 our 	 audit 	 ha v e 	 no t 	 been 	 r ec eiv ed	
fr om 	 br anche s 	 no t 	 visit ed 	 b y 	 us 	 or	
•	 	 the 	 p ar en t 	 c omp an y 	 financial 	 s t at emen t s 	 and 	 the 	 p ar t 	 o f 	 the 	 r emuner ation 	 c ommit t ee 	 r epor t 	 t o 	 be 	 audit ed 	 ar e 	 no t 	 in 	 agr eemen t 	 	
with 	 the 	 ac c oun ting 	 r ec or ds 	 and 	 r e t urns 	 or	
•	 c er t ain 	 dis clo sur e s 	 o f 	 dir ect or s ’ 	 r emuner ation 	 specified 	 b y 	 la w 	 ar e 	 no t 	 made 	 or 	
•	 w e 	 ha v e 	 no t 	 r ec eiv ed 	 all 	 the 	 in f ormation 	 and 	 e xplanations 	 w e 	 r equir e 	 f or 	 our 	 audit 
other 	 mat t er 	 	 	 	 	 	 	 	 	 	 	
w e 	 ha v e 	 r epor t ed 	 s ep ar at ely 	 on 	 the 	 c ons olidat ed 	 financial 	 s t at emen t s 	 o f 	 s tv 	 gr oup 	 plc 	 f or 	 the 	 y e ar 	 ended 	 3 1 	 dec ember 	 2 010 
alan 	 w ils on 	  s enior 	 s t at ut or y 	 a udit or 
f or 	 and 	 on 	 behalf 	 o f 	 pric e w at erhous ec ooper s 	 llp
char t er ed 	 a c c oun t an t s 	 and 	 s t at ut ory 	 a udit or s
glas go w
2 4 	 f ebruary 	 2 011 annual report and accounts 2010
a cco u n t s
n o te
2 010
£m
2 009
£m
fix ed 	 as s e t s
in v e s tmen t s 2 	 2 7  3	 	 2 5 0  8	
c urr en t 	 as s e t s
deb t or s	
–due 	 within 	 one 	 y e ar 3 	 7 8  0	 	 8 0  3	
–due 	 aft er 	 one 	 y e ar 3 	 1112	 	 4 2	
c ash 	 at 	 b ank 	 and 	 in 	 hand 	0 1	 	 0 2	
c ash 	 in 	 es cr o w 	0 1	 	 0 5	
	 18 9  4	 	 8 5 2	
cr edit or s 	 amoun t s 	 f alling 	 due 	 within 	 one 	 y e ar
other 	 cr edit or s 4 	 3 18 	 9  1
b ank 	 lo ans 5 	 5  0 	 6 7 5
	 3 68 	 7 66
ne t 	 c urr en t 	 as s e t s 	 1 5 2  6	 	 86	
t o t al 	 as s e t s 	 le s s 	 c urr en t 	 liabilitie s 	 1 7 9  9	 	 2 5 9  4	
cr edit or s 	 amoun t s 	 f alling 	 due 	 aft er 	 mor e 	 than 	 one 	 y e ar
b ank 	 lo ans 5 	 54  9 –	
other 	 cr edit or s 6 – 	 13 6 0
ne t 	 as s e t s 	 e x cluding 	 pension 	 liabilit y 	 1 2 5  0	 	 1 2 3  4	
p ension 	 liabilit y 9 	 10  7 –
ne t 	 as s e t s 	 including 	 pension 	 liabilit y 	 1 1 4  3	 	 1 2 3  4	
c apit al 	 and 	 r e s er v e s
c alled 	 up 	 shar e 	 c apit al 7 	 19 2	 	 1 8  3	
shar e 	 pr emium 	 ac c oun t 7 	 111 4	 	 1 1 1  3	
pr o fit 	 and 	 lo s s 	 r e s erv e s 7 	 17  1 	 6 7
other 	 r e s erv e 7 	 0  8	 	 0 5	
t o t al 	 equit y 	 shar eholder s ’ 	 funds 	 1 1 4  3	 	 1 2 3  4	
t he 	 ac c omp an ying 	 no t e s 	 ar e 	 an 	 in t egr al 	 p ar t 	 o f 	 this 	 b alanc e 	 shee t 
t he 	 c omp an y 	 has 	 elect ed 	 t o 	 t ak e 	 the 	 e x emp tion 	 under 	 s ection 	 408 	 o f 	 the 	 c omp anie s 	 a ct 	 2 006 	 t o 	 no t 	 pr e s en t 	 the 	 p ar en t 	 c omp an y 	 pr o fit 	
and 	 lo s s 	 ac c oun t  	 t he 	 lo s s 	 f or 	 the 	 p ar en t 	 c omp an y 	 f or 	 the 	 y e ar 	 w as 	 £16 1m 	 2 009 	 lo s s 	 £ 40 3m 
t he 	 financial 	 s t at emen t s 	 on 	 p age s 	 9 2 	 t o 	 99 	 w er e 	 appr o v ed 	 b y 	 the 	 b o ar d 	 on 	 2 4 	 f ebruary 	 2 011 	 and 	 w er e 	 signed 	 on 	 it s 	 behalf 	 b y
r ob 	 w oodw ar d	 geor ge 	 w at t
dir ect or	 	 dir ect or
c omp an y 	 b alanc e 	 shee t
at 31 december 2010 93
	
n o te
2 010
£m
2 009
£m
l o s s 	 f or 	 the 	 financial 	 y e ar 	 16 1 40 3
unr e alis ed 	 gain 	 on 	 s ale 	 o f 	 in v e s tmen t 7 171 –
t o t al 	 r ec ognis ed 	 gains lo s s e s  	 in 	 the 	 y e ar 1 0 40 3
s t at emen t 	 o f 	 t o t al 	 r ec ognis ed 	 gains 	 and 	 l o s s e s
f or the year ended 31 december 2010 annual report and accounts 2010
a cco u n t s
1	 a c c oun ting 	 policie s
 accounting convention and basis of preparation
t he 	 s ep ar at e 	 financial 	 s t at emen t s 	 o f 	 the 	 c omp an y 	 ar e 	 pr e s en t ed 	 as 	 r equir ed 	 b y 	 the 	 c omp anie s 	 a ct 	 2 006 	 t he 	 s ep ar at e 	 financial 	
s t at emen t s 	 ha v e 	 been 	 pr ep ar ed 	 in 	 ac c or danc e 	 with 	 all 	 applic able 	 uk 	 a c c oun ting 	 s t andar ds 	 and 	 ha v e 	 been 	 pr ep ar ed 	 c onsis t en tly	
fr om 	 y e ar 	 t o 	 y e ar  	 under 	 the 	 his t oric al 	 c o s t 	 c on v en tion 	 in 	 ac c or danc e 	 with 	 applic able 	 ac c oun ting 	 s t andar ds 	 on 	 a 	 going 	 c onc ern 	 b asis 
 basis of consolidation
a s 	 p e r m i t t e d 	 u n d e r 	 s e c t i o n 	 4 0 8 	 o f 	 t h e 	 c o m p a n i e s 	 a c t 	 2 0 0 6  	 n o 	 s e p a r a t e 	 i n c o m e 	 s t a t e m e n t 	 f o r 	 t h e 	 h o l d i n g 	 c o m p a n y 	 i s 	 p r e s e n t e d 	
t he 	 c ons olidat ed 	 financial 	 s t at emen t s 	 as 	 pr e s en t ed 	 within 	 the 	 annual 	 r epor t 	 include 	 the 	 r e sult s 	 o f 	 s tv 	 gr oup 	 plc  	 the 	 holding 	
c omp an y  	 and 	 all 	 o f 	 it s 	 sub sidiarie s 	 and 	 as s ociat ed 	 under t akings 	 up 	 t o 	 3 1 	 dec ember 	 2 010 
 cash flow statement
a 	 c ash 	 flo w 	 s t at emen t 	 has 	 no t 	 been 	 included 	 within 	 the s e 	 financial 	 s t at emen t s 	 in 	 ac c or danc e 	 with 	 the 	 e x emp tion 	 a v ailable 	 within 	
frs 	 1 	 r e vis ed
 investments
fix ed 	 as s e t 	 in v e s tmen t s 	 ar e 	 s t at ed 	 at 	 c o s t  	 le s s 	 an y 	 pr o vision 	 f or 	 imp airmen t 
 impairment
as s e t s 	 that 	 ar e 	 subject 	 t o 	 amor tis ation 	 or 	 depr eciation 	 ar e 	 r e vie w ed 	 f or 	 imp airmen t 	 whene v er 	 e v en t s 	 or 	 change s 	 in 	 cir c ums t anc e s	
indic at e 	 that 	 the 	 c arrying 	 amoun t 	 ma y 	 no t 	 be 	 r ec o v er able  	 an 	 imp airmen t 	 lo s s 	 is 	 r ec ognis ed 	 in 	 the 	 pr o fit 	 and 	 lo s s 	 ac c oun t 	 f or 	 the 	
amoun t 	 b y 	 which 	 the 	 as s e t ’ s 	 c arrying 	 v alue 	 e x c eeds 	 it s 	 r ec o v er able 	 amoun t 
 share–based payments
t he 	 gr oup 	 is sue s 	 equit y –s e t tled 	 shar e–b as ed 	 p a ymen t s 	 t o 	 c er t ain 	 emplo y ee s  	 e quit y –s e t tled 	 shar e–b as ed 	 p a ymen t s 	 ar e 	 me asur ed	 	
at 	 f air 	 v alue 	 o f 	 the 	 equit y 	 ins trumen t s 	 at 	 the 	 gr an t 	 dat e  	 t he 	 f air 	 v alue 	 e x clude s 	 the 	 e f f ect 	 o f 	 non 	 mark e t –b as ed 	 v e s ting 	 c onditions 
t he 	 f air 	 v alue 	 de t ermined 	 at 	 the 	 gr an t 	 dat e 	 o f 	 the 	 equit y –s e t tled 	 shar e–b as ed 	 p a ymen t s 	 is 	 e xpens ed 	 on 	 a 	 s tr aigh t –line 	 b asis 	 o v er 	 the	
v e s ting 	 period 	 b as ed 	 on 	 the 	 gr oup ’ s 	 e s timat e 	 o f 	 equit y 	 ins trumen t s 	 that 	 will 	 e v en t ually 	 v e s t  	 a t 	 e ach 	 b alanc e 	 shee t 	 dat e  	 the 	 gr oup	
r e vis e s 	 it s 	 e s timat e 	 o f 	 the 	 number 	 o f 	 equit y 	 ins trumen t s 	 e xpect ed 	 t o 	 v e s t 	 as 	 a 	 r e sult 	 o f 	 the 	 e f f ect 	 o f 	 non 	 mark e t –b as ed 	 v e s ting	
c onditions  	 t he 	 imp act 	 o f 	 the 	 r e vision 	 o f 	 the 	 original 	 e s timat e s  	 if 	 an y  	 is 	 r ec ognis ed 	 in 	 pr o fit 	 and 	 lo s s 	 such 	 that 	 the 	 c umulativ e 	
e xpens e 	 r e flect s 	 the 	 r e vis ed 	 e s timat e  	 with 	 a 	 c orr e sponding 	 adjus tmen t 	 t o 	 the 	 equit y –s e t tled 	 emplo y ee 	 bene fit s 	 r e s erv e 
f air 	 v alue 	 is 	 me asur ed 	 b y 	 us e 	 o f 	 the 	 b lack 	  	 s chole s 	 model 	 or 	 mon t e 	 c arlo 	 model 	 as 	 r ele v an t  	 t he 	 e xpect ed 	 liv e s 	 us ed 	 in 	 the 	 model	
ha v e 	 been 	 adjus t ed 	 b as ed 	 on 	 managemen t ’ s 	 be s t 	 e s timat e  	 f or 	 the 	 e f f ect s 	 o f 	 non–tr ans f er abilit y  	 e x er cis e 	 r e s trictions 	 and	
beha viour al 	 c onsider ations 
f ull 	 dis clo sur e 	 o f 	 shar e 	 b as ed 	 p a ymen t 	 a w ar ds 	 is 	 pr o vided 	 within 	 the 	 gr oup 	 financial 	 s t at emen t s 
 dividends
t he 	 liabilit y 	 f or 	 final 	 dividends 	 is 	 r ec or ded 	 when 	 the 	 dividends 	 ar e 	 appr o v ed 	 b y 	 the 	 c omp an y’ s 	 shar eholder s 
f or 	 in t erim 	 dividends  	 the 	 liabilit y 	 is 	 r ec or ded 	 when 	 the 	 dividends 	 ar e 	 p aid
 t axation
c urr en t 	 t ax 	 is 	 pr o vided 	 at 	 amoun t s 	 e xpect ed 	 t o 	 be 	 p aid 	  or 	 r ec o v er ed 	 using 	 the 	 t ax 	 r at e s 	 enact ed 	 or 	 sub s t an tially 	 enact ed 	 b y 	 the	
b alanc e 	 shee t 	 dat e 
de f err ed 	 t ax ation 	 is 	 pr o vided 	 in 	 full 	 on 	 timing 	 dif f er enc e s 	 that 	 r e sult 	 in 	 an 	 obligation 	 at 	 the 	 b alanc e 	 shee t 	 dat e 	 t o 	 p a y 	 mor e 	 t ax 	 or	 	
a 	 righ t 	 t o 	 p a y 	 le s s 	 t ax 	 at 	 a 	 fut ur e 	 dat e  	 at 	 r at e s 	 e xpect ed 	 t o 	 apply 	 when 	 the y 	 cry s t allis e 	 b as ed 	 on 	 c urr en t 	 t ax 	 r at e s 	 and 	 la w  	 t iming	
dif f er enc e s 	 aris e 	 fr om 	 the 	 inclusion 	 o f 	 it ems 	 o f 	 inc ome 	 and 	 e xpendit ur e 	 in 	 t ax 	 c omput ations 	 in 	 periods 	 dif f er en t 	 fr om 	 tho s e 	 in 	 which	
the y 	 ar e 	 included 	 in 	 the 	 financial 	 s t at emen t s  	 de f err ed 	 t ax 	 as s e t s 	 and 	 liabilitie s 	 ar e 	 no t 	 dis c oun t ed
no t e s 	 t o 	 the 	 c omp an y 	 financial 	 s t at emen t s
for the year ended 31 december 2010 95
t he 	 t ax ation 	 liabilitie s 	 o f 	 c er t ain 	 gr oup 	 c omp anie s 	 ar e 	 r educ ed 	 wholly 	 or 	 in 	 p ar t 	 b y 	 lo s s e s 	 surr ender ed 	 b y 	 o ther 	 gr oup 	 c omp anie s 	
t he 	 t ax 	 bene fit s 	 arising 	 fr om 	 gr oup 	 r elie f 	 ar e 	 r ec ognis ed 	 in 	 the 	 ac c oun t s 	 o f 	 the 	 surr endering 	 and 	 r ecipien t 	 c omp anie s 
 bank borrowings
in t er e s t –be aring 	 b ank 	 lo ans 	 and 	 o v er dr aft s 	 ar e 	 initially 	 r ec or ded 	 at 	 the 	 pr oc eeds 	 r ec eiv ed 	 ne t 	 o f 	 dir ect 	 is sue 	 c o s t s  	 t he y 	 ar e	
sub s equen tly 	 me asur ed 	 at 	 amor tis ed 	 c o s t 	 using 	 the 	 e f f ectiv e 	 in t er e s t 	 r at e  	 financ e 	 c o s t s  	 including 	 pr emiums 	 p a y able 	 on 	 s e t tlemen t	
or 	 r edemp tion 	 and 	 dir ect 	 is sue 	 c o s t s  	 ar e 	 ac c oun t ed 	 f or 	 on 	 an 	 ac cruals 	 b asis 	 t o 	 the 	 inc ome 	 s t at emen t 	 and 	 ar e 	 added 	 t o 	 the 	 c arrying	
amoun t 	 o f 	 the 	 ins trumen t 	 t o 	 the 	 e xt en t 	 that 	 the y 	 ar e 	 no t 	 s e t tled 	 in 	 the 	 period 	 in 	 which 	 the y 	 aris e 	 	 	 	
 pension costs
emplo y ee s 	 o f 	 the 	 c omp an y 	 ar e 	 eligible 	 f or 	 member ship 	 o f 	 the 	 main 	 r e tir emen t 	 bene fit s 	 s cheme s 	 oper at ed 	 b y 	 s tv 	 gr oup 	 plc 	 f or 	 the 	
de fined 	 bene fit 	 s cheme  	 as s e t s 	 ar e 	 me asur ed 	 at 	 f air 	 v alue  		 p ension 	 s cheme 	 liabilitie s 	 ar e 	 me asur ed 	 on 	 an 	 act uarial 	 b asis 	 using 	 a 	
pr oject ed 	 unit 	 me thod 	 and 	 dis c oun t ed 	 at 	 the 	 c urr en t 	 r at e 	 o f 	 r e t urn 	 on 	 a 	 high 	 qualit y 	 c orpor at e 	 bond 	 o f 	 equiv alen t 	 t erm 	 and 	 c urr enc y	
t o 	 the 	 s cheme ’ s 	 liabilitie s  		 t he 	 incr e as e 	 in 	 the 	 pr e s en t 	 v alue 	 o f 	 the 	 liabilitie s 	 o f 	 the 	 de fined 	 bene fit 	 pension 	 s cheme 	 e xpect ed 	 t o 	 aris e 	
fr om 	 emplo y ee 	 s ervic e 	 in 	 the 	 period 	 is 	 char ged 	 t o 	 oper ating 	 pr o fit  	 t he 	 e xpect ed 	 r e t urn 	 on 	 the 	 s cheme ’ s 	 as s e t s 	 and 	 the 	 incr e as e 	
during 	 the 	 period 	 in 	 the 	 pr e s en t 	 v alue 	 o f 	 the 	 s cheme ’ s 	 liabilitie s 	 arising 	 fr om 	 the 	 p as s age 	 o f 	 time 	 ar e 	 included 	 in 	 ne t 	 in t er e s t 	 p a y able	
and 	 similar 	 char ge s  	 a ct uarial 	 gains 	 and 	 lo s s e s 	 ar e 	 r ec ognis ed 	 in 	 the 	 s t at emen t 	 o f 	 r ec ognis ed 	 gains 	 and 	 lo s s e s  	 	 	 	
f or 	 de fined 	 c on tribution 	 s cheme s 	 the 	 amoun t 	 char ged 	 t o 	 the 	 pr o fit 	 and 	 lo s s 	 ac c oun t 	 is 	 the 	 c on tributions 	 p a y able 	 in 	 the 	 y e ar 	
2	 in v e s tmen t s
£m
cost
a t 	 1 	 january 	 2 010 4 8 16
a dditions 273
dispo s als 4 8 16
at 31 december 2010 273
provisions for impairment
a t 	 1 	 january 	 2 010 23 0 8
imp airmen t 	 during 	 y e ar 1 35 3
dispo s als 3 66 1
at 31 december 2010 –
net book value at 31 december 2010 273
ne t 	 book 	 v alue 	 at 	 3 1 	 dec ember 	 2 009 25 0 8
as 	 p ar t 	 o f 	 a 	 gr oup 	 r e s truct ur e 	 and 	 r ationalis ation 	 o f 	 in t er c omp an y 	 deb t 	 e x er cis e 	 c arried 	 out 	 during 	 the 	 y e ar  	 the 	 c arrying 	 v alue s	 	
o f 	 the 	 c omp an y’ s 	 in v e s tmen t s 	 w er e 	 r e vie w ed 	 t o 	 de t ermine 	 whe ther 	 the y 	 c on tinued 	 t o 	 be 	 appr opriat e  	 t his 	 in v olv ed 	 a 	 r e vie w 	 o f 	 the	
underlying 	 busine s s 	 and 	 en tit y 	 v aluations 	 and 	 r e sult ed 	 in 	 imp airmen t 	 char ge s 	 t o t alling 	 £13 5 3m 	 t he 	 r e vie w 	 c arried 	 out 	 in 	 2 009	
r e sult ed 	 in 	 imp airmen t 	 writ edo wns 	 o f 	 £5 1 0m 	 and 	 w er e 	 made 	 primarily 	 in 	 r elation 	 t o 	 p e arl 	  	 de an	 	 	 	
in 	 addition 	 as 	 p ar t 	 o f 	 the 	 gr oup 	 r e s truct ur e 	 during 	 the 	 y e ar  	 the 	 c omp an y 	 ac quir ed 	 in v e s tmen t s 	 in 	 s tv 	 ne w s 	 s ervic e 	 limit ed 	 and	
ris e 	  	 shine 	 limit ed 	 fr om 	 f ello w 	 gr oup 	 under t akings 	 f or 	 a 	 nominal 	 amoun t  	 	 	 	 	 	 	 	
als o 	 as 	 p ar t 	 o f 	 the 	 gr oup 	 r e s truct ur e  	 the 	 c omp an y 	 dispo s ed 	 o f 	 in v e s tmen t s 	 in 	 smg 	  jer s e y  	 limit ed 	 s tv 	 publishing 	 limit ed	 	
and 	 s tv 	 out 	 o f 	 home 	 limit ed 	 t o 	 a 	 f ello w 	 gr oup 	 under t aking 	 f or 	 nil 	 c onsider ation 	 t he 	 c omp an y 	 dispo s ed 	 o f 	 it s 	 in v e s tmen t 	 in	 	
s tv 	 t ele vision 	 limit ed 	 t o 	 a 	 f ello w 	 gr oup 	 under t aking 	 f or 	 a 	 c onsider ation 	 o f 	 £13 3  0m 	 c onsis ting 	 o f 	 £3 3  0m 	 shar e s 	 and 	 £100  0m	
in t er c omp an y 	 in t er e s t –be aring 	 lo an 	 r e sulting 	 in 	 an 	 unr e alis ed 	 gain 	 on 	 dispo s al 	 o f 	 £17  1m	 	 	 	 	
	 annual report and accounts 2010
a cco u n t s
2	 in v e s tmen t s 	continued
 
 subsidiary undertakings
t h e 	 d i r e c t o r s 	 c o n s i d e r 	 t h a t 	 t o 	 g i v e 	 f u l l 	 p a r t i c u l a r s 	 o f 	 a l l 	 s u b s i d i a r y 	 u n d e r t a k i n g s 	 w o u l d 	 l e a d 	 t o 	 a 	 s t a t e m e n t 	 o f 	 e x c e s s i v e 	 l e n g t h 	 	
t h e 	 f o l l o w i n g 	 i n f o r m a t i o n 	 r e l a t e s 	 t o 	 t h e 	 s u b s i d i a r y 	 u n d e r t a k i n g s 	 w h o s e 	 r e s u l t s 	 o r 	 fi n a n c i a l 	 p o s i t i o n  	 i n 	 t h e 	 o p i n i o n 	 o f 	 t h e 	 d i r e c t o r s 	
princip ally 	 af f ect 	 the 	 r e sult s 	 o f 	 the 	 gr oup
under t aking
c oun try 	 o f 	 inc orpor ation 	 or
r egis tr ation 	 and 	 oper ation princip al 	 activit y
s tv 	 c en tr al 	 limit ed s c o tland t ele vision 	 br o adc as ting
s tv 	 nor th 	 limit ed s c o tland t ele vision 	 br o adc as ting
s t v 	 p r o d u c t i o n s 	 l i m i t e d	 s c o tland pr ogr amme 	 pr oduction
s olutions  t v 	 l t d s c o tland t ele vision 	 t echnic al 	 f acilitie s
ginger 	 t ele vision 	 pr oductions 	 limit ed england pr ogr amme 	 pr oduction
	
none 	 o f 	 the 	 abo v e 	 in v e s tmen t s 	 ar e 	 held 	 dir ectly 	 b y 	 s tv 	 gr oup 	 plc 	 t he 	 in v e s tmen t s 	 ar e 	 s t at ed 	 in 	 the 	 b alanc e 	 shee t 	 at 	 c o s t 	 le s s	
amoun t s 	 writ t en 	 o f f 	 f or 	 imp airmen t 	 in 	 v alue  	 all 	 shar e s 	 ar e 	 or dinary 	 shar e s  	 all 	 o f 	 the 	 abo v e 	 in v e s tmen t s 	 ar e 	 100 	 shar eholdings	
within 	 the 	 gr oup 
 dividends
t he 	 c omp an y 	 r ec eiv ed 	 dividends 	 o f 	 £2 5  0m 	 in 	 the 	 y e ar 	 2 009 	 £ 4 8 0m 
3 	 deb t or s
2 010
£m
2 009
£m
due within one year
amoun t s 	 o w ed 	 b y 	 gr oup 	 under t akings 	 7 7 2	 	 8 0  0	
pr ep a ymen t s 	 and 	 ac crued 	 inc ome 	 0  8	 	 0  3	
	 7 8  0	 	 8 0  3	
due after one year
amoun t s 	 o w ed 	 b y 	 gr oup 	 under t akings 	 106 7	 –
pr ep a ymen t s 	 and 	 ac crued 	 inc ome 	 4  5	 	 4 2	
	 1112	 	 4 2	
included 	 within 	 amoun t s 	 o w ed 	 b y 	 gr oup 	 under t akings 	 due 	 aft er 	 one 	 y e ar 	 is 	 a 	 lo an 	 o f 	 £100  0m 	 t o 	 a 	 sub sidiary 	 under t aking 	 in t er e s t	
on 	 the 	 lo an 	 ac crue s 	 at 	 a 	 r at e 	 o f 	 9 	 and 	 is 	 p a y able 	 fr om 	 1 	 april 	 2 010  	 in t er e s t 	 ac crued 	 is 	 c apit alis ed 	 and 	 added 	 t o 	 the 	 princip al	
amoun t  	 in t er e s t 	 will 	 als o 	 ac crue 	 on 	 in t er e s t 	 which 	 is 	 c apit alis ed 	 in 	 this 	 w a y  	 t he 	 lo an 	 is 	 r ep a y able 	 on 	 3 1 	 mar ch 	 2 0 2 0 
all 	 r emaining 	 amoun t s 	 o w ed 	 b y 	 gr oup 	 under t akings 	 ar e 	 uns ec ur ed 	 in t er e s t 	 fr ee 	 and 	 ha v e 	 no 	 fix ed 	 dat e 	 o f 	 r ep a ymen t 
no t e s 	 t o 	 the 	 c omp an y 	 financial 	 s t at emen t s
continued 97
4 	 cr edit or s 	 amoun t s 	 f alling 	 due 	 within 	 one 	 y e ar
2 010
£m
2 009
£m
t r ade 	 cr edit or s 	 and 	 ac cruals 	 0  9	 	 1 9	
c orpor ation 	 t ax – 	 0  8	
amoun t s 	 due 	 t o 	 sub sidiary 	 under t akings 	 3 0  9	 	 6  4	
	 3 1  8	 	9 1	
amoun t s 	 due 	 t o 	 gr oup 	 under t akings 	 ar e 	 uns ec ur ed 	 in t er e s t 	 fr ee 	 and 	 ha v e 	 no 	 fix ed 	 dat e 	 o f 	 r ep a ymen t 
5 	 b ank 	 lo ans
2 010
£m
2 009
£m
b ank 	 lo ans 	 5 9  9	 	 6 7 5	
t he 	 borr o wings 	 ar e 	 r ep a y able 	 as 	 f ollo w s
expiring 	 within 	 1 	 y e ar 	 5  0	 	 6 7 5	
expiring 	 in 	 2 	 t o 	 5 	 y e ar s 	 5 4  9	 –	
	 5 9  9	 	 6 7 5
	
all 	 undr a wn 	 c ommit t ed 	 borr o wing 	 f acilitie s 	 ar e 	 r ep a y able 	 within 	 t w o 	 t o 	 fiv e 	 y e ar s 	 2 009 	 t w o 	 t o 	 fiv e 	 y e ar s 	
t he 	 dir ect or s 	 c onsider 	 that 	 the 	 v alue 	 o f 	 c urr en t 	 borr o wings 	 appr o ximat e 	 their 	 f air 	 v alue 
t he 	 e f f ectiv e 	 in t er e s t 	 r at e s 	 w er e 	 as 	 f ollo w s
2 010

2 009

b ank 	 lo ans 	  flo ating 	 4  0	 	 5  0	
as 	 at 	 3 1 	 dec ember 	 2 010  	 the 	 c omp an y 	 had 	 b ank 	 f acilitie s 	 in 	 plac e 	 t o t alling 	 £7 0  0m 	 c onsis ting 	 o f 	 a 	 £5 5  0m 	 t erm 	 f acilit y  	 £10  0m	
r e v olving 	 cr edit 	 f acilit y 	 and 	 £5  0m 	 o v er dr aft  	 t he 	 f acilitie s 	 e xpir e 	 on 	 3 1 	 dec ember 	 2 012 	 with 	 the 	 r e v olving 	 cr edit 	 f acilit y 	 amor tising	 	
b y 	 £5  0m 	 on 	 3 1 	 dec ember 	 2 011 	 s ec urit y 	 is 	 pr o vided 	 t o 	 the 	 deb t 	 pr o vider 	 b y 	 w a y 	 o f 	 cr o s s –guar an t ee s 	 and 	 a 	 shar e 	 pledge 	 	
6	 cr edit or s 	 amoun t s 	 f alling 	 due 	 aft er 	 mor e 	 than 	 one 	 y e ar
2 010
£m
2 009
£m
amoun t s 	 due 	 t o 	 sub sidiary 	 under t akings – 	 1 3 6  0	
amoun t s 	 due 	 t o 	 gr oup 	 under t akings 	 ar e 	 uns ec ur ed 	 in t er e s t 	 fr ee 	 and 	 ha v e 	 no 	 fix ed 	 dat e 	 o f 	 r ep a ymen t  annual report and accounts 2010
a cco u n t s
7 	 r e s er v e s 	 and 	 mo v emen t s 	 in 	 shar eholder s ’ 	 funds
	
s h a r e	
c apit al
£m
s h a r e	
pr emium
£m
p rofi t
	 a n d 	 l o s s	
r ese rv es	
£m
other	 	
r ese rv e
£m
total
£m
a t 	 1 	 january 	 2 010 	 1 8  3	 	 1 1 1  3	 	 6 7 	 0 5	 	 1 2 3  4	
own 	 shar e s 	 ac quir ed 	 and 	 is sued 	0 9	 	0 1	 	 1 0 –	 –
r e t ained 	 pr o fit s 	 f or 	 the 	 y e ar –	 –	 	 1  0	 –	 	 1  0	
e quit y 	 s e t tled 	 shar e 	 b as ed 	 p a ymen t s –	 –	 – 	 0  3	 	 0  3	
own 	 shar e s 	 a w ar ded –	 –	 	 0  3	 –	 	 0  3	
p ension 	 s cheme 	 de ficit –	 –	 	 10  7 –	 	 10  7
a t 	 3 1 	 dec ember 	 2 010 	 19 2	 	 111 4	 	 17  1 	 0  8	 	 114 3
	
included 	 within 	 pr o fit 	 and 	 lo s s 	 r e s erv e s 	 is 	 an 	 unr e alis ed 	 amoun t 	 o f 	 £17  1m	 	 	 	 	 	 	
t he 	 c omp an y 	 included 	 the 	 c aledonian 	 pension 	 s cheme 	 de ficit 	 f or 	 the 	 fir s t 	 time 	 in 	 2 010 	 f ollo wing 	 an 	 agr eemen t 	 in 	 principle 	 f or 	 it 	 t o 	
be 	 guar an t or 	 f or 	 the 	 s cheme  	 t he 	 s cheme 	 has 	 been 	 within 	 the 	 gr oup 	 in 	 prior 	 y e ar s 	 and 	 ther e f or e 	 the 	 his t oric 	 in f ormation 	 is 	 included	
belo w 	  no t e 	 9	 	 	 	 	 	 	 	 	
										
8	 t r ans actions 	 with 	 r elat ed 	 p artie s	 	 	 	 	 	 	 	 	 	
t her e 	 w er e 	 no 	 tr ans actions 	 with 	 an y 	 r elat ed 	 p ar tie s 	 during 	 the 	 y e ar 	 o ther 	 than 	 tho s e 	 e x emp t 	 fr om 	 dis clo sur e 	 under 	 frs 	 8
9 	 r e tir emen t 	 bene fit 	 s cheme s
t he 	 c omp an y 	 oper at e s 	 a 	 de fined 	 bene fit 	 pension 	 s cheme  	 t he 	 s cheme 	 is 	 trus t ee 	 adminis t er ed 	 and 	 the 	 s cheme ’ s 	 as s e t s 	 ar e 	 held 	
independen tly 	 o f 	 the 	 c omp an y’ s 	 financ e s  	 p ension 	 c o s t s 	 ar e 	 as s e s s ed 	 in 	 ac c or danc e 	 with 	 the 	 advic e 	 o f 	 an 	 independen t 	 pr o f e s sionally 	
qualified 	 act uary  	 	 	 	 	 	 	 	 	 	
t he 	 s cheme 	 is 	 the 	 c aledonian 	 publishing 	 p ension 	 s cheme 	 and 	 is 	 a 	 clo s ed 	 s cheme 	 ther e f or e 	 under 	 the 	 pr oject ed 	 unit 	 me thod 	 the	
c urr en t 	 s ervic e 	 c o s t 	 will 	 incr e as e 	 as 	 the 	 member s 	 o f 	 the 	 s cheme 	 appr o ach 	 r e tir emen t 	 	 	 	 	 	
a 	 full 	 act uarial 	 v aluation 	 o f 	 the 	 s cheme 	 w as 	 c arried 	 out 	 at 	 1 	 january 	 2 009 	 and 	 updat ed 	 t o 	 3 1 	 dec ember 	 2 010 	 b y 	 a 	 qualified 	
independen t 	 act uary  		 t he 	 major 	 as sump tions 	 us ed 	 b y 	 the 	 act uary 	 w er e	 	 	 	 	 	 	
a t 	 3 1	
dec ember
2 010
a t 	 3 1	
dec ember
2 009
dis c oun t 	 r at e 5 55 5 7 0
in flation 	 33 0  3  40
										
		
no t e s 	 t o 	 the 	 c omp an y 	 financial 	 s t at emen t s
continued 99
 mortality rate         
as sump tions 	 r egar ding 	 fut ur e 	 mor t alit y 	 e xperienc e 	 ar e 	 s e t 	 b as ed 	 on 	 advic e  	 published 	 s t atis tic s 	 and 	 e xperienc e 	 in 	 e ach 	 t errit ory 	
t he 	 a v er age 	 lif e 	 e xpect anc y 	 in 	 y e ar s 	 o f 	 a 	 pensioner 	 r e tiring 	 at 	 age 	 6 5 	 is 	 as 	 f ollo w s	 	 	 	 	
a t 	 3 1	
dec ember
2 010
years
a t 	 3 1	
dec ember
2 009
years
r e tiring 	 at 	 b alanc e 	 shee t 	 dat e
male 14 6 14 6
f emale 17 5 17 5
r e tiring 	 in 	 2 0 	 y e ar s
male 1 5 4 1 5 4
f emale 183 183
							
t he 	 f air 	 v alue 	 o f 	 the 	 as s e t s 	 in 	 the 	 s cheme  	 the 	 pr e s en t 	 v alue 	 o f 	 the 	 liabilitie s 	 in 	 the 	 s cheme 	 and 	 the 	 e xpect ed 	 r at e 	 o f 	 r e t urn 	 at 	 e ach	
b alanc e 	 shee t 	 dat e 	 w as	 	 	 	 	 	 	 	 	
at
3 1 	 dec ember
2 010
£m
at
3 1 	 dec ember
2 009
£m
at
3 1 	 dec ember
2 008
£m
at
3 1 	 dec ember
20 0 7
£m
at
3 1 	 dec ember
2 006
£m
e quitie s 	 5 5  5	 	 5 2  3	 	 4 86	 	 6 5 5	 	6 5 1	
b onds 	 5 3  3	 	 50 2	 	 4 6  8	 	 53 5	 	 5 12	
f air 	 v alue 	 o f 	 s cheme ’ s 	 as s e t s 	 1088	 	 10 25	 	 9 5  4	 	 1 1 9  0	 	 1 1 6  3	
pr e s en t 	 v alue 	 o f 	 de fined 	 bene fit 	 obligations 	 12 3  4 	 12 2 7 	 10 7  0 	 117 8 	 13 1 0
de ficit  surplus 	 in 	 the 	 s cheme 	 14 6 	 2 0 2 	 116 	 12	 	 14  7
e quitie s 8 0 8 0 8 0 8 0 8  4
b onds 4 2– 	 5 6  4 5 – 	 5  7  3  7 – 	 66  4  4 – 	 6 1 4 6 – 	 5 2
									
a 	 r elat ed 	 o f f s e t ting 	 de f err ed 	 t ax 	 as s e t 	 o f 	 £3  9m 	 is 	 included 	 under 	 fix ed 	 as s e t s  	 t her e f or e 	 the 	 ne t 	 pension 	 s cheme 	 de ficit 	 amoun t s 	 	
t o 	 £10  7m 	 at 	 3 1 	 dec ember 	 2 010 	
	 	 	 	
 history of experience gains and losses         
at
3 1 	 dec ember
2 010
at
3 1 	 dec ember
2 009
at
3 1 	 dec ember
2 008
at
3 1 	 dec ember
20 0 7
at
3 1 	 dec ember
2 006
difference between the expected and actual return  
on scheme assets
amoun t 	 £m  	 5 6 	 7  9 	 2 5  7	 	 2 1	 	 1 1	
p er c en t age 	 o f 	 s cheme 	 as s e t s 5  8   27  2 1
experience gains and losses on scheme liabilities
amoun t 	 £m  	0 7	 	 2 9	 	 0  9 	 13 8 	 22	
p er c en t age 	 o f 	 the 	 pr e s en t 	 v alue 	 o f 	 s cheme 	 liabilitie s 1 2 1 12 2
t otal amount recognised in statement of recognised  
gains and losses
amoun t 	 £m  	 4  8	 	 9 3 	 15 2 	 116	 	 12	
p er c en t age 	 o f 	 the 	 pr e s en t 	 v alue 	 o f 	 s cheme 	 liabilitie s 4 8  14  10 1 annual report and accounts 2010
a cco u n t s
ifrs
2 006
£m
20 0 7
£m
2 008
£m
2 009
£m
2 010
£m
r e sult s
r e v enue
c on tinuing 	 oper ations 	 12 5 6	 	 1 2 0  3	 	 1112	 	 9 0  3	 	 1 0 4  8	
dis c on tinued 	 oper ations 	 6 5 6	 	 6 5  0	 	 3 3  3	 	 19  9	 	 6  9	
	 1912	 	 1 8 5  3	 	 144 5	 	 110 2	 	 111 7	
pr o fit 	 fr om 	 oper ations 	 be f or e 	 e x c ep tional 	 it ems
c on tinuing 	 oper ations 	 1 5  8	 	 11 1	 	 13 2	 	 9 2	 	 14  4	
dis c on tinued 	 oper ations 	 26	 	 9  0	 	 15	  –
	 1 8  4	 	2 0 1	 	 1 4  7	 	 9 2	 	 14  4	
pr o fit 	 on 	 or dinary 	 activitie s 	 be f or e 	 t ax ation 	 and 	 e x c ep tional 	 it ems 	 1 0  0	 	 8 1	 	 1 2  8	 	 5 5	 	 1 2  5	
a ss e t s	
nonc urr en t 	 as s e t s 	 1465	 	 2 85	 	 3 4  7	 	 3 2 1	 	2 9 1	
c urr en t 	 as s e t s 	 90 2	 	 882	 	7 9 9	 	 84 2	 	 6 9  9	
as s e t s 	 clas sified 	 as 	 held 	 f or 	 s ale 	 7 6  7	 	 7 9 6	 	 1 8  8	 	 12 1	 –
t o t al 	 as s e t s 	 3 1 3  4	 	 1 9 6  3	 	 1 3 3  4	 	 1 2 8  4	 	 9 9  0	
e quit y 	 and 	 liabilitie s
c urr en t 	 liabilitie s 	 6 1  0	 	 34 6	 	 3 25	 	 1 0 0  8	 	 35  4	
nonc urr en t 	 liabilitie s 	 19 7  1	 	 7 85	 	 9 6 1	 	 3 8  3	 	 8 3 4	
liabilitie s 	 dir ectly 	 as s ociat ed 	 with 	 as s e t s 	 held 	 f or 	 s ale 	 9  8	 	 19 5	 	 21 9	 	 212	 –
e quit y 	 4 5 5	 	 63 5	 	 17  1 	 3 1 9 	 19 8
minorit y 	 in t er e s t s  	 0 2	   –
t o t al 	 equit y 	 and 	 liabilitie s 	 3 1 3  4	 	 1 9 6  3	 	 1 3 3  4	 	 1 2 8  4	 	 9 9  0	
k e y 	 s t atis tic s
e arnings 	 per 	 or dinary 	 shar e 	  	 b asic 	 and 	 dilut ed 6 00 p 4 2 0p 2 5 7p 13  7p 3 2 9p
dividends 	 per 	 or dinary 	 shar e 24 0p    –
 		 t he 	 2 006 	 and 	 2 00 7 	 e arnings 	 per 	 or dinary 	 shar e 	 and 	 dividends 	 per 	 or dinary 	 shar e 	 ha v e 	 been 	 r e s t at ed 	 f or 	 the 	 1 	 f or 	 2 0 	 shar e	
c ons olidation 	 which 	 t ook 	 plac e 	 in 	 2 008	 	
fiv e 	 y e ar 	 s ummar y
f or the year ended 31 december 2010 101
report and accounts 2010
shareholders
shareholder information
registrars
capita registrars 
the registry 34 beckenham road 
beckenham kent br3 4tu
t el 0871 664 0300 
t el overseas 44 20 8639 3399 
f ax 44 0 1484 600 911 
email ssdcapitaregistrarscom 
website wwwcapitashareportalcom
independent auditors
pricewaterhousecoopers llp
chartered accountants and statutory auditors
141 bothwell street 
glasgow g2 7eq
solicitors
herbert smith llp 
exchange house 
primrose street 
london ec2a 2hs
burness llp 
120 bothwell street 
glasgow g2 7jl 
principal bankers
bank of scotland plc
stockbrokers
peel hunt 
111 old broad street 
london ec2n 1ph
secretary and registered office
jane e a t ames 
stv group plc 
pacific quay 
glasgow g51 1pq 
t el 0141 300 307 4 
email janetamesstvtv
company registration number 
sc203873
annual report on internet
the 2010 annual report of stv group plc including the 
financial statements is available at wwwstvplctv report and accounts 2010
shareholders
shareholder information 
continued
amalgamation of accounts
shareholders who receive duplicate sets of company mailings because they have multiple accounts should write to the registrars to have 
the accounts amalgamated
investor relations
for investor enquiries please contact 
the company secretary 
stv group plc 
pacific quay 
glasgow g51 1pq 
t el 0141 300 3000 
share price information
the share price of stv group plc is published in most newspapers and also in the united kingdom on ceefax and t eletext the current 
price of the company’s shares delayed by up to 15 minutes can be obtained from the company’s website wwwstvplctv
individual savings accounts isas
the company has maxi and mini isas which offer united kingdom resident shareholders a simple low–cost and tax–efficient way to invest 
in the company’s shares full details and an application form are available from stocktrade a division of brewin dolphin securities 
limited on 0131 240 0441
dividend reinvestment plan
stv group plc operates a dividend reinvestment plan to provide united kingdom shareholders with a facility to invest cash dividends by 
purchasing further stv group plc shares further details are available from the registrar on 0871 664 0381
y our shareholding
y ou can check your shareholding at any time by visiting the registrar’s website at
wwwcapitashareportalcom
capita share dealing services
capita offer a quick and easy share dealing service to buy or sell stv group plc shares an online telephone dealing facility is available 
providing stv group plc shareholders with an easy to access and simple to use service there is no need to pre–register and there are no 
complicated forms to fill in the online and telephone dealing services allow you to trade “real time” at a known price which will be given 
to you at the time you give your instruction for further information on this service or to buy and sell shares please contact www
capitadealcom online dealing 0871 664 0454 telephone dealing
 calls cost 10p per minute plus network extras lines are open 830am – 530pm monday to friday
 calls cost 10p per minute plus network extras lines are open 8am – 430pm monday to friday  103
notice is hereby given that the annual general meeting of the company will be held at pacific quay glasgow g51 1pq on  
wednesday 20 april 2011 at 11am for the purpose of considering the resolutions below
resolutions 1 to 8 inclusive will be proposed as ordinary resolutions and resolutions 9 to 11 inclusive shall be proposed as  
special resolutions 
ordinary resolutions
1  t o consider and adopt the annual accounts of the company for the financial year ended 31 december 2010 which includes the report 
by the directors the remuneration report by the directors and the report by the auditors on the annual accounts and the auditable 
part of the remuneration report
2 t o approve the report by the directors on remuneration for the financial year ended 31 december 2010
  the remuneration report by the directors which may be found on pages 44 to 54 gives details of the directors’ remuneration  
for the year ended 31 december 2010 and sets out the company’s overall policy on directors’ remuneration during the year  
  as required by the directors’ remuneration report regulations 2002 the company’s auditors pricewaterhousecoopers llp   
have audited those parts of the report capable of being audited
3 t o re–elect richard findlay as a director of the company 
  the articles of association require that every year a proportion of our directors retire and that all directors have to stand for 
re–election on the third anniversary of their election or re–election this gives you the chance to confirm their appointments        
  biographical details of richard findlay can be found on page 34 and the board confirms that he meets the independence criteria  
as set out in a31 of the revised combined code following formal performance evaluation mr findlay’s performance is considered  
to be effective and demonstrates commitment to the role
4 t o re–elect rob woodward as a director of the company 
  the articles of association require that every year a proportion of our directors retire and that all directors have to stand for 
re–election on the third anniversary of their election or re–election this gives you the chance to confirm their appointments        
  biographical details of rob woodward can be found on page 34 following formal performance evaluation mr woodward’s 
performance continues to be effective and to demonstrate commitment to the role
5 t o re–elect jamie matheson as a director of the company
  the articles of association require that every year a proportion of our directors retire and that all directors have to stand for 
re–election on the third anniversary of their election or re–election this gives you the chance to confirm their appointments        
  biographical details of jamie matheson can be found on page 34 and the board confirms that he meets the independence criteria  
as set out in a31 of the revised combined code following formal performance evaluation mr matheson’s performance continues  
to be effective and to demonstrate commitment to the role
6  t o re–appoint pricewaterhousecoopers llp as the auditors of the company to hold office until the conclusion of the next  
general meeting at which accounts are laid and to authorise the audit committee to fix the remuneration of the auditors
notice of annual general meeting annual report and accounts 2010
shareholders
7  t o grant the directors authority to allot shares
 we will be asking you to vote on the following ordinary resolution
  “that for the purpose of section 551 of the companies act 2006 the “ act” the directors be and are hereby generally and 
unconditionally authorised to exercise all the powers of the company to allot equity securities within the meaning of section 560 of 
the act up to an aggregate nominal amount of £6389406 provided that this authority shall expire at the conclusion of the next 
annual general meeting of the company after the passing of the resolution save that the company may before such expiry make an 
offer or agreement which would or might require equity securities to be allotted after such expiry and the directors may allot equity 
securities pursuant to any such offer or agreement as if the authority conferred by this resolution had not expired and further
 
  that the directors be and are hereby generally and unconditionally authorised to exercise all the powers of the company to allot 
equity securities within the meaning of section 560 of the act in connection with a rights issue in favour of ordinary shareholders of 
the company where the equity securities respectively attributable to the interests of all ordinary shareholders are proportionate as 
nearly as may be to the respective number of ordinary shares held by them in the company or in favour of the holders of other 
equity securities as required by the rights of those securities up to an aggregate nominal amount of £6389406 provided that this 
authority shall expire on the date of the next annual general meeting of the company after the passing of the resolution but so that 
the directors may at any time prior to such expiry make an offer or agreement which would or might require equity securities to be 
allotted after such expiry and the directors may allot equity securities pursuant to any such offer or agreement as if the authority 
conferred by this resolution had not expired”
  the directors require the authority of shareholders to allot the company’s shares and the first part of this resolution extends for a 
further year the general authority for the directors to allot a limited number of ordinary shares 12778812 shares representing one 
third of the ordinary issued share capital at 23 february 2011 excluding treasury shares none of which are held by the company to 
provide the flexibility to take advantage of business opportunities as they arise the second part of this resolution allows the directors 
to allot a limited number of ordinary shares 12778812 shares representing one third of the ordinary issued share capital at 23 
february 2011 excluding treasury shares none of which are held by the company pursuant to a fully pre–emptive rights issue of the 
company  the authority will terminate at the next annual general meeting of the company which must be held no later than 30 june 
2012 the directors do not have any present intention of exercising this authority except to satisfy awards of shares under the 
company’s employee share schemes and no issue of ordinary shares will be made which would effectively alter control of the 
company without the prior approval of the company in general meeting the directors confirm that if this further authority were 
utilised during the year  they intend to follow the guidance of the association of british insurers and would all stand for re–election at 
the next agm
8 t o amend the rules of the stv group plc sharesave scheme
 we will be asking you to vote on the following ordinary resolution
  “that the amendment to the rules of the stv group plc sharesave scheme formerly the smg plc sharesave scheme the 
“scheme” contained in the amended rules of the scheme produced in draft to this meeting and for the purposes of identification 
initialled by the chairman be approved and the directors be authorised to adopt the amended scheme and to do all such acts and 
things as they consider necessary or expedient for the purposes of implementing it including making any amendments required by 
hm revenue  customs in order to obtain approval of the scheme under schedule 3 of the income t ax earnings and pensions  
act 2003”
  the company’s sharesave scheme which was adopted by the shareholders on 26 may 2000 and amended by the company on  
6 april 2001 currently does not permit the grant of options after 18 may 2007  the remuneration committee is proposing to amend 
the scheme to allow options to continue to be granted until the 20th anniversary of the original date of adoption by the company  
on 26 may 2000 all other aspects of the scheme will remain unchanged
 
notice of annual general meeting 
continued 105
special resolutions
9 t o dis–apply statutory pre–emption rights
 we will be asking you to vote on the following special resolution
  “that subject to the passing of resolution 7  the directors be and are hereby empowered pursuant to section 570 of the act to allot 
equity securities within the meaning of section 560 of the act for cash pursuant to the authority conferred by resolution 7 as if 
section 561 of the act did not apply to any such allotment provided that this power shall be limited to 
 a  the allotment of equity securities in connection with a rights issue open offer or other offer of securities in favour of the holders 
of the ordinary shares of 50p each in the capital of the company where the equity securities respectively attributable to the 
interest of all such holders are proportionate as nearly as may be to the respective number of ordinary shares held by them 
subject to such exclusions or other arrangements as the directors may deem necessary or expedient in relation to fractional 
entitlements or legal or practical problems arising under the laws or requirements of any recognised regulatory body or any 
stock exchange or otherwise in any territory and
 b  the allotment of equity securities otherwise than pursuant to sub–paragraph a above having in the case of ordinary shares  
as defined in section 560 of the act a nominal value or  in the case of other securities giving the right to subscribe or convert 
into ordinary shares having a nominal value not exceeding in the aggregate £958410
  the authority shall expire on the conclusion of the next annual general meeting of the company after the passing of this resolution 
save that the company may before such expiry make an offer or agreement which would or might require equity securities to be 
allotted after such expiry and the directors may allot equity securities pursuant to any such offer or agreement as if the authority 
conferred by this resolution had not expired”
  when ordinary shares are issued for cash they normally have to be offered in the first instance to existing holders of ordinary shares 
in proportion to their respective shareholdings this resolution extends for a further year the authority granted to the directors to 
allot a limited number of ordinary shares 1916821 shares representing 5 of the ordinary issued share capital at 23 february 2011 
other than to existing shareholders in proportion to their existing shareholdings this again is to provide directors with the flexibility 
to take advantage of business opportunities as they arise the authority will terminate at the next annual general meeting which 
must be held no later than 30 june 2012 no issue of ordinary shares will be made which would effectively alter control of the 
company without the prior approval of the company in general meeting the board also confirms that no more than 7 5 of the 
issued share capital would be issued on a non pre–emptive basis in any three–year period 
10 t o purchase the company’s own shares
 we will be asking you to vote on the following special resolution
  “that the company be and is hereby generally and unconditionally authorised pursuant to section 701 of the act to make market 
purchases as defined in section 6934 of the act of ordinary shares of 50p each in the capital of the company “shares” and the 
directors be and are hereby generally and unconditionally authorised to exercise all the powers of the company to purchase the 
shares provided that
 a the nominal value of maximum number of shares acquired pursuant to this authority shall not exceed £1916821
 b the minimum price which may be paid by the company for a share purchased pursuant to this authority shall be 50p
 c  the maximum price which may be paid by the company for a share purchased pursuant to this authority shall not be more than 
the higher of i 5 above the average of the middle market quotations for a share derived from the london stock exchange 
daily official list for the five business days immediately preceding the day on which such share is purchased and ii the price 
stipulated by article 51 of the buy–back and stabilisation regulation ec22732003 and  annual report and accounts 2010
shareholders
 d  unless renewed the authority conferred by this resolution shall expire on the earlier of the conclusion of the next annual general 
meeting of the company after passing of this resolution and the expiry of 12 months from the date of passing this resolution save 
that the company may before such expiry make a contract to purchase which will or may be executed wholly or partly after the 
expiry of such authority and the company may make a purchase of such shares after such expiry pursuant to such contract” 
  this resolution seeks the authority of shareholders to allow the company to purchase its own shares the authority sought extends to 
3833643 shares representing 10 of the ordinary issued share capital in issue at 23 february 2011 the maximum price which may 
be paid amounts to not more than 5 above the average of the middle market quotations of the company’s shares for the five 
business days immediately preceding the date of purchase the power will only be used if the board is satisfied that it will be in the 
best interests of shareholders generally 
  in exercising the authority to purchase the company’s shares the directors intend to cancel any shares purchased but may however  
treat the shares that have been bought back as held in treasury and to the extent that any such shares are held in treasury earnings 
per share will only be increased on a temporary basis until such time as the shares are resold out of treasury stock
  as at 23 february 2011 warrants and options to subscribe for 1455614 of the company’s shares were outstanding representing 
380 of the ordinary shares in issue at 23 february 2011 excluding treasury shares held by the company and 422 of the  
ordinary shares in the company excluding treasury shares held by the company following the exercise in full of this authority  
to purchase shares
11 t o allow general meetings to be held on 14 days notice
 we will be asking you to vote on the following special resolution
  “that the company be entitled to hold general meetings of the shareholders of the company with the exception of annual general 
meetings on the provision of 14 clear days notice to the company’s shareholders”
  the companies act following the implementation of the eu shareholder rights directive permits the holding of general meetings  
on 14 days notice provided a special resolution is passed at the company’s annual general meeting approving this notice period 
by order of the board
jane e a t ames
company secretary 
stv group plc 
pacific quay 
glasgow g51 1pq 
23 february 2011
notes
1  information regarding the meeting including the information required by section 311a of the companies act 2006 is available from 
the investor centre at wwwstvplctv 
2  members are entitled to appoint a proxy to exercise all or any of their rights to attend and to speak and vote on their behalf at the 
meeting a shareholder may appoint more than one proxy in relation to the annual general meeting provided that each proxy is 
appointed to exercise the rights attached to a different share or shares held by that shareholder  a proxy need not be a shareholder of 
the company a proxy form which may be used to make such appointment and give proxy instructions accompanies this notice if you 
do not have a proxy form and believe that you should have one or if you require additional forms please contact capita registrars on 
0871 664 0300 or ssdcapitaregistrarscom calls cost 10p per minute plus network extras lines are open 830am to 530pm monday 
notice of annual general meeting 
continued 107
to friday alternatively you may appoint a proxy electronically at wwwcapitashareportalcom please see the notes to the form of 
proxy for further details a corporation which is a member can appoint one or more corporate representatives who may exercise on 
its behalf all its powers as a member provided that no more than one corporate representative exercises powers over the same share
3  t o be valid any proxy form or other instrument appointing a proxy must be received by post or online or during normal business 
hours only by hand at capita registrars the registry 34 beckenham road beckenham kent br3 4tu no later than 11am on  
18 april 2011 or 48 hours before the time of any adjournment of the meeting
4  the return of a completed proxy form in writing or online or any crest proxy instruction as described in paragraph 10 below will 
not prevent a shareholder attending the annual general meeting and voting in person if heshe wishes to do so
5  any person to whom this notice is sent who is a person nominated under section 146 of the companies act 2006 to enjoy 
information rights a “nominated person” may under an agreement between himher and the shareholder by whom heshe was 
nominated have a right to be appointed or to have someone else appointed as a proxy for the annual general meeting if a 
nominated person has no such proxy appointment right or does not wish to exercise it heshe may under any such agreement  
have a right to give instructions to the shareholder as to the exercise of voting rights
6  the statement of the rights of shareholders in relation to the appointment of proxies in paragraphs 2 and 3 above does not apply  
to nominated persons the rights described in these paragraphs can only be exercised by shareholders of the company
7   t o be entitled to attend and vote at the annual general meeting and for the purpose of the determination by the company of the 
votes they may cast shareholders must be registered in the register of members of the company at 6pm on the date two days 
before the meeting or  in the event of any adjournment at 6pm on the date which is two days before the time of the adjourned 
meeting changes to the register of members after the relevant deadline shall be disregarded in determining the rights of any 
person to attend and vote at the meeting
8  as at 23 february 2011 being the last business day prior to the publication of this notice the company’s issued share capital  
consists of 38336436 ordinary shares of 50p each carrying one vote each therefore the total voting rights in the company  
as at 23 february 2011 are 38336436
9  crest members who wish to appoint a proxy or proxies through the crest electronic proxy appointment service may do so by using 
the procedures described in the crest manual crest personal members or other crest sponsored members and those crest 
members who have appointed a service providers should refer to their crest sponsor or voting service providers who will be able 
to take the appropriate action on their behalf
10  in order for a proxy appointment or instruction made using the crest service to be valid the appropriate crest message “a crest 
proxy instruction” must be properly authenticated in accordance with euroclear uk and ireland “eui” specifications and must 
contain the information required for such instruction as described in the crest manual the message regardless of whether it 
constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy must in order  
to be valid be transmitted so as to be received by the company’s registrars capita registrars id ra10 by 11 am on 18 april 2011 or 
48 hours before the time of any adjournment of the meeting for this purpose the time of receipt will be taken to be the time as 
determined by the timestamp applied to the message by the crest application host from which the issuer’s agent is able to retrieve 
the message by enquiry to crest in the manner prescribed by crest  after this time any change of instructions to proxies appointed 
through crest should be communicated to the appointee through other means
11  crest members and where applicable their crest sponsors or voting service providers should note that eui does not make 
available special procedures in crest for any particular message normal system timings and limitations will therefore apply in 
relation to the input of crest proxy instructions it is the responsibility of the crest member concerned to take or  if the crest 
member is a crest personal member  or sponsored member  or has appointed a voting service provider  to procure that his crest 
sponsor or voting service providers takes such action as shall be necessary to ensure that a message is transmitted by means of 
the crest system by any particular time in this connection crest members and where applicable their crest sponsors or voting 
system providers are referred in particular  to those sections of the crest manual concerning practical limitations of the crest 
system and timings annual report and accounts 2010
shareholders
12  the company may treat as invalid a crest proxy instruction in the circumstances set out in regulation 355a of the uncertificated 
securities regulations 2001
13  under section 319a of the companies act 2006 the company must answer any question asked which relates to the business being 
dealt with at the meeting unless
 •  answering the question would interfere unduly with the preparation for the meeting or involve the disclosure of  
confidential information
 • the answer has already been given on a website in the form of an answer to a question or
 • it is undesirable in the interests of the company or the good order of the meeting that the question be answered
14  shareholders should note that it is possible that pursuant to requests made by shareholders of the company under section 527 of 
the companies act 2006 the company may be required to publish on a website a statement setting out any matter relating to i the 
audit of the company’s accounts including the auditor’s report and the conduct of the audit that are to be laid before the annual 
general meeting or ii any circumstance connected with an auditor of the company ceasing to hold office since the previous meeting 
at which annual accounts and reports were laid in accordance with section 437 of the companies act 2006 the company may not 
require the shareholders requesting any such website publication to pay its expenses in complying with sections 527 or 528 of the 
companies act 2006 where the company is required to place a statement on a website under section 527 of the companies act 
2006 it must forward the statement to the company’s auditor not later than the time when it makes the statement available on the 
website the business which may be dealt with at the annual general meeting includes any statement that the company has been 
required under section 527 of the companies act 2006 to publish on a website
15  members satisfying the thresholds in section 338 of the companies act 2006 may require the company to give to members of the 
company entitled to receive notice of the annual general meeting notice of a resolution which those members intend to move and 
which may properly be moved at the annual general meeting a resolution may properly be moved at the annual general meeting 
unless i it would if passed be ineffective whether by reason of any inconsistency with any enactment or the company’s constitution 
or otherwise ii it is defamatory of any person or iii it is frivolous or vexatious the business which may be dealt with at the annual 
general meeting includes a resolution circulated pursuant to this right a request made pursuant to this right may be in hard copy or 
electronic form must identify the resolution of which notice is to be given must be authenticated by the persons making it and must 
be received by the company not later than 6 weeks before the date of the annual general meeting
16   except as provided above members who have general queries about the annual general meeting should call our shareholder helpline 
on 0871 664 0300
 y ou may not use any electronic address provided either
 • in this notice of annual general meeting or
 •  any related document including the chairman’s letter and proxy form
 
 to communicate with the company for any purposes other than those expressly stated
notice of annual general meeting 
continued directors’ report
 business review
02 highlights of 2010
04 chairman’s statement
06  a conversation with rob woodward by  
journalist and media commentator ray snoddy
09 chief executive’s review 
 – scotland’s digital media company
10 – broadcasting
14 – content
18 – ventures
22 kpis 20102012
24 performance review
27 principal risks and uncertainties
29 corporate social responsibility
 corporate governance
34 board of directors
36 corporate governance report
44 remuneration committee report
accounts
56  stv group plc consolidated financial statements 
– independent auditors’ report 
58 consolidated income statement
58  consolidated statement  
of comprehensive income
59 consolidated balance sheet
60  consolidated statement of changes in equity
61  consolidated statement of cash flows
62 notes to the financial statements
90  stv group plc company financial statements 
– independent auditors’ report
92 company balance sheet
93 statement of t otal recognised gains and losses
94  notes to the company financial statements
100  fivey ear summary
shareholders
101 shareholder information
103 notice of meeting
designed and produced by t ayburn scotland’s digital 
media company
annual report and accounts 2010
annual report and accounts 2010 stv group plc
in producing this report we have chosen production 
methods which aim to minimise the impact on our 
environment the papers chosen – revive 5050 gloss  
and revive 100 uncoated contain 50 and 100 recycled 
fibre respectively and are certified in accordance with the 
fsc forest stewardship council both the paper mill and 
printer involved in this production are environmentally 
accredited with iso 14001 company registration number sc203873
stv group plc
pacific quay
glasgow g51 1pq
t el 0141 300 3000
wwwstvtv


Summary:
 chairman’s statement
“ with a strong identity and clarity  
of vision we are delivering an 
entertaining and relevant schedule”
 f or financial updates  
on stv visit wwwstvplctv
last year i reported that i believed 2010 
would be a year of considerable change  
and that has certainly been the case both 
within the company and externally  despite 
the economic environment we have 
produced a very good financial result 
against a backdrop of improved national 
revenues and rigid cost control
operating profit before tax and  
exceptional items is £144m and earnings 
before exceptional items tax depreciation 
and amortisation is £169m national 
airtime revenue performed particularly  
well with growth of 21 yearonyear   
while regionally within scotland the  
pace of economic recovery was slower  
and revenue was flat yearonyear   
however  we continued to dominate  
the scottish marketplace 
once again our chief executive  
rob woodward has aligned his interests 
with that of shareholders shareholders  
will recollect that last year 2009 he and 
his colleagues voluntarily reduced their 
salaries this year he has proposed that  
the performance related bonus he has 
earned in 2010 should be deferred  
subject to future performance for up to  
24 months and payable wholly in shares 
our share price is now beginning to  
reflect the new stv and given the strong 
base that has now been established there  
is scope for further value to be created
the disposal of pearl  dean was 
completed and the general improvement  
in stock market prices had a beneficial 
effect on the pension deficit
we are committed to delivering high  
quality public service content and we  
have continued to enhance this through 
the introduction of new platforms and the 
launch of stv local while much has been 
made in the press about our decisions to 
opt out of some network programmes in 
favour of our own produced or acquired 
content the fact is that viewers have 
responded well as demonstrated by the 
increase in our audience share against 
annual report and accounts 2010
directors’ report – business review  whilst we recognise that changes to the 
television market including increased 
competition the growth of online 
advertising and sales house consolidation 
make a review of crr timely any relaxation 
of this mechanism must take account  
of the need to ensure that the merger 
undertakings put in place to protect the 
interests of the nonconsolidated channel 3 
licensees are not disregarded
during 2010 we confirmed our investment 
in mirriad limited the market leader in 
digital product placement as both a content 
maker and national broadcaster offering 
solutions to advertisers mirriad’s products 
and processes are of great value to stv as 
the rules on product placement are relaxed 
during 2010 we contributed to the 
consultation process undertaken by ofcom 
into the rules governing television airtime 
sales and airtime minutage quotas and 
whilst there is no decision expected on 
these imminently we will continue to 
engage with the regulator on this matter 
so having achieved or exceeded the 
majority of our 2010 kpi targets we can 
look forward to 2011 with confidence and 
excitement stv is a company with a 
focused view on its direction of travel  
and has the team in place to achieve  
our 2011 ambitions
none of the achievements of the company 
would have been possible without a strong 
and supportive board a visionary chief 
executive officer and motivated staff  
my thanks go to all of them for their 
extraordinary achievements
richard findlay
chairman
channel 3 itself across the all important 
peak period having said that 95 of  
our programmes are from the network  
to which we pay a considerable sum of 
money but we are always mindful that we 
are a scottish based service independent 
of itv  and have a clear responsibility to 
produce a balanced schedule relevant for 
audiences in scotland
our digital strategy is firmly on track  
and we have exceeded our stretching  
kpi targets in relation to digital audience 
growth our traffic and audience levels 
have surpassed the targets we set for 2012 
and as a result we have set new higher 
targets for 2011 during the course of the 
year we were delighted to have been voted 
the best commercial catchup site in the 
uk this is an achievement we are 
particularly proud of given the financial 
resources of the competing platforms 
developed by our competitors our dedicated 
y outube channel is delivering extremely 
strong monthonmonth growth in video 
streams and we have achieved 22m unique 
users per month exceeding our target of 
17m up 129 on the same time last year  
we have now exceeded our kpi target  
of one million video streams per month 
demonstrating the value placed on  
our content
as other mainstream media reduce 
services to local marketplaces through 
cutbacks increased syndication and 
consolidation we have taken a contrary 
view seeing a service and commercial 
opportunity with the development of stv 
local we piloted this project in one of the 
more difficult geographical areas for media 
and have been so encouraged by the 
results that we are swiftly rolling out the 
concept to other parts of the country 
our ability to generate audiences and 
revenues for our content across different 
platforms is now firmly established adding 
real substance and strength to our position 
as scotland’s digital media company 
the decision not to proceed with the 
piloting of independently funded news 
consortiums by the new coalition 
government was widely expected we did 
not stand still however  and immediately 
began to consider a range of options to 
develop a sustainable solution that would 
allow us to continue to deliver high quality 
news content across scotland in early  
2011 we announced the launch of a pilot  
to trial the delivery of an enhanced and 
more locally focused news service  
this combined with our investment in  
stv local demonstrates our continuing 
commitment to provide high quality  
public service content
we believe that the government’s decision 
that stv productions should not be 
granted independent production status  
is not conducive to supporting the growth 
of the wider production sector in scotland  
we will continue to push for the necessary 
change of mind to achieve this status 
however  regardless of this our content 
team continue to grow commissions from  
other broadcasters including the bbc 
providing clear evidence of its capability 
and creativity 
 
the litigation involving itv will be heard  
in court during the course of 2011 and 2012 
and while we have always regretted being 
forced to take the defensive action we 
have we are confident that our position  
will prove to have been properly justified
our marketplace is highly regulated and  
we anticipate further changes in this area  
in the forthcoming year  we are confident  
in our ability to respond positively and 
embrace regulatory changes most 
significant are the opportunities presented 
by an increased commitment to supporting 
the growth of locally focused media 
services and the investment in high speed 
broadband infrastructure enabling 
enhanced access to our content for 
audiences across all platforms 
05