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annual report  accounts 2013 stv group plc
annual report
 accounts 2013
commercially focused 
creatively led contents
directors’ report
strategic report
01 2013 financial highlights
02 stv – at a glance
04 chairman’s statement
06 chief executive’s review – qa
10 – consumer
18 – production
24 performance review
27 – kpis 20112015
29 principal risks
31 corporate responsibility
corporate governance
38 board of directors 
40 corporate governance report
54 remuneration report
accounts
80  stv group plc consolidated financial  
statements – independent auditors’ report 
84 consolidated income statement
84  c o ns o li d a t e d s t a t e m e n t  
of comprehensive income
85 consolidated balance sheet
86 consolidated statement of changes in equity
87 consolidated statement of cash flows
88 notes to the financial statements
112  stv group plc company financial statements 
– independent auditors’ report
114 company balance sheet
115  statement of total recognised  
gains and losses
116 notes to the company financial statements
122 fiveyear summary
shareholders
123 shareholder information
125 notice of annual general meeting
designed and produced by tayburn 01
stv annual report  accounts 2013
directors’ report – strategic report
2013 financial highlights
another year of strong financial  
results and a further significant  
reduction in net debt
5
2011
£150m
2012
£171m
2013
£180m
operating profit millions

16
2011
£127m
2013
£152m
pretax profit millions

2012
£131m
9
2011
£1020m
2012
£1027m
2013
£1121m
revenue millions
21
2011
£545m
2012
£453m
2013
£357m
net debt millions
 preexceptional items and ias19 directors’ report – strategic report
02 stv – at a glance
•  stv reaches 36 million viewers each 
month with first class programming and 
the most comprehensive local news 
service in the uk 
•  stv productions is one of the uk’s leading 
production businesses with ambitious 
plans for growth in the uk and overseas
•  stv’s digital business incorporates 
scotland’s most popular commercial 
media website stvtv stv recently 
launched new digital services providing  
all the latest news events offers  
pictures and videos for consumers  
in scotland’s four main cities
•  in june 2014 stv will launch stv 
glasgow a brand new cityfocused  
tv channel available on freeview  
sky and online
•  stv content is available across multi 
platforms including ios android ps3 
windows 8 youview and samsung  
smart tv
our business
engagement and cover all stv 
services the key corporate kpis 
detailed on pages 27 and 28 are used 
to monitor and measure the progress 
of each division in fulfilling its strategy 
stv productions
creates and produces high quality  
content for broadcast networks  
in the uk and overseas
profit is made on initial sale and  
on the exploitation of back end  
rights in the uk secondary and 
overseas markets
advertising
content
advertising
     consumers
content 
consumers
our business model
stv consumer
delivers unique high quality content 
to attract mass audiences which  
are sold to advertisers to generate 
revenues the content is delivered 
across multiple platforms including 
digital terrestrial cable and satellite 
online and through connected 
devices such as games consoles  
and smart tvs the business aims  
to use its unique content to create 
communities of interest and to 
engage consumers the kpis have 
been reviewed and new metrics  
will be introduced in 2014 to drive 
increased focus on consumer 
by 2015 we will
•  grow nonbroadcast earnings to represent  
33 of group earnings
• double stv productions’ revenues based on 2011 revenues
•  be the most used digital service in scotland
•  launch two new marketleading digital  
consumer propositions
• maintain our position as the ‘voice of scotland’
our strategic aims as set out in 2012 03
stv annual report  accounts 2013

edinburgh
dundee
glasgow
91
aberdeen
aberdeen
dundee
edinburgh
glasgow
edinburgh
glasgow
covering scotland
stv is scotland’s leading media 
brand connecting with consumers 
and creating opportunities for 
commercial partners across 
channels and platforms at a 
national regional and city level
each month stv reaches  
91 of scots on air 
network coverage
stv’s micro regions offer 
advertisers the opportunity  
to geotarget their tv  
marketing campaigns
micro regions
stv secured licences in early  
2013 for local tv in glasgow  
and edinburgh 
city tv
stv glasgow stv edinburgh  
stv aberdeen and stv dundee 
available to download for free  
as apps 
city apps
superserving scotland  
with relevant locallyfocused 
and engaging content 
key metropolitan areas directors’ report – strategic report
04 chairman’s statement
i was absolutely delighted to  
join the board of stv in 2013  
and to succeed richard findlay 
as chairman growing up in 
scotland in the 1960s stv  
was an important part of my  
life and so it is a great privilege 
for me to join the company 
particularly at such an important 
time for the company and  
for scotland
since june i have observed an 
organisation that is focused on its 
consumer relationships commercially 
and results oriented with a strong 
clarity of purpose objectives and 
targets and driven by a powerful 
creative energy at its heart
across the company there is a palpable 
sense of pride in the brand and the 
strength of connections held with 
consumers and commercial partners 
combined with a clear strategy to 
embrace the opportunities presented 
by a changing media landscape  
i am assured of the potential of the 
company to realise its ambitions 
in particular i am confident the 
company is well positioned to achieve 
its strategic aim of onethird of 
earnings being derived from  
nonbroadcast activities by 2015  
the strategy to deliver this through 
growth of the digital business and 
stv productions combined with 
continuing to build a strong core 
business founded on the deep 
connections held with consumers 
across an increasing range of 
platforms is ambitious and focused 
and provides a clear plan to deliver 
future growth and value creation 
the recent conclusion of the licence 
renewal process for the maximum 
term of 10 years provides certainty 
and a stable backdrop to enable 
continued investment and focus to  
be placed upon new growth activities 
enabling the transformation of stv  
to continue
a year of significant progress 
during 2013 the company has been 
successful in further consolidating  
its leading position in scotland 
through the introduction of new 
ground breaking digital consumer 
services whilst continuing to deliver 
an outstanding quality of public 
service content the success 
achieved by stv productions has 
successfully enhanced its reputation 
as a leading uk production company 
with growing international 
connections
stv holds a unique and ubiquitous 
connection with communities across 
scotland in addition to serving 
communities with high quality 
trusted informative and entertaining 
content new connections are being 
formed through seeking to enhance 
the lives of the most vulnerable 
children in these communities 
founded upon a strong commitment 
to social investment with over £25m 
raised by the stv appeal during the 
2013 campaign
financial performance
good progress has been made 
during 2013 in continuing to diversify 
the structure and revenue base of  
the business with nonbroadcast 
activities now accounting for almost 
20 of earnings this has been 
achieved through further strong 
performance in digital activities  
and growth momentum in stv 
productions arising from a raft of new 
commissions and achievement of the 
key priority of securing commissions 
of returning longrunning series for 
major broadcasters
the balance sheet has further 
strengthened as net debt has 
continued to reduce down 21  
at £357m 2012 £453m a reduction  
of 34 over the past two years  
the company remains on track to 
achieve the target of a ratio of net 
debt to ebitda of one and a half 
times by the end of 2014
profit before tax ias19 and exceptional 
items is £152m up 16 on last year 
and earnings per share on the same 
basis are up 13 at 344p
the underlying profitability of all areas 
of the business continues to perform 
strongly with improving margin 
performance in growth activities 
digital margins increased significantly 
to 40 up from 26 the previous 
year margins also improved in  
stv productions 
the consumer business delivered  
a margin of 178 2012 183  
‘ … continued strength in the overall 
financial position … pleased to confirm 
the return to dividend payments’
margaret ford
chairman 05
stv annual report  accounts 2013
down slightly as a result of higher 
network programme costs overall 
group operating profit has increased 
for the third consecutive year up  
5 at £180m 2012 £171m
signs of some improvement in the 
macro economy have been reflected 
through a modest upturn in consumer 
confidence resulting in an increase  
in national airtime revenues these 
performed in line with expectations 
outperforming the market and  
up 6 at £713m 2012 £674m  
the scottish airtime advertising 
market continues to stabilise with 
performance flat year on year at 
£131m 2012 £131m
the company has a strong culture  
of cost control and a relentless focus 
on operational efficiency balanced 
with a thriving creative energy this 
focus on delivery of commitments is 
demonstrated through the pursuit of 
achievement of the 11 kpis the kpis 
have been reviewed for 2014 and 
beyond and will include increased 
visibility with metrics for consumer 
engagement and reach by platform 
reflecting the multiplatform nature  
of the business
dividend
as a result of the continued strength 
in the overall financial position of the 
group the strength of the balance 
sheet and delivery of a strong 
operational and financial performance 
i am pleased to confirm the return  
to dividend payments 
the board will recommend the 
payment of a fullyear dividend of  
20 pence per share in respect  
of 2013 subject to shareholder 
approval at the annual general 
meeting the dividend will be paid  
on 23 may 2014
i am committed to the introduction  
of creating sustainable value and 
through a progressive dividend  
policy delivering capital return for 
shareholders in the long term
positive growth momentum 
across all areas of the business
stv productions has successfully 
increased the number of new 
commissions secured during the year 
including further commissions of 
longrunning returning series as the 
profile of the business develops in the 
uk and internationally with content of 
the highest quality being developed 
and produced across genres the 
business is now a multigenre creative 
force well positioned for growth in 
2014 with a strong delivery schedule 
and pipeline for new commissions  
to be secured
the success achieved over the  
past year by the news and current 
affairs team has confirmed stv as  
the leading media provider for 
coverage of the campaign on the 
referendum for scottish independence 
which will take place in september 
this coverage will continue in 2014  
with further leaders’ debates along 
with an extensive programme of 
features and coverage delivered 
through stv news and scotland 
tonight online coverage and  
social media
additionally a partnership with 
debating matters to provide the 
opportunity for secondary school 
pupils from every local authority area 
in scotland to debate the big issues  
in the run up to the referendum on 
scottish independence in 2014 has 
been a great success in engaging 
young people in current affairs and 
strengthening connections with 
consumers of the future
 
one of stv’s key differentiators is  
the ability to operate at both a national 
and local level and the introduction  
of the city tv services in 2014  
will augment the local relevance of  
the brand and play a pivotal role in 
fulfilling the aim of super serving 
communities across scotland
creating new prospects  
for future growth
2014 will be an historic year with the 
eyes of the world on scotland and 
stv is in a prime position to deliver 
against this opportunity this will 
present new and positive challenges 
for the news and current affairs team 
and provide an exceptional opportunity  
for the commercial team to increase 
market share
the launch of the first of the city tv 
services will further strengthen the 
relationship with consumers as a new 
channel is added to the stv portfolio 
this will build on the strong progress 
made during 2013 through the launch 
of the digital city services 
the pace of change and opportunity 
facing stv in 2014 will both continue 
to increase as the expectations of 
consumers grow and with a strong 
culture at the core of the business 
founded on employee values to  
be bold stand together and strive  
to surprise the company is well 
positioned to realise these 
opportunities and deliver further 
success in the year ahead
the forthcoming year will be an 
exciting one for everyone associated 
with stv and the company is in a 
strong position to deliver further growth 
and value from that opportunity
on behalf of your board i would like 
to thank our highly committed and 
talented staff and leadership team  
for their exceptional contribution 
during 2013 and thank shareholders 
for their support during a formative 
and successful year for the company
i would finally like to express the 
board’s thanks to my predecessor 
richard finlay and vasa babic who  
is retiring from the board at the agm 
after seven years of very dedicated 
service we have benefited greatly 
from their wise counsel  directors’ report – strategic report
06 chief executive’s review – qa
our focus on  
technology solutions 
is meeting emerging 
consumer needs
rob woodward in conversation  
with andrew billen
‘ we are well positioned  
as the fundamental  
nature of our business  
is changing’ 07
stv annual report  accounts 2013
if ever enthuses rob woodward 
there was a year of scotland then 
it will be 2014 the commonwealth 
games begins in glasgow in  
july the biennial ryder cup golf 
competition comes to gleneagles 
in september and the same month 
the crucial referendum on 
scottish independence is held 
stv will extensively cover each 
event further embedding itself 
into scottish lives not only on 
channel 3 but through its recently 
launched mobile apps and new 
tv city stations in glasgow  
and edinburgh however as  
rob explains 2013 was also  
quite a year for stv…
q you won the licence to 
broadcast on channel 3 in 
scotland again was that just  
a formality
a if you look at the track record of 
stv and itv and utv in meeting  
and exceeding licence obligations it 
was not a surprise ofcom had shown 
that the commercial benefit of the 
licence versus the cost of meeting  
the licence obligations was in deficit 
but we don’t see high quality public 
service as a duty we see it as part  
of our relationship with the audience 
and celebrate it we are nevertheless 
delighted that we now have certainty 
in continuing to provide highquality 
public service through to the end of 
2024 across both our scottish licences
q the other cause for 
celebration is that you are 
paying a dividend this year 
a when i arrived at the company 
seven years ago i set out a route for 
recovery a blueprint for how stv 
was going to rejuvenate itself one of 
the key issues was rebuilding financial 
stability and the financial health of the 
balance sheet we have delivered 
that we said to investors that when 
our ebitda debt to earnings before 
interest tax and depreciation ratio 
dipped down below 2 times that we 
would consider our dividend policy 
we’re now at 18 times and  
i’m delighted to confirm that there  
will be 20 pence per share dividend 
in 2013 and on top of that we’ve 
confirmed the introduction of a 
progressive dividend policy in  
future years
q so it’s been a long wait but it’s 
now coming good for investors 
a we’ve seen a very significant 
recovery in the valuation of the 
business as the investment 
community has realised the strength 
of the business that we’ve built
q what about ratings 
a for the first time in ten years  
our audience has increased over  
the course of a year i think what 
you’re seeing is that the impact of  
the transition from an analogue world 
to a digital world has now finished 
we expect to be able certainly to 
hold that audience stable if not 
continue to show slight growth going 
forward one of our key performance 
indicators kpis is to outperform  
the rest of the itv network and i’m 
delighted that again we’ve managed 
to do that our peak time share being 
15 share points higher than the rest 
of the network
q how is onscreen  
advertising doing
a we’ve seen a recovery back to 
prerecession levels we had a 
particularly strong performance in  
the national market through 2013  
the local scottish market was flat but 
as we head into 2014 we’re expecting 
to see modest growth in both the 
national market and the local scottish 
market television has reclaimed its 
rightful position as the cornerstone of 
the advertising sector i’ve always had 
a long term belief in its power and 
television has more than fought back 
what we’re now seeing is a new 
relationship between online and 
mobilebased advertising versus 
commercial broadcast advertising 
the two compete around the edges 
but they’re actually fundamentally 
complementary one is very much 
about building awareness and the 
other is much more around a call to 
action where to go to get it or where 
to sample it special offers 
q and this is the way forward
a we believe so we’re launching  
a new set of kpis this year and in  
our digital business we’re expecting 
our margin to reach 50 over the 
next three years we believe that it  
will become an increasingly significant 
component of our business another 
of our kpis is to generate a third of 
our earnings from nonbroadcast 
activity between now and the end  
of 2015 
q that aim has been around  
for a while hasn’t it 
a yes but we’ve formalised it  
and we’ve enshrined it as one of  
our 11 kpis
q isn’t that a hostage  
to fortune 
a we want to demonstrate to all 
stakeholders that the fundamental 
nature of our business is changing 
and we’re becoming less reliant on  
a single broadcast product that’s why 
we set out the importance of diversifying 
our earnings it is an organic strategy 
we see strong growth opportunities 
remaining in the markets which we’re 
serving across scotland
q yet stv is also becoming  
ever more local isn’t it 
a yes we are a local brand our 
start point is that we are local to 
scotland we have scotland flowing 
through our veins and our objective  
is to super serve scottish consumers 
with content that they’re unable  
to get anywhere else specifically 
tailored to them it might be watching 
the flagship current affairs show  
scotland tonight it might be  directors’ report – strategic report
08  chief executive’s review – qa 
continued
watching a particular news bulletin for 
your area be it edinburgh glasgow 
aberdeen or dundee but equally we’ll 
also be launching city tv in glasgow in 
june and edinburgh at the end of this 
year these are 12year licences that 
will give us another window to reach 
consumers right across the central 
belt of scotland representing half  
the population 
q are you confident people will 
find these stations at channel 26 
on the epg in england the city 
stations are listed on the first 
page at number 8 
a we will use stv on channel 3 as 
the main marketing platform to ensure 
that our audiences do find what they 
want these will be channels driven 
by telling the stories of what is 
happening in the cities we will be  
on air in time for the commonwealth 
games in glasgow so stv glasgow 
will be the place where we’re able  
to give the people of glasgow airtime 
talking about the impact of the 
games how they got involved what  
it meant for them at the end of this 
year we’ll launch a similar channel  
in edinburgh
q will the two new stations  
look and sound different from 
each other 
a yes because they have to represent 
and reflect their local communities but 
equally they will be very different to 
stv they will enable us to speak with 
a different voice and reflect different 
voices and you know it’s the first 
time in stv’s 50 plus year history  
that we have the opportunity to be 
responsible for and run our own 
channels reaching our own audiences 
through these new services is a really 
exciting prospect and with much lighter 
regulation we’ll be able to experiment 
with new commercial models
q can you get even more local 
a we launched mobile apps for 
edinburgh glasgow aberdeen and 
dundee in october of last year we’re 
delighted by the response they’re 
also there to reflect the life and soul  
of a city if you’re interested in dining 
out if you’re interested in going out  
if you’re interested in what’s happening 
on the news what’s happening on the 
roads on the rail they are already 
developing their own personality and 
own editorial voice we’re positioning 
them as the definitive home of what’s 
happening in scotland’s main cities 
and they’ll be very complementary to 
the city tv services you’ll also start 
to see them playing the role of a 
second screen in your hand enabling 
our consumers to upload content 
directly on to stv glasgow or stv 
edinburgh so if you’re out and about 
in the city and you see something that 
you think is of real interest then you’ll 
be able to be that citizen journalist 
video it and upload on to our site
q will these apps make money 
a they’re free apps but they are  
ad supported our philosophy is  
that stv’s content irrespective  
of platform is free to consume  
and there’s been a 50plus year 
relationship between brands and our 
content which consumers are very 
used to seeing on screen we’re 
simply extending that relationship 
across all other platforms
q the strategy is ‘mobile first’ 
which is what everybody says 
now don’t they
a we’ve been putting mobile first  
for the last year we said a year ago 
that all future development would be 
driven through mobile platforms and 
then we would develop accompanying 
desktop derivatives to support our 
mobile products
q will you also be on smart tvs 
besides samsung 
a we’ll work with all the leading smart 
tv developers this year we’ve launched 
apps with samsung we’ve launched 
on windows 8 we’ve launched on 
kindle we have a healthy 
development pipeline and set of 
development priorities to ensure that 
our content is available across as 
many platforms as possible we took 
a view on what our audiences would 
demand and consumers would want 
to consume 
we’ve also changed the style of 
development so we’re now what’s 
referred to as an agile developer it’s a 
methodology which we employ which 
enables us to move very quickly 
incorporating many different 
disciplines from across the business 
q i’m imagining a lot of young 
scotsmen in glasgow dressed in 
tshirts and drinking irn bru – a 
scottish siliconvalley startup 
a they do drink irn bru and they  
do tend to wear tshirts it is like a 
startup we have in my view the 
best of both worlds we have a 
fantastic heritage a brand which has 
a ubiquitous reach and within that 
we’re fostering a startup mentality 
we’re doing things that no other 
media company has done in particular 
no other media company will have the 
same combination of assets as we have 
q because they don’t have a 
free tv presence
a also our focus on reaching local 
audiences through digital and mobile 
products is unique
q how will you be covering the 
referendum as it gets ever closer
a we started in 2013 by being the 
first broadcaster to broadcast live 
debates between the yes campaign 
and the better together campaign 
the audience reaction was extremely 
positive we’ll continue those live studio 
debates we also have plans to have 
live debates in front of audiences on 
location across scotland and we 
have comprehensive plans to cover 
the night of september 18 09
stv annual report  accounts 2013
q is the referendum debate 
pushing audiences towards 
scotland tonight
a scotland tonight has established 
itself as by far and away the leading 
current affairs show in scotland we’re 
typically achieving an audience around 
about three times that of newsnight 
scotland we’ll continue to use that as 
our flagship programme we regularly 
extend that programme into a onehour 
format where we take a deep dive into 
particular issues of the day and would 
expect to continue to do that through 
the runup to the referendum
q so stv productions  
has it had a good year
a we’ve had a great year we’ve had 
32 increase in revenues we’ve 
transformed the business from when 
we had a single client five years ago 
which was itv we had a single brand 
in taggart that was decommissioned 
and we basically rebuilt by focusing 
on two areas one is daytime and 
we’ve had great success with the 
bbc in antiques road trip and 
celebrity antiques road trip –  
and the other is entertainment just 
three years ago we didn’t have an 
entertainment format and as of now 
we have six returnable formats which 
we are producing 
q i suppose if there’s a uniting 
theme to programmes such as 
itv’s catchphrase and fake 
reaction on itv2 it is that they 
are not tartan they don’t look 
like scottish programmes
a no we are a producer of highend 
content which happens to be produced 
by a scottish based producer our 
strategy was to set out to become a 
multigenre producer and that’s exactly 
what we are doing from a standing 
start we now have a business which 
is delivering over 30 increases in 
revenue growth and we have an 
ambition as a kpi to double the size 
of the business by the end of 2015 
from 2011 levels
q what about documentaries 
a we produced two landmark 
documentaries last year piper alpha 
and the lockerbie bombing piper 
alpha was awarded a scottish bafta 
and the audience award at the 
edinburgh international film festival 
with lockerbie we worked with the 
us smithsonian channel as partners 
we’ve also developed a new 
relationship with red arrow as our 
new international distribution partner 
to export either our formats or our 
finished products
q what is stv doing in the 
charity business 
a it is about ensuring that we use  
the convening power of stv to 
highlight the horrendous situation  
of child poverty in scotland where 
one in five children grows up below 
the recognised poverty line together 
we believe that we can do something 
about it our ambition is over the 
years to use that convening power 
our fundraising power our ability to 
tell stories and build awareness to 
eradicate child poverty from our 
vocabulary in scotland it’s fantastic 
to have the generous support of  
sir tom hunter sir ian wood and  
the scottish government in meeting 
our ambitions
q it’s not a kpi 
a but it’s rapidly become a very 
important part of stv’s dna and  
it’s forming a different component of 
our relationship with our consumers 
who have responded in their millions 
through the donations that have been 
given £25million in the past year
q that’s a very good example  
of consumer engagement but 
consumer engagement seems  
to be at the core of your strategy 
a we see there’s an increasing trend 
to make tv an active experience as 
opposed to a passive occupation  
it’s not for everybody all the time but 
it is for some people some of the time 
we consider ourselves at the forefront 
of offering the most engaging array of 
complementary services some 91 
of scots watch stv in a month but 
we’ve also got an audience of over  
3 million online and mobile viewers 
q given there are only  
5 million people in scotland  
i find that incredible 
a i think what is incredible is if you 
look back online five years ago we 
had something in the order of 50000 
unique users we’ve gone from that  
to over 3 million users 
q ten years ago scotland 
seemed to have fallen out of  
love with stv does scotland 
love stv again 
a i think it’s a work in progress  
our relationship with our consumers 
is evolving we’re not harking back  
to what stv used to be we’re forging 
new relationships with new consumers 
trying to position stv right at the 
heart of the highest quality 
entertainment the highest quality 
news the highest quality current 
affairs and then sitting beneath  
that forge a connection across 
communities across the country
conclusion
as the world looks  
to scotland in 2014 
scotland looks set to 
be following stv in 
ways old and new  earlier this year it was confirmed 
that stv had secured renewal  
of its two channel 3 broadcast 
licences for a further 10 year 
term this provides longterm 
certainty for the business and 
allows us to concentrate on  
our strategy of diversification  
and growth 
progress towards achievement of  
the strategy is measured against  
our kpis the kpi metrics and targets  
for 2014 to 2016 have been reviewed 
and new measures introduced 
additionally we have incorporated our 
strategic aims of onethird earnings 
from nonbroadcast activities into the 
kpis to ensure operational focus on 
achievement of this
super serving scotland’s cities
we are committed to delivering 
relevant and engaging content to  
our consumers this is underpinned 
by a strategic aim to launch two new 
market leading digital consumer 
propositions by 2015 
directors’ report – strategic report
10 chief executive’s review – consumer
super serving 
scotland
online
in october 2013 we launched the  
first of these as four brand new city 
apps the city apps bring consumers 
in scotland’s four largest cities all the 
latest news social media updates 
travel weather and upcoming events  
stv glasgow stv edinburgh  
stv aberdeen and stv dundee  
are available as apps free to 
download and use on ios and 
android devices and accompanying 
desktop and mobile derivatives  
the innovative development of the 
city apps has led us to protect our 
intellectual property with several 
aspects of the apps submitted for 
patents in the us and eu the mobile 
first approach to delivering content 
reflects the growing trend in 
consumers accessing our material  
via mobile devices 
the city apps are designed to offer  
the user ‘your city in your hand’  
we are delighted with the initial 
response from consumers and plan 
to build on the successful launch  
in 2014 with additional marketing 
activity furthermore we are 
confident of achieving our new kpi  
of 1 million monthly users by 2016  
to help realise our ambition to be the 
most used digital service in scotland
the city apps reinforce our commitment 
to serving scottish consumers as we 
continue to deliver local news on air as 
well as online allowing the news team 
to prioritise stories relevant to the 
regional audience
on air
during itv’s morning daybreak 
programme stv news broadcasts 
three bulletins for north and central 
scotland two lunchtime bulletins  
are broadcast from glasgow for the 
east and west and from aberdeen 
for the north 
our dedicated evening news 
programmes stv news at six are 
broadcast from glasgow aberdeen 
and edinburgh with a bulletin for the 
dundee and tayside area evening 
news bulletins are also broadcast 
from glasgow edinburgh and 
aberdeen during stv’s current affairs 
programme scotland tonight on air 
monday to thursday we deliver in 
excess of our licence obligations for 
news and are committed to continuing 
this in the new licence period 
nonbroadcast  
earnings share 
2012  actual 11
2013 actual 19
2015 target 33
2011  actual 11
consumer division  
margin 
2014 target 165
2015 target 175
2016 target 180
2013 actual 178
2012 actual 183
2011 actual 155 11
stv annual report  accounts 2013
‘ y o ur cit y  
in your hand’
we have reaffirmed our 
commitment to super serving 
scotland with the launch of  
stv glasgow stv edinburgh  
stv aberdeen and stv dundee  
as brand new city apps for the 
country’s largest cities dedicated 
regional news coverage continued 
on air in 2013 and in the coming  
year we will launch two local tv 
channels for glasgow and edinburgh
what does this mean  
for our consumers 
they receive relevant and engaging 
content that is locally focused and 
delivered with mobile consumption 
in mind
what does this mean  
for stv 
we have the ability to prioritise local 
news and establish new platforms 
for our commercial partners to reach 
their target audiences 
super serving  
stv cities
image stv city apps offer  
the user ‘your city in your hand’ directors’ report – strategic report
12  chief executive’s review – consumer 
continued
 1 1 5m long  
form streams  
in 2013 
image the stv player offers  
catchup of channel 3 content  
within stv’s licence areas
anywhere anytime
stv has a key strategic aim to 
provide our content free to 
consumers ‘anywhere anytime’  
in 2013 the stv player launched  
on windows 8 samsung smart tv 
and kindle fire allowing viewers 
within our licence areas to access 
catchup content on an increasing 
number of platforms 
what does this mean  
for our consumers 
they are able to access their 
favourite stv shows on the 
platforms they choose 
what does this mean  
for stv 
this gives us the ability to monetise 
our content on multiple platforms 13
stv annual report  accounts 2013
in early 2013 stv secured two local 
television licences to broadcast across 
glasgow and edinburgh stv glasgow 
will start broadcasting on freeview 
virgin media and sky in june 2014 
with the launch of edinburgh to follow 
the new channels will reach a potential 
audience of almost 2 million in 
glasgow and 15 million in the capital 
following launch the new local tv 
channels for glasgow and edinburgh 
will work in tandem with the city apps
at the end of the year a recruitment 
campaign was launched offering  
a wide range of opportunities to  
get involved in the launch of this 
exciting new service a talented  
and enthusiastic multiskilled team 
are now in place and are preparing  
for launch
the addition of the new city services 
and local tv channels offer a unique 
combination of platforms for audiences 
to consume our content this gives 
stv an unrivalled service in scotland 
and offers a wealth of targeted 
advertising opportunities  
to our commercial partners 
delivering relevant content 
we strive to offer our consumers  
the best channel 3 network content 
complemented by original scottish 
programming public service 
broadcasting is at the heart of stv’s 
core channel and we continue to excel 
in the delivery of quality engaging 
and accessible content stv news at 
six achieved an audience share of 
256 throughout the year with high 
profile stories including the clutha 
helicopter crash storm force gales 
and snow and news on rangers  
and hearts football clubs 
to commemorate the 25th 
anniversary of the piper alpha 
disaster in july stv news at six 
presenter for the north andrea 
brymer broadcast live from the 
hummingbird installation over  
100 miles north east of aberdeen 
in the run up to the referendum  
on scottish independence in 2014 we 
have demonstrated our commitment 
to provide a platform for debate on  
all the big issues current affairs 
programme scotland tonight has 
hosted four debates with members of 
the better together and yes scotland 
campaigns this will continue in the 
run up to the vote on 18th september 
2014 with live leaders’ debates 
planned throughout the year 
scotland tonight continues to be  
the most watched scottish current 
affairs programme airing each week 
monday to thursday reporting on  
all the topical issues of the day the 
format of the programme provides  
the flexibility to deliver indepth 
coverage of key news events 
for example the resignation of 
cardinal keith o’brian in february 
resulted in an stv news at six 
broadcast live from edinburgh the 
scotland tonight programme that 
followed the same evening on the 
resignation of cardinal o’brien was 
one of the best performing scotland 
tonight’s of the year up 32 on the 
average programme performance 
with 84 share demonstrating our 
news team’s ability to respond quickly 
to developing stories in a constantly 
moving editorial landscape 
new kpis are being introduced to  
measure reach and engagement levels  
across all of our channels and platforms
stvtv 2013 actual 30
stvtv 2016 target 36
consumer reach  
monthly average million
tv audience 2013 actual 36
tv audience 2016 target 36
stv player 2013 actual 05
stv player 2016 target 10
city apps 2013 actual 02
city apps 2016 target 10
city tv 2013 actual launches 2014
city tv 2016 target 10
stvtv 2013 actual 3
stvtv 2016 target 6
consumer engagement  
mins per day per user
tv audience 2013 actual 41
tv audience 2016 target 41
city apps 2013 actual 2
city apps 2016 target 6
city tv 2013 actual launches 2014
city tv 2016 target 10
stv player 2016 target 41
stv player 2013 actual 37 directors’ report – strategic report
14  chief executive’s review – consumer 
continued
stv continued to attract an audience share 
ahead of the itv network and average 
peaktime audience increased yearonyear
in june stv aired a unique three
part series examining the history and 
development of the independence 
question in scotland road to 
referendum included exclusive 
interviews with the prime minister and 
first minister along with a wide range 
of politicians cultural commentators 
and wellknown scottish faces
in 2013 we broadcast top commercial 
programmes including the x factor 
and coronation street
the best watched programme of  
the year on stv was the england vs 
scotland football match in august 
which delivered an average audience 
of 12 million and 63 share football 
continues to be a popular choice for 
stv viewers with positive ratings for 
our uefa champions league 
specials in february stv sports 
presenter raman bhardwaj was 
joined by special guests henrik 
larsson and david moyes at celtic 
park for celtic’s match against 
juventus the special programme 
achieved an average audience of over 
850000 winning its slot with a reach 
of nearly 14 million viewers 
our peaktime share across the  
year was the highest in three years  
in 2013 the peaktime share grew  
by 13 share points yearonyear to 
2212 meaning we tracked 15 share 
points ahead of the itv network a 
key kpi for the consumer business
the growth in share makes stv the 
best performing channel in scotland 
from september to december we 
were the best watched peak time 
channel in scotland with a higher 
viewing share than bbc one scotland  
in december with two major network 
shows on air our peak time share 
was 292 – the highest of any 
channel in scotland overall across 
2013 our peak time audience 
increased by 5000 yearonyear to 
405000 viewers while in scotland  
the bbc channel 4 and channel 5 
peaktime audiences dropped 
we also broadcast original content 
such as the new series of scottish 
passport and moviejuice including  
a one direction special which 
premiered on the stv player  
ahead of transmission hosted  
by grant lauchlan
at the start of 2013 a onehour 
documentary went in search of 
robert burns with actor david 
hayman exclusively unveiling what 
scotland’s most famous poet really 
looked like a lifesize model of robert 
burns’ head was reconstructed using 
stateoftheart forensic technology 
by professor caroline wilkinson and  
a team at the university of dundee 
sponsored content was broadcast in 
the form of coached off the couch 
passing it on and rbs – finding 
scotland’s real heroes creating 
innovative ways for commercial 
partners to reach their target markets 
we also aired a number of acquired 
programmes including scottish 
charity mary’s meals’ child 31  
and silent odyssey about the 
remarkable journey of scot gerry 
hughes the first deaf person to sail 
singlehanded around the world 
passing all five capes
stv’s charity the stv appeal also 
contributed to a number of hours of 
original content in its third year the 
appeal raised £25 million for children 
and young people in scotland living  
in poverty the yearlong campaign 
was supported with a series of 
fundraising programmes that 
culminated in a live friday night show 
hosted by lorraine kelly the week  
of appeal programming reached  
23 million scots that amounts  
to six in ten adults within the stv 
transmission area
providing free to consume 
content across all platforms
the launch of the city apps cements 
our commitment to deliver free 
content for our audience on multi
platforms as we continue to progress 
our ‘anywhere anytime’ strategy 
in 2013 we launched the stv player 
on windows 8 samsung smart tv 
and kindle fire these new devices 
join a wide range of platforms already 
hosting the stv player including 
youview ps3 ios tablets and 
smartphones android tablets 
smartphones and the web the stv 
player allows viewers within the stv 
licence areas of scotland to catch up 
on stv programmes and is achieving 
over one million longform streams 
per month 
we have also invested in the 
architecture of the stv player to 
ensure the best possible user 
experience the upgraded design 
includes more predominant categories 
performance vs  
itv network
2013 actual 15pts
2012 actual 13pts
2011 actual 085pts
2014  target 08
consumer insights records 
million
2015 target 16
2016 target 24
2013  actual 06
2012  actual 05
2011 actual 03 15
stv annual report  accounts 2013
serving our 
commercial partners
in 2013 we aired a brand new 
series rbs – finding scotland’s 
real heroes to celebrate inspiring 
scots who go the extra mile for  
their community the series 
presented by carol smillie paid 
tribute to people whose hard work 
ingenuity ambition and generosity 
has improved local communities 
across scotland and their work was 
recognised at a star studded awards 
ceremony on stv the series was 
complemented by a dedicated 
microsite for viewers to vote  
for their real hero 
what does this mean  
for our consumers 
branded content allows us to create 
original scottish programmes for 
our audience
what does this mean  
for stv
we can offer innovative advertising 
solutions to our commercial 
partners to reach their target 
consumers
rbs  
campaigns  
on stv player 
stvtv  stv 
image carol smillie presented  
sponsored series rbs – finding scotland’s 
real heroes directors’ report – strategic report
16  chief executive’s review – consumer 
continued
no1 scottish 
current affairs 
programme 
engaging public 
service content
stv combines the best channel 3 
network content with original 
scottish programming news and 
current affairs is at the heart of what 
we deliver to audiences across 
scotland with seven news bulletins 
each week day and current affairs 
programme scotland tonight on air 
four week nights we are committed 
to providing a platform for all of the 
big issues and will continue this 
commitment in the run up to the 
referendum on independence in 2014
what does this mean  
for our consumers 
stv viewers receive their favourite 
entertainment shows alongside 
informative news and current  
affairs programming 
what does this mean  
for stv 
due to relevant engaging and 
entertaining content stv was the 
best performing channel in scotland 
in 2013 with our peak time share 
growing to 222 
image stv broadcasts relevant and 
engaging content including popular current 
affairs programme scotland tonight 17
stv annual report  accounts 2013
the kpi targets will continue to include 
measurement of digital revenues and margin and 
a new target measuring the key revenue source 
of longform video streams is being introduced
the series presented by carol smillie 
paid tribute to people whose hard work 
ingenuity ambition and generosity has 
improved local communities across 
scotland and their work was 
recognised at a star studded awards 
ceremony broadcast on stv the 
series reached just under 1 million 
scots across the series with an average 
audience of 218000 and 114 share
stv delivered extensive scale and  
cut through on multiplatforms for 
supermarket chain lidl ‘lidl 
surprises’ was one of the biggest on 
air campaigns of 2013 and included 
mystery drama sponsorship including 
law  order one minute programmes 
with a cooking theme produced by 
stv creative tv advertising channel 
sponsorship online digital takeovers 
including wallpapers display and 
themed features for example an 
interview with the band that performed 
the song in the tv adverts
the campaign was lidl’s biggest 
marketing push with previous 
campaigns concentrated on  
in store leaflets flyers and press 
the commercial team strives to  
create multiplatform campaigns that 
deliver results for clients the ability  
to regionalise campaigns depending 
on the geographical requirements of 
the client ensures they are responsive 
to market demands
digital revenues 
£ million
2014 target 85
2015 target 110
2016 target 130
2013 actual 75
2012 actual 65
2011 actual 71
digital margin 

2014 target 45
2015 target 50
2016 target 50
2013 actual 40
2012 actual 26
2011   actual 17
long form video streams 
million
2014 target 140
2015 target 180
2016 target 205
2013 actual 115
2012  actual 51
2011   actual 39
clearer navigation improved access 
to popular content and greater 
flexibility to showcase top shows  
the new format also allows the screen 
view to adapt to any device whether 
consumers are watching their favourite 
stv programme on a smartphone 
tablet desktop or television
our relationship with itv ensures that 
the stv player is geolocated within 
our licence areas to ensure stv 
viewers can access channel 3 
content exclusively on the stv player 
this supports our commercial strategy 
to increase the number of longform 
views in 2013 the total number of 
longform streams was 115 million 
an increase of 125 from 2012 
deepening our consumer 
relationships 
we are continually looking for ways  
to develop our understanding of our 
consumers’ behaviour and are exploring 
a number of ways to generate data 
through transactional services 
registration and loyalty awards 
the number of consumer insights  
we hold on our database is nearly 
600000 up by 25 yearonyear
through our partnership with gigya 
the deployment of their social 
infrastructure technology has 
provided further opportunities to 
garner consumer data and will be  
fully integrated in 2014 
these initiatives form a pivotal 
component of our future strategy  
to build consumer insights and will 
ultimately enable us to provide 
personalised content services for  
our consumers and advertisers
delivering innovative  
commercial partnerships 
two series of branded content aired 
throughout the year with programme 
sponsors the scottish government 
revisiting the families that were 
coached off the couch in 2012  
the three new episodes presented 
by kelly cates encouraged previous 
participants to pass on their new 
active lifestyles to families friends  
and colleagues 
rbs sponsored a brand new series 
rbs – finding scotland’s real 
heroes which celebrated scotland’s 
most deserving community heroes  directors’ report – strategic report
18 chief executive’s review – production
stv productions has firmly 
established itself as a thriving content 
business securing commissions 
across a number of genres and 
delivering new series for the majority 
of uk broadcasters the strategy  
for growth is underpinned by the 
principles that wherever possible  
we retain the rights to programme 
formats create returnable formats 
and produce programmes that 
enhance the business’ reputation  
in 2013 productions revenues were 
up to £135m showing a significant 
growth of 32 from the previous year 
building an international business 
in october we announced a new 
strategic international partnership  
with red arrow entertainment  
group the deal incorporates 
coinvestment codevelopment  
and worldwide distribution 
the partnership enables stv 
productions and red arrow 
entertainment group to work closely 
together to develop brand new 
formats for the uk and international 
markets newly created formats will 
then be coproduced and piloted  
on stv’s core channel in scotland 
before being launched internationally 
in addition from january 2014 
munichbased red arrow international 
became stv productions’ worldwide 
distributor for completed programmes 
and formats outside the uk
delivering  
growth from  
a multigenre 
strategy
our strategy for growth is 
underpinned by three principles 
retention of rights returnable formats 
and enhancement of reputation
production revenue 
£ millions
2014 target 168
2015 target 200
2016 target 230
2013 actual 135
2012      actual 102
2011        actual 84 19
stv annual report  accounts 2013
best performing  
game show for 
 1634 year olds
returnable formats 
in 2013 stv productions  
brought back iconic game show 
catchphrase to sunday evenings on 
itv nine episodes of the primetime 
series hosted by stephen mulhern 
aired in spring including a celebrity 
edition the show returned for a 
christmas special and the second 
series will continue on air in 2014 
catchphrase has proved to be a 
popular format with good potential 
for repeat commissions 
image stephen mulhern presents  
stv productions catchphrase directors’ report – strategic report
20  chief executive’s review – production 
continued
securing rights 
stv productions exclusively  
owns the rights to the antiques 
road trip and celebrity antiques 
road trip formats eight series  
of antiques road trip and three 
series of the celebrity version have 
been delivered to bbc one and 
bbc two with further commissions 
already confirmed in addition  
to the first run on bbc one and  
bbc two both series have been 
acquired by uktv’s yesterday 
channel the programmes have  
also sold internationally with 
acquisitions from broadcasters in 
countries including australia new 
zealand denmark and sweden 
bbc one  
one of top 
five daytime 
shows 
image james martin and jodie kidd  
take to the antiques trail 21
stv annual report  accounts 2013
in conjunction with this partnership 
stv productions will continue its 
innovative format deal with us 
production company kinetic content 
part of the red arrow entertainment 
group in 2010 the businesses 
announced an exclusive agreement  
to license each other’s original 
formats in their respective countries
stv’s relationship with key commercial 
partner groupm entertainment also 
continues with cofunding for a number 
of productions such as let me entertain 
you for itv the lie for tv3 and stv 
and pothole britain for channel 5 
the international sales of existing 
programmes continued in 2013  
with popular programmes including 
taggart antiques road trip and 
rebus acquired by broadcasters in 
countries including australia new 
zealand denmark and sweden 
in 2013 stv productions secured  
a number of commissions from 
international broadcasters the 
smithsonian channel in america 
cocommissioned the lockerbie 
bombing along with stv to mark the 
25th anniversary of the disaster and 
tv3 in ireland ordered ten episodes 
of the lie 
the increasing slate of specialist 
factual programmes includes two 
egyptology documentaries including 
a new theory on what killed 
tutankhamen which starts filming in 
2014 these documentaries will see 
further international development and 
coproduction opportunities in the 
year ahead with interest from two 
north american partners
creative force 
the productions business gained 
momentum throughout 2013 with 
over 20 commissions secured in  
the period at this scale we engage 
approximately 700 freelancers on an 
annual basis creating opportunities 
within the creative industries across 
scotland and london
new creative formats were 
commissioned and will be aired in 
2014 these include the lie a 
general knowledge quiz with a 
difference – there are no questions 
instead a team of two contestants 
compete to win a cash prize by 
identifying the one lie from a set  
of otherwise true statements  
eight episodes for stv are hosted  
by comedian susan calman and  
ten episodes for tv3 will be  
hosted by jonathan mccrea
itv commissioned eight episodes  
of stv productions innovative 
entertainment show let me entertain 
you the show combines the best 
online content with contributors’ 
funny entertaining and ridiculous 
videos to create a programme filled 
with extraordinary usergenerated 
content these shows are in production 
and will be on screen in 2014 
bbc one also commissioned 25 
episodes of the link for daytime 
audiences the brand new quiz show 
produced in association with ltv 
sees three teams compete to find the 
link between a series of questions to 
win money the show will be produced 
and broadcast in spring 2014 warner 
bros international television distribution 
has been confirmed as the global 
distributor to bring the brand new 
format to the international market
stv productions’ programmes on  
air in 2013 included popular daytime 
cookery show country show cook 
off twenty episodes of the series 
followed britain’s best loved celebrity 
chefs as they went headtohead at 
cooking competitions at country 
shows and specialist food festivals 
across the country 
ratings success antiques road  
trip and the celebrity version both 
returned in 2013 with a total of 80 
hours and 30 hours of reversions 
delivered for bbc one and bbc two 
2013 was the most successful year  
so far for antiques road trip with  
a move to bbc one and a place in 
the channel’s topfive daytime 
programme series the january and 
february episodes achieved an 
average audience of 23 million while 
the series in november maintained its 
audience averaging 22 million viewers 
the third series of celebrity antiques 
road trip returned to bbc two 
delivering an average audience of  
18 million viewers per episode  
a 25 increase on the previous series 
in 2012 
both represent a key success of the 
productions business to develop 
returnable series previous episodes 
of antiques road trip and celebrity 
antiques road trip have been 
acquired by uktv’s yesterday 
channel with further episodes 
commissioned for 2014
diversification of genres 
the strategy to secure commissions 
across multiple genres contributed  
to a key growth metric in 2013 with  
an increase in the total number of 
production hours the 2013 target  
of 150 hours was exceeded with  
157 hours delivered this reflects  
an increase of 16 hours on the 
previous year
our new production kpi targets focused  
on revenue and margin demonstrate the  
scale of our growth ambitions this includes stv productions’  
first feature film fire in the night  
the film was made to commemorate 
the 25th anniversary of the piper 
alpha disaster and was aired on bbc 
two following a cinematic release 
fire in the night launched at the 
edinburgh international film festival  
in june 2013 and was awarded  
the acclaimed audience award  
the film was also recognised with  
a bafta scotland award for best 
single documentary
fire in the night was produced by 
stv productions and berriff mcginty 
films with funding from bbc scotland 
and creative scotland and benefiting 
from the uk feature film tax break
a further documentary was produced 
to commemorate the 25th anniversary 
of the lockerbie disaster the lockerbie 
bombing combining footage from 
stv’s news archives including some 
material that had never previously 
been broadcast with moving 
testimonies from local residents  
the onehour programme was 
acquired by itv to broadcast on the 
network to mark the anniversary
two oneoff documentaries were 
delivered for channel 5 fighters’ 
wives the world of mma aired in 
january revealing what it takes to  
be the partners of the men who  
earn their living in britain’s toughest 
profession mixed martial arts 
pothole britain was broadcast on 
channel 5 in december achieving an 
average audience of 1 million viewers
the diverse work of the productions 
team included the delivery of  
three historical crimedrama 
documentaries for bbc alba the 
gaelic programmes examined the 
crimes of edward pritchard donald 
merrett and eugene chantrelle 
stv productions remains committed 
to the development of drama formats 
and a pilot for australian format laid 
has been announced for itv2  
in addition to programmes for several 
of the main broadcasters stv 
productions is responsible for all the 
programming for the stv appeal and 
branded content for stv including 
the young scot awards rbs – finding 
scotland’s real heroes and 
coached off the couch – passing it 
on sponsored by the scottish 
government
the productions team also made 
road to referendum commissioned 
by stv which was acquired as a 
onehour special by itv as part of 
their current affairs coverage on the 
scottish referendum on independence
entertainment was a particularly strong 
growth genre with recommissions for 
13 episodes of catchphrase including 
four celebrity specials for itv and ten 
episodes of fake reaction for itv2 
catchphrase hosted by stephen 
mulhern reached 219 million viewers 
across 2013 with an average 
audience of 49 million per episode  
it was the best watched itv game 
show across 2012 and 2013 for  
the hard to reach 1634 audience
the fake reaction audience grew 
throughout the first series increasing 
by 20 from the first transmission  
to the last episode the average 
audience of the firstrun episodes  
was 442000 meaning the series 
reached over 2 million viewers across 
the series the second series of each 
show is on air in 2014
in june jo brand’s great wall of 
comedy was broadcast on uktv 
gold five episodes of the chat show 
hosted by comedian brand with barry 
cryer and rebecca front were 
commissioned for uktv’s flagship 
comedy channel gold 
looking to 2014 a number of 
productions have already been 
commissioned as we work towards 
our strategic aim to double stv 
productions revenues by 2015 
directors’ report – strategic report
22  chief executive’s review – production 
continued
stv productions is a multigenre creative  
force with a strong delivery schedule and 
pipeline for new commissions
production margin 

2014 target 5
2015 target 6
2016 target 7
2013 actual 3
2012      actual 2
2011 actual 6
rob woodward
chief executive 23
stv annual report  accounts 2013
enhancing 
reputation 
in 2013 stv productions made  
fire in the night and the lockerbie 
bombing fire in the night is  
stv productions’ first featurelength 
film the documentary made to 
commemorate the 25th anniversary 
of the piper alpha disaster opened 
at the edinburgh international film 
festival in june 2013 to much critical 
acclaim the lockerbie bombing 
aired in december 2013 to mark the 
25th anniversary of the lockerbie 
disaster the onehour documentary 
was ordered by the smithsonian 
channel in america and stv  
both documentaries reinforce  
stv productions’ position as  
a producer of high quality  
groundbreaking content 
bafta  
scotland winner 
best single 
documentary 
image stv productions documentary  
fire in the night commemorated the  
25th anniversary of piper alpha directors’ report – strategic report
24 performance review
our businesses have continued  
to perform well this year 
delivering revenue and profit 
growth combined with significant 
net debt reduction our 2015 
strategic objective of achieving 
33 of total earnings from 
nonbroadcast areas remains on 
track with 19 achieved in 2013 
up from 11 last year 
performance against the existing  
kpis has been robust with 5 
exceeded and 6 not achieved  
and we have refreshed our kpis  
and updated the targets to cover  
the period through to 2016 
in february 2014 our bank facility  
was extended to march 2016 
following completion of the broadcast 
licence renewal process and net debt 
at the year end was down 21 at 
£357m 2012 £453m 
revenue 
total revenue was up 9 at  
£1121m 2012 £1027m driven  
by growth in broadcast digital  
and productions revenues 
consumer revenues at £986m  
2012 £925m reflect a strong airtime 
performance with national airtime 
revenues up 6 outperforming  
the broader television market
digital revenues grew by 15 to 
£75m 2012 £65m with digital 
growth revenues up 23 as long
form catchup viewing continued  
to grow strongly 
productions revenue grew by  
32 to £135m 2012 £103m  
as the business continues to win  
new commissions and remains on 
track to more than double its 2011 
revenues by 2015
operating profit 
operating profit before exceptional 
items increased by 5 to £180m 
2012 £171m consumer division 
operating profit grew by £07m  
to £176m 2012 £169m with 
margins ahead of the kpi target  
and broadly flat on last year at  
178 2012 183 this was  
an excellent performance given  
the significant £21m increase in 
network programme costs in the 
period and continued investment  
in our digital services 
productions operating profit was 
doubled to £04m 2012 £02m 
although this business remains in  
the investment phase of its rebuilding 
and expansion plan as revenue 
grows in future years we expect  
to see margins improve which is 
reflected in the updated kpi targets 
finance costs 
net finance costs decreased by £17m 
to £37m 2012 £54m principally due 
to a reduction in cash interest costs  
of £12m this resulted from net debt 
falling together with a lower interest 
margin paid due to a reduction in the 
net debt ebitda ratio 
exceptional items 
there were no exceptional items in 
2013 2012 had a £53m charge net 
of tax for the final accounting of the 
itv settlement and related change  
to affiliate status 
statutory result 
the statutory result for the year after 
tax and exceptional items amounted 
to a profit of £114m 2012 £49m 
the group’s effective tax rate has 
stabilised at 15 2012 15 as  
prior year losses are being utilised 
corporation tax payments will resume 
in 2015
earnings per share 
eps before exceptional items and 
ias19 noncash pension interest 
amounted to 344p up 13 2012 
304p on a statutory basis eps 
amounted to 322p 2012 130p 
george watt
chief financial officer
‘  total revenue was up 9 at £1121m 2012 
£1027m driven by growth in broadcast  
digital and productions revenues’
operating profit  
million
2011 £150m
2012 £171m
2013 £180m
2010 £144m
5 25
stv annual report  accounts 2013
balance sheet 
the principal balance sheet 
movements over the last year  
were a reduction in net debt and  
a movement from our pension  
defecit to surplus on an ias19 basis 
the prior year deficit of £177m  
net of deferred tax moved to a 
surplus of £12m due to improvement 
in the asset values and deficit  
funding payments
the 2012 triennial valuation process 
remains ongoing at this time  
we continue a constructive dialogue 
with the defined benefit schemes’ 
trustees and the pension regulator  
to finalise the funding deficit and 
future contribution plan which is 
prepared under a different set of 
assumptions in particular in relation 
to the discount rate which will leave  
a deficit on this basis of calculation 
the £47m deficit funding payment 
due under the existing recovery plan 
for 2014 was paid in january 
cash flow and net debt 
net debt fell by 21 to £357m 2012 
£453m and has now reduced by over 
a third in the last two years this was 
due to the strong cash generation of 
the core business with 94 of operating 
profit converted to free cash flow 
2012 120 pension deficit funding 
£42m interest payments £31m 
and capital expenditure £14m  
were the principal outflows 
net debt at the 2013 year end 
represented 18x ebidta down  
from 23x in 2012 and 32x in 2011 
and is on track to meet the group’s 
15x ebidta target level in 2014 
dividends 
the board has declared a final 
dividend for 2013 of 20 pence per 
share which subject to approval by 
shareholders at the agm in april will 
be paid in may 2014 a progressive 
dividend policy has been announced 
and the expected level of total 2014 
dividends is 30 pence per share 
principal activities 
the principal activities of the group 
are the production and broadcasting 
of television programmes internet 
services and the scale of advertising 
airtime and space in these media  
the group continues to focus on its 
television and digital media business 
compliance 
part of the information that fulfils the 
companies act requirements of the 
directors’ report can be found in the 
performance review on pages 24 to 
28 the group’s principal operating 
subsidiaries are listed in note 2 of the 
company financial statements and 
details of the principal risks and 
uncertainties facing the group can be 
found on pages 29 and 30
independent auditors and 
disclosure of information 
so far as the directors are aware 
there is no relevant audit information 
that is information needed by the 
group’s auditors in connection with 
preparing their report of which the 
group’s auditors are not aware each 
director has taken all steps that he or 
she ought to have taken as a director 
in order to make him or herself aware 
of any relevant audit information and 
to establish that the group’s auditor  
is aware of that information 
going concern 
the group continues to review 
forecasts to determine the impact  
of both the shortterm and longterm 
liquidity position after making 
appropriate enquiries and taking into 
account the extension of the banking 
facility in february 2014 the directors 
have a reasonable expectation that 
the group has adequate resources  
to continue in operation for the 
foreseeable future 
shares and other interests 
as at 12 march 2014 the group had been notified of the following interests  
of 3 or more in its ordinary shares 
shareholder total shares 
odey asset mgt 6549764 1677
ubs global asset mgt 3904592 999
blackrock inv mgt 2773335 710
threadneedle asset mgt 2404031 616
cavendish asset mgt 1913117 491
river  mercantile asset mgt 1882551 482
scottish widows inv p’ship 1639544 420
crystal amber asset mgt 1374500 352
jp morgan asset mgt 1305155 334
debt reduction
2012 £453m
2013 £357m
21
2012 £102m
2013 £135m
32
production revenue growth directors’ report – strategic report
26  p e r f o r m an ce r e v i e w 
continued
accordingly the group continues to 
adopt the going concern basis in 
preparing its consolidated financial 
statements 
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 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 
and
•  prepare the financial statements  
on the going concern basis unless 
it is inappropriate to presume that 
the group will continue in business
the directors consider that the  
annual report and accounts for the 
year ending 31 december 2013  
when taken as a whole is fair 
balanced and understandable and 
provides the information necessary 
for shareholders to assess the 
company’s performance business 
model and strategy
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 38 
confirm that to the best of his or her 
knowledge and belief
•  the group financial statements 
which have been prepared in 
accordance with ifrss as adopted 
by the eu give a true and fair view 
of the assets liabilities financial 
position and profit of the group 
and
•  the directors’ report includes a  
fair review of the development and 
performance of the business and 
the position of the 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 
group’s website and legislation in  
the united kingdom governing the 
preparation and dissemination of 
financial statements may differ from 
legislation in other jurisdictions 27
stv annual report  accounts 2013
performance review – kpis 20112013
the kpis have provided 
focus and a transparent 
measure of progress  
during 2013
why it’s important
our programme strategy results in more scottish based  
content appearing on our 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 the itv network
peak time audience v itv network
consumer
objective is to exceed  
the network performance
2011 actual 085pts
2012 actual 130pts
2013 actual 150pts
why it’s important
margin improvement across the period provides 
evidence of profitable growth
how we measure it
it is calculated as underlying operating profit divided  
by turnover and expressed as a percentage
increase consumer margin
2011 actual
2012 actual
2013 target
2013 actual
155
183
160
178
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 
monthly page impressions 
q4 monthly average
2011 actual 170m
2012 actual 204m
2013 target 220m
2013 actual 270m
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 
monthly unique users
q4 monthly average
2011 actual 30m
2012 actual 32m
2013 target 35m
2013 actual 31m
why it’s important
understanding the tastes and preferences of our 
consumers and audiences is key to developing 
successful consumer services
how we measure it
using a platform with our data partner experian  
we capture key consumer data
consumer insights
2011 actual
2012 actual
2013 target
2013 actual
03m
05m
12m
06m directors’ report – strategic report
28  performance review – kpis 20112013 
continued
production
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 
digital margin
why it’s important
margin improvement across the period provides  
evidence of profitable growth 
how we measure it
it is calculated as underlying operating profit divided  
by turnover and expressed as a percentage 
production margin
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
doubling of production revenues is a key strategic aim 
and this measure tracks evidence of this growth being 
delivered
how we measure it
it is the value of revenues generated from external 
commissions and secondary sales
production revenues
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 
monthly video streams 
q4 monthly average
why it’s important
a key strategic objective is to grow our productions  
business and this provides clear evidence of that growth 
how we measure it
it is the total of all hours of new external production 
delivered in the financial year to third party broadcasters
production hours
objective is to exceed  
10 in all years
2011 actual 17
2012 actual 26
2013 target 25
2013 actual 40
2011 actual £71m
2012 actual £65m
2013 target £113m
2013 actual £75m
2011 actual £84m
2012 actual £102m
2013 target £150m
2013 actual £135m
2011 actual 6
2012 actual 2
2013 actual 3
2011 actual 29m
2012 actual 31m
2013 target 38m
2013 actual 23m
2011 actual 121
2012 actual 141
2013 target 150
2013 actual 157 29
stv annual report  accounts 2013
directors’ report – strategic report
principal risks
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 and 
there are rigorous internal 
systems to identify monitor and 
manage any risks to the business 
following an indepth review of the risk 
register last year which was facilitated 
by deloitte the internal auditor the 
register has been developed in a way 
which now allows the key risks facing 
stv to be summarised and actions 
taken to improve control able to be 
tracked and changes to the risk 
portfolio monitored
the risk register sets out the key  
risks that we have identified 
allocating an owner to each together 
with the risk impact likelihood and 
score both on a gross and after the 
current mitigating controls have been 
taken into account a net basis  
the effectiveness of the current 
mitigating controls is graded as 
strong adequate or weak and any 
additional controls required are also 
noted the register is reviewed and 
updated on an ongoing basis both  
at an operational level and on a 
quarterly basis by the board with  
the audit committee conducting  
an annual review 
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 which are regulated  
by ofcom and on 11 february 2014 
both licences were renewed for a 
further 10 year term through to 2024 
these channel 3 licences contain 
conditions around contribution to 
public service broadcasting 
programme production and 
compliance with ofcom’s codes  
as licensees it is stv’s responsibility 
to ensure that the terms of these 
licences are adhered to and 
measures have been put in place 
internally to ensure that this occurs  
in the event of any serious or 
repeated breaches ofcom has 
powers to impose sanctions on 
licensees including in the most 
extreme circumstances financial 
penalties or revocation of licences
in august 2012 scotland’s first 
minister confirmed that should 
scotland become an independent 
country stv’s broadcasting licences 
would be honoured for their full 
duration through until december 
2024 in addition the scottish culture 
cabinet confirmed in november 2013 
that the local tv licences covering 
glasgow and edinburgh would also 
be honoured for their full duration
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 
stv’s control these factors include 
general economic conditions 
conditions specific to general 
advertising markets including the 
commercial television market 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 stv 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
a significant amount of stv’s 
programming content is provided  
by the itv network therefore 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 
performance this relationship is 
managed closely with regular 
updates on programme and schedule 
developments being provided and 
through stv’s commercial director 
who manages the sales relationship 
with itv
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 the 
group’s leverage and other debt 
arrangements an increase in libor 
interest rates could have an adverse 
impact on the financial position and 
business results stv is exposed to  
a variety of financial risks that arise 
from and apply to its activities 
currency risk credit risk liquidity risk 
and cash flow interest rate risk the 
group’s borrowings are denominated 
in sterling which is also the group’s 
intrauk net currency flow the group’s 
overall risk management programme 
focuses on the unpredictability  
of financial markets and seeks to 
minimise potential adverse effects  
on financial performance directors’ report – strategic report
30  p r i n c i pa l r i sk s 
continued
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 
currency risk the group’s borrowings 
are denominated in sterling which is 
also the group’s intrauk net currency 
flow currency risk arises primarily 
with respect to the euro and us  
dollar and 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 high
creditquality 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 and its income and 
operating cash flows are substantially 
independent of changes in market 
interest rates 31
stv annual report  accounts 2013
directors’ report – strategic report
corporate responsibility
‘ … using our unparalleled convening power  
to raise awareness of child poverty and  
make a positive difference …’
rob woodward
chief executive
as a company with deep 
connections with consumers 
communities and a strong public 
service content ethos we 
recognise the need to give 
something back and make a 
positive difference
stv appeal 2013
the appeal was set up in 2011 by 
stv and the hunter foundation and 
is committed to being a force for 
good in the fight against child poverty 
in scotland in its third year the stv 
appeal raised an incredible £25m  
for children and young people in 
scotland affected by poverty 
in 2013 the wood family trust 
committed £150000 funding for three 
years to support projects in the north 
east and sir ian wood joined the 
board of the charity stv’s chairman 
baroness margaret ford was 
appointed as chair of the stv appeal 
taking over from richard findlay 
all overheads are met by stv and 
the hunter foundation so every 
penny donated to the appeal stays  
in scotland and goes directly to the 
children that need it most each year 
the stv appeal supports projects  
in every local authority in scotland 
we believe this is an approach that 
resonates with our consumers and 
has helped to establish the appeal  
as a major scottish charity
for the third consecutive year the fund 
raising efforts were supported by match 
funding from the scottish government 
for the first £1 million raised 
the appeal continues to work closely 
with six charities each of which are 
recognised as experts in the area of 
child poverty and smaller community 
based projects the stv appeal 
endeavours to work beyond reactive 
grantmaking to identify and target 
key areas of unmet need investment 
is made in innovative and effective 
projects that will make a sustainable 
difference to scotland’s most 
disadvantaged children and young 
people and support longterm  
social change 
the money raised by the stv appeal 
helps make a real difference in the 
lives of scotland’s children and young 
people by providing food and warm 
clothes creating opportunities for 
training and employability and 
enabling practical social and 
emotional support for those who need 
it most over the last three years 172 
big and small grants have been made 
to projects across all 32 local authority 
areas in scotland providing much 
needed support to 27000 children
the grants made from 2013 
fundraising have already been 
invested in a variety of projects with 
the ambition of supporting long term 
change in the area of child poverty 
28 of funds were distributed to 
projects that build stronger 
communities and 25 of projects 
support employability 
the appeal raises funds across the 
country and is supported by individual 
donations from stv viewers and 
fundraising from corporate partners 
scotland’s leading scottish 
businesses including tunnock’s and 
optical express got involved in the 
2013 appeal and once again stv 
employees including the senior 
management team took part in 
volunteering and fundraising 
in 2013 the appeal became the 
official charity partner of the freshnlo 
pedal for scotland glasgow to 
edinburgh cycle the event raised 
over £100000 and provided a great 
opportunity for supporters and stv 
employees to get involved and raise 
money for the cause
the freshnlo pedal for scotland event 
featured as part of the dedicated stv 
appeal programming in 2013 a 
series of engaging entertaining 
hardhitting and celebrity packed 
programmes were screened in 
october to encourage donations and 
engage scots in the appeal which 
once again culminated in a live show 
hosted by lorraine kelly 
stv’s appeal programming 
celebrated the fantastic fundraising 
efforts of the year this included mark 
beaumont’s highland line challenge 
which saw him run and swim the 
breadth of scotland in 10 days a 
grueling 230 mile journey from arran 
to aberdeen stv’s sean batty took 
on a northern isles cycling challenge 
and john michie was joined by carole 
smillie and bruce devlin for a 12hour 
dance marathon directors’ report – strategic report
32  cor p or a t e r e s p o n s i b i l i t y 
continued
the appeal received great support 
from many stv employees a number 
of teams within the company 
championed fundraising activities and 
raised awareness both across the 
business and outwith stv staff have 
also taken the time to visit the 
projects that are benefiting from the 
money raised by the stv appeal and 
meet with the project workers and 
community members 
stv is in a privileged position using 
our unparalleled convening power to 
raise awareness of child poverty and 
make a positive difference and this 
commitment will continue in the  
year ahead
our people
the stv way
core to the success of stv is the 
creativity and commercial focus of our 
people over the past year investment 
has been made in a programme of 
activities to redefine the culture of  
the organisation
in early 2013 the stv way  
the company’s employee value 
framework was introduced the stv 
way encourages everyone in the 
business to be bold to stand 
together and to strive to surprise in 
pursuing their individual and collective 
goals and in responding to future 
challenges and opportunities
achieving sustainable growth through 
developing innovative services 
creating engaging content and 
strengthening consumer relationships 
is founded upon the capabilities 
creativity and innovativeness of 
everyone in the business employee 
engagement levels have continued to 
increase as an increasing number of 
staff have participated in the activities 
implemented during 2013 to embed 
the stv way
equipped to deliver growth
investment in new talent across all 
areas of the business has continued 
during 2013 there has been a 
particular focus on strengthening and 
expanding the product development 
team to support the ambitious 
development roadmap underpinning 
the continued growth in digital 
activities the product development 
philosophy is based upon ensuring 
stv’s content and services are 
available anywhere and anytime to 
reflect changes in media consumption 
patterns 
during the year the product 
development team has been coached 
and trained in agile principles as the 
underlying approach to achieve the 
company’s ambitious programme of 
technology innovation and to 
incorporate a rapid response team to 
improve product and platform 
reliability and provide a leading 
consumer service
 
the growth of stv productions has 
also created opportunities to attract 
new creative talent to the business as 
the team has become established 
across all genres we have continued 
to support the development of new 
talent to the industry at entry level and 
work closely with skillset scotland to 
identify opportunities to coordinate 
on the job experience with formal 
development
in the core areas of the business 
investment has been made in skills 
acquisition and development as the 
digital publishing team has been 
refocused to respond to the launch 
of the new digital city services 
in response to investment in new 
technology which has transformed 
the workflows across the news and 
current affairs team an extensive 
skills development programme has 
been completed by the news team 
during the second half of 2013
in late 2013 a campaign to recruit the 
production and technical teams to 
deliver the new city tv service which 
will launch during 2014 commenced 
a key criterion in the selection 
process is to recruit a team who will 
embody the mindset of the next 
generation of television and media 
services the campaign conducted 
solely through social media elicited a 
high response with the majority of 
vacancies filled by january 2014 
induction and training of the new 
recruits commences in march
 
clarity of purpose
the focus on kpis continues to be the 
main operational driver across the 
business this provides all staff with  
a clear vision of the strategic aims of 
the company the key performance 
indicators and measures against 
which the company’s success will be 
evaluated and through this individual 
performance goals and targets are 
assigned providing a reference for 
every employee of the impact of their 
contribution to the company’s 
progress and results
 
our culture is based on the belief that 
everyone can make a difference and 
should strive for continuous 
improvement to surprise and delight 
our audiences and consumers 
monthly staff briefing sessions are 
held by members of the leadership 
team as we continue to increase the 
range of opportunities for staff to have 
their say on all aspects of business 
strategy and performance the chief 
executive officer conducts regular 
allstaff sessions to provide updates 
on business performance strategy 
and developments affecting the 
business and to obtain feedback and 
suggestions on the development  
and growth of the business 33
stv annual report  accounts 2013
our senior leadership management 
forum comprising the staff 
responsible for key growth and 
revenue targets meets on a monthly 
basis to encourage collaborative 
working and facilitate the acquisition 
of knowledge of future trends 
impacting the sector
the relationship with trade unions 
recognised by the company for 
collective bargaining purposes is 
based on a partnership approach 
with open dialogue and regular 
consultation to ensure a shared 
understanding of the company’s aims 
and the contribution expected from 
our people in delivering these
 
learning and development
ensuring our staff have the capability 
skills and confidence to deliver the 
goals and targets of the business is 
achieved through our employee 
development framework stv 
learning this is linked to the 
development goal setting undertaken 
through our employee performance 
and development process 
through stv learning we provide 
development opportunities and 
learning sessions linked to key 
business priorities and future skills 
requirements 
we maintain strong relationships with 
colleges and universities to support 
the development of future talent to the 
industry and work to develop 
relationships with educational 
institutions across scotland 
as we prepare for the launch of the 
new city tv services we have 
established formal strategic 
partnership agreements with two 
leading universities in each of the 
cities in which the new services will 
be delivered glasgow caledonian 
university and napier university in 
edinburgh through these 
partnerships students will be able to 
develop skills in a live broadcast and 
production environment and they will 
be provided opportunities to 
showcase content they develop
during 2013 we have provided 
employment opportunities for over 
700 freelance production staff and 
talent as stv productions continues 
to secure recommissions of long 
running commissions this is 
contributing to more stable 
employment opportunities for 
freelance staff working in television 
production in scotland deepening the 
talent pool and making a positive impact 
to the creative economy of scotland 
we provide work placements across 
all areas of the business for pupils  
in secondary education and further 
and higher education to funded 
internships and work placements of 
up to twelve months’ duration during 
2013 we provided 70 placements
the company has continued to 
support the government’s ‘get ready 
for work’ programme providing 
mentored training programmes for 
young people not in education 
employment or training
reward and recognition
all aspects of reward and benefits  
are benchmarked against an 
independent crossindustry group  
of uk media companies to ensure 
that the employee benefits structure  
is effective in attracting and retaining 
the best talent 
the company’s reward strategy was 
reviewed during 2013 and a salary 
award was implemented with the 
specific aim of achieving more rapid 
salary progression for staff on lower 
salary ranges relative to the market 
position for their role this approach 
was deemed necessary to deal with 
the impact of salary restraint over 
recent consecutive years which was 
applied in response to the market 
downturn as a result an average 
salary increase of 31 was awarded 
to staff
 
equal opportunities and diversity
the company is committed to a 
culture where everyone is treated with 
dignity and respect and has the 
opportunity to deliver their full 
potential policies to ensure that the 
company engages effectively with 
audiences and attracts a diverse pool 
of creative talent are monitored on an 
ongoing basis the aim of the policies 
is to ensure that all employees and 
potential employees are treated in a 
fair and equitable manner regardless 
of their age disability marital status 
family responsibility race colour 
ethnic background nationality 
religion or belief gender gender 
identity or sexual orientation 
a diverse workforce enables stv  
to respond better to and reflect our 
audiences in all their diversity and  
it is important that a working 
environment is created which enables 
our employees to thrive and achieve 
their full potential 
a number of registered disabled 
persons are employed all of whom 
have had equivalent access to training 
and career development opportunities 
as their ablebodied colleagues no 
employees became disabled during 
the course of their employment in 2013
stv is fully committed to fostering 
talent and supporting people from all 
backgrounds who wish to progress 
however appointments and 
promotions are and will continue to 
be made based on merit and in line 
with the skills and attributes identified 
for each post including those 
identified by the nomination 
committee for the board stv is 
committed to appointing the best 
available person to any role within the 
company regardless of gender directors’ report – strategic report
34  cor p or a t e r e s p o n s i b i l i t y 
continued
the overarching aim in making any 
new appointments to the board must 
always be to select the best 
candidate to enhance functionality 
and to improve decision making as 
the primary focus is the strength of 
the board all appointments will 
continue to be based on merit 
measured against objective criteria 
and the skills and experience the 
individual offers
achieving the right mix of talent  
skills and experience on the board  
is critical for business and stv’s aim 
is to have an appropriate level of 
diversity in the boardroom to support 
the achievement of its strategic 
objectives diversity of perspective  
is vital and having directors from 
different backgrounds and with 
different skill sets ensures that 
decisions are challenged in a credible 
manner and ‘group think’ is avoided 
each person is different and diversity 
is about recognising respecting and 
valuing these differences
stv has chosen not to target a 
specific number or percentage of 
women for its board but to 
concentrate its efforts on encouraging 
more women to remain within the 
company and progress through the 
ranks to senior positions three of the 
10 members of the leadership team 
are female as is stv’s company 
secretary and as at 31 december 
2013 49 of stv’s staff were female 
up 1 from last year
debating matters 
in 2013 we launched a competition 
for secondary school pupils across 
scotland to debate the big issues in 
the run up to the referendum on 
scottish independence in 2014
stv teamed up with debating 
matters to give secondary school 
pupils from all 32 local authority areas 
the opportunity to research and 
discuss issues which will affect the 
future of scotland many of the 
secondary five and six pupils who 
take part will be eligible to vote in the 
referendum in 2014
the scotland wide competition 
referendum schools debate is open 
to secondary five and six pupils they 
were given the chance to compete 
with other schools in their local 
authority area in preliminary rounds 
throughout the summer the winners 
of the preliminary rounds went on to 
regional heats followed by the semi 
finals held in aberdeen the final will 
be held at stv’s glasgow studios in 
spring 2014
health and safety
stv is committed to compliance with 
all workplace health and safety laws 
and regulations to provide a safe and 
healthy working environment employee 
health and accidents are monitored 
closely and health promotion 
programmes designed to reduce health 
risk and enhance employee wellbeing 
are regularly undertaken a proactive 
approach to improve the company’s 
management documentation 
systems to provide suitable and 
sufficient information instruction 
training and supervision is in place
first aid training refreshers are carried 
out on a continual basis and we have 
a full complement of 41 first aiders 
located throughout stv sites
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 
driving standards and rules are 
communicated to staff through stv’s 
drivers manual and this helps 
maintain the company’s low accident 
rates 
we have continued our programme of 
defensive driving training training 
has been targeted at employees who 
drive for work on a regular basis and 
a further four drivers based at stv 
edinburgh have completed the 
course the training instructs drivers 
on methods of fuel efficient defensive 
driving as part of the training the 
driving standards of our drivers are 
assessed to identify any risks to stv 
so far no areas of concern have been 
identified and we have received very 
good positive feedback from those 
who have attended the course 
we have continued to place our news 
and creative teams on safety training 
with a chartered health and safety 
consultant who specialises in media 
safety training four members of our 
news team completed news 
2012 2013
 change m f m f
directors 8750 1250 75 25 up 100
leadership team 70 30 70 30 none
employees 52 48 51 49 up 1 35
stv annual report  accounts 2013
the stv appeal
the stv appeal has been 
established as a force for good  
in the fight against child poverty  
in scotland 
in the three years since launch  
the stv appeal has raised over 
£57 million which has allowed  
us to make 172 big and small grants 
to projects across all 32 local 
authority areas 
the money raised by the stv 
appeal helps make a real difference 
in the lives of scotland’s children 
and young people by providing 
practical help like food and warm 
clothes creating opportunities  
for training and employability and 
enabling social and emotional 
support for those who need it most
£25m raised  
in 2013
image stv appeal trustee lorraine kelly 
presents fundraising show the big live directors’ report – strategic report
36  cor p or a t e r e s p o n s i b i l i t y 
continued
assignment and locations safety 
training and 14 of our creative team 
have completed managing safety  
in film and television production  
this was provided by a chartered 
health and safety consultant who 
specialises in media safety training
2013 2012 2011
total accidents 29 29 28
number 
attributable  
to driver error 
24 12 18
percentage 
attributable to 
driver error
83 41 64
health and safety performance  
in 2012
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 facilities manager is the designated 
senior manager responsible for health 
and safety matters 
riddor threeday reportable 
accidents
2013 2012 2011
riddor 
threeday 
reportable 
accidents
0 3 0
total of all 
accidents
5 11 4
donations
the company’s policy is not to  
make donations which are of a 
political nature
our environment
stv recognises that its daytoday 
activities can and do have an effect 
on the environment the company’s 
environmental policy is aimed at 
reducing impacts on the environment 
and is part of the culture of the 
business the company is committed 
to the continuous improvement of its 
environmental performance and the 
reduction of pollution and is a 
member of the prince’s may day 
network a collaboration of 
businesses addressing climate 
change which was founded by hrh 
the prince of wales
the average monthly recycling in 2012 
was 92 during 2013 our waste 
management company changed its 
recycling structure and can now 
recycle 100 of our waste via refuse 
derived fuel rdf so no waste is 
going to landfill
stv has a green travel plan at the 
glasgow headquarters to encourage 
staff to use more sustainable means 
of transport to commute to promote 
cycling shower facilities cycle 
parking and lockers are provided for 
employees a car sharing initiative 
matching up employees living in the 
same area enabling them to travel to 
work together is managed there are 
currently 31 members of staff taking 
part in this initiative stv also took 
part in the walk at work initiative for 
the third consecutive year
as the scottish government has 
launched its zero waste plan – aiming 
to increase scotland’s recycling to 
70 by 2025 – the company has a 
goal to improve yearonyear to 
achieve this target and increase 
recycling figures
stv is working towards retaining  
its ‘gold’ award from the national 
recycling stars environment media 
group in recognition of our recycling 
efforts and will do all we can to  
retain this
the number of recycle bins 
throughout the offices mainly with the 
introduction of food waste recycling 
has increased this was only 
introduced in june 2012 but has 
continued to be a successful initiative 
with staff 37
stv annual report  accounts 2013
reporting greenhouse gas emissions
scope 1 emissions from activities and sources we own and control eg cars
scope 2 emissions associated with our consumption of purchased electricity 
heat steam and cooling heating offices etc
 scope 1 emissions increased during 2013 as a result of the relocation of some sales  
creative and production staff to the london office thus necessitating more travel between 
london and glasgow
boundary summary
stv reports utility usage on five of its 
six sites as an overall service charge 
is paid for the inverness site a 
breakdown of electricity and gas 
usage is not provided by the landlord 
the waste and recycling is reported 
only for pacific quay which is by far 
the biggest site we have been unable 
to establish weights and tonnage of 
waste uplifted for other sites but will 
endeavour to do this in the future
ghg emissions statement
stv has reported on all of the 
emission sources required under  
the companies act 2006 strategic 
report and directors’ reports 
regulations 2013
these regulations require us to state 
the annual emissions in tonnes of 
carbon dioxide
i  from activities for which we are 
responsible including the 
combustion of fuel and the 
operation of our facilities and 
ii  resulting from the purchase of 
electricity heat steam or cooling 
by us for our own use 
there is no prescribed methodology 
under the regulations but the 
independent standard we have 
chosen to use in order to ensure 
effective emissions management and 
transparency in reporting is the uk 
government’s environmental 
reporting guidance 2013 version 
stv must also express our emissions 
by way of an intensity ratio to allow 
the comparison of our performance 
over time and also with other similar 
types of organisations
ghg emissions are to be reported as 
a gross figure in tonnes of co 2e and 
the intensity ration we have chosen is 
co 2e per million pounds of revenue
assessment parameters
boundary summary see below
materiality threshold materiality was set at 5
intensity ratio emissions per £m of revenue
fy2013 fy2012
greenhouse gas  
emission source tco
2
e
tco
2
e£m 
revenue tco
2
e 
tco
2
e£m 
revenue
scope 1 44226 394 41362 403
scope 2 192424 1717 207217 2017
statutory total scope 1  2 236650 2111 248579 2420
rob woodward
chief executive directors’ report – corporate governance
38 board of directors
margaret ford 56 
chairman
3
appointed to the board in june 2013 
margaret ford has over 20 years 
experience as a nonexecutive director 
and chairman of private and listed 
companies and extensive experience 
of working with government she is 
currently chairman of barchester 
healthcare limited the private 
healthcare provider and is a non
executive director of taylor wimpey plc 
segro plc and grainger plc from 2009 
to 2012 she was a member of the 
olympic board and chairman of the 
olympic park legacy company she 
was appointed to the house of lords in 
2006 and sits as an independent peer
rob woodward 54
chief executive
appointed to the board in february 
2007 previously rob was commercial 
director of channel 4 television 
corporation and on the main board  
he 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 
telecoms media and technology 
business and uk strategy consulting 
practice rob is a trustee of the stv 
appeal charity he was appointed 
prochancellor and chair of the 
council of city university london in 
february 2012 is a trustee of nesta 
and a nonexecutive director of 
regenersis plc
george watt 46
chief financial officer
appointed to the board in february 2001 
as group finance director george is  
a member of the institute of chartered 
accountants in scotland he joined the 
company in 1998 as group financial 
controller and treasurer and prior to this 
worked with kpmg’s audit and assurance 
services practice in the uk and also  
in the us george is a nonexecutive 
director of mirriad limited a leading 
digital product placement company  
and gamesanalytics ltd a datamining  
and analytics company george is also 
an executive committee member of the 
scottish council for development and 
industry a member of the cbi scotland 
council and a trustee of the stv appeal
david shearer 54
senior independent director 
13
appointed to the board in february 
2007 david is an experienced corporate 
financier and turnaround specialist and 
was previously senior partner of deloitte 
llp for scotland  northern ireland 
and a uk executive board member of 
deloitte llp he recently stood down 
as chairman of mouchel group having 
led its restructuring is chairman of 
aberdeen new dawn investment trust 
plc cochairman of martin currie 
holdings limited and a nonexecutive 
director of mithras investment trust plc 
he was previously chairman of crest 
nicholson plc and a nonexecutive 
director of city inn limited where he 
stood down after successfully 
completing the financial restructuring of 
these businesses was a nonexecutive 
director of renold plc superglass 
holdings plc scottish financial 
enterprise and a governor of the 
glasgow school of art
vasa babic 47
nonexecutive director 
12
appointed to the board in february 
2007 vasa works as an independent 
advisor to large european companies 
previously he was a partner of hanover 
investors 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 
telecoms internet media and 
technology industries he has an ma  
in economics from king’s college 
cambridge
jamie matheson 59
nonexecutive director 
12
appointed to the board in march 2007 
jamie’s career spans some 40 years 
principally in the financial sector he was 
for eight years until his retiral in march 
2013 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 a nonexecutive 
director of maven income and growth 
vct5 plc from 2001 to 2013 he is a 
director of scottish financial enterprise 
and has a number of charitable interests 
including being a director of the hms 
victory preservation company jamie 
has recently been appointed chairman 
of the beatson cancer charity
michael jackson 56
nonexecutive director 
2
appointed to the board in 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 
television group in charge of the 
creative and strategic direction of the 
television business he served four 
years as chief executive officer of 
channel 4 television 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 bbc one and director of television and 
as controller of bbc two he was 
previously a nonexecutive director of 
emi group plc
genevieve shore 44
nonexecutive director 
23
genevieve shore joined the board on  
1 march 2012 genevieve’s career 
includes extensive digital technology 
and commercial experience in the media 
publishing and technology sectors with  
a particular focus on development of 
consumer products and services 
genevieve currently sits on the 
management board of pearson plc 
reporting to john fallon as chief product 
and marketing officer of pearson plc 
previously genevieve has held leadership 
roles with pearson group including 
global digital director penguin and 
group sales director penguin 
 
key
1 audit committee
2 remuneration committee
3 nomination committee 39
stv annual report  accounts 2013
left to right from top
margaret ford
rob woodward
george watt
david shearer
vasa babic
jamie matheson
michael jackson 
genevieve shore directors’ report – corporate governance
40 corporate governance report
principles statement
stv group plc is fully committed to the highest standards of corporate governance believing that such standards are 
vital to overall business integrity and performance and considers it crucial that it conducts itself honestly transparently 
and responsibly
the board has a critical role to play in shaping business performance while creating and delivering long term return  
for shareholders this requires it to determine business strategy and the company’s appetite for risk to monitor 
management’s performance in delivering against that strategy and ensure that the risk management measures and 
internal controls put in place are appropriate and effective the board must ensure that the funding and talent available 
to the business will support it in the longer term and must remain aware of the company’s obligations to its shareholders 
and other stakeholders responding to their needs with transparent reporting and active engagement
statement of compliance
the board considers that in respect to the financial year ended 31 december 2013 the company has complied  
fully with the uk corporate governance code 2012 ‘the code’ and this section together with the report by the 
directors on remuneration set out on pages 46 to 54 describes in greater detail how the principles and provisions  
of the code have been complied with the code is published by the financial reporting council from whom paper  
and downloadable versions can be obtained via its website wwwfrcorguk
board of directors
the membership of the board throughout the year and up to the date of signing the financial statements was as follows
chairman   baroness margaret ford  
appointed nonexecutive director 1 june 2013  
appointed chairman 31 august 2013 
richard findlay retired 31 august 2013
chief executive officer rob woodward
chief financial officer george watt
nonexecutive directors
david shearer senior independent director
vasa babic
jamie matheson
michael jackson
genevieve shore
the powers of the directors including in relation to the issue or buy back of shares are exercisable in accordance  
with the companies act and the company’s articles of association any amendments to the company’s articles  
of association require a special resolution in accordance with the companies act 2006
‘ good corporate governance enhances and underpins  
a company’s longterm sustainable performance it is critical  
 to longterm value creation and economic growth’ 
 
financial reporting council 41
stv annual report  accounts 2013
board appointment balance and independence
the board has considered the independence of the nonexecutive directors and and regards all of the current directors 
to be of independent character and judgement upon her appointment as chairman baroness margaret ford met  
and continues to meet the independence criteria set out in the code however vasa babic would not be considered 
independent in the strict terms of the code since he was formerly an advisor to and a partner of hanover investors 
which was a shareholder in stv up until 2011 
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 decisionmaking 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 sectors means they can constructively challenge management in relation both  
to the development of strategy and performance against the goals set by the board 
the nonexecutive directors do not participate in any share option or pension scheme of the company
directors 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 during the year to 31 december 2013
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 or she incurs in defending any proceedings brought 
against them provided that judgement is not given against them all directors have access to the advice and services  
of the company secretary and at the company’s expense the company’s legal advisors the company secretary is  
an employee of the company and attends all meetings of the board and its committees she is responsible for making 
sure that all board procedures are observed and for advising the board on corporate governance matters she also has 
responsibility for ensuring the flow of information within the board its committees and between senior management and 
nonexecutive directors
board responsibilities
there is a wellestablished division of authority and responsibility within the company through the separation of the roles of 
chairman and 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 that directors receive accurate timely and clear information as well 
as setting the agenda she provides a conduit for communication to and from shareholders and facilitates the contribution of 
the nonexecutive directors while ensuring constructive relations between the executive and nonexecutive directors
the board has responsibility for making all key strategic management and commercial decisions which are necessary for 
the conduct of the company’s business as a whole including the approval of corporate strategy annual budgets interim 
and full year financial statements and reports dividends accounting policies and all significant capital projects acquisitions 
and disposals the chief executive and his management team are responsible for developing the appropriate business 
strategy and once approved by the board for ensuring that the strategy is effectively implemented in accordance with 
the approved operating plan and within a sound system of internal controls to achieve the agreed objectives he creates 
a framework of strategy values organisation and objectives to ensure the successful delivery of results and allocates 
decision making and responsibilities accordingly compliance with policies and achievement against objectives is 
monitored by the board through monthly and quarterly performance reporting and budget updates directors’ report – corporate governance
42  corporate governance report 
continued
it is the duty of all directors to promote the success of the company for the benefit of its members as a whole  
and in doing so to have regard amongst other matters to the
• likely long termconsequences of any decision
• interests of the company’s employees
• need to foster the company’s business relationships
• impact of the company’s operations on the community and the environment
• desirability of maintaining a reputation for high standards of business conduct and
• need to act fairly as between members of the company 
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 conduit between the chairman and the nonexecutive directors and is responsible for leading the 
nonexecutives discussion on the chairman’s performance at the annual performance review
the board 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
board meetings 
attendance of board members at board and committee meetings held in 2013 is set out below
 
 
board
audit  
committee
remuneration 
committee
nomination 
committee
number of meetings held 9 4 2 4 
attendance  
richard findlay retired 31 august
5 1
margaret ford appointed 1 june 5  1  1 2
david shearer 9 4 4
rob woodward 9 4 2
george watt 9 4
vasa babic 9 4 2
jamie matheson 9 4 2
michael jackson 7 1
genevieve shore 7 4
attended at the invitation of the respective chairman
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 which can be found on the company’s website 
at wwwstvplctv under the investor centre 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 company’s longterm objectives and commercial strategy annual operating and capital expenditure budgets
• material contracts and significant variations in terms of the company’s borrowing facilities
• corporate activity which is subject to the city code on takeovers and mergers or of a material nature
• major changes to the company’s pension schemes share schemes and treasury policy and
• risk management internal control policies and corporate governance arrangements 43
stv annual report  accounts 2013
all directors attended the annual strategy day held during 2013 and consider that the session is an important tool  
in agreeing stv’s overall strategic direction and discussing goals and objectives 
when a director is unable to attend or dial in to a board or committee meeting he or she 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
board focus
the main areas of board focus during 2013 included 
  
operational and financial performance including monitoring
• receipt of operational and financial updates at each board meeting
•  review of monthly finance reports including details of performance against budget and the company’s  
financial position
• approval of the annual report its full and halfyear financial results and ims statements made
• approval of the 2014 budget
strategy
• presentations on initiatives to grow revenue
• approval of the company’s strategy
corporate development
• agreement of stv’s corporate objectives and values for 2013
• approval of investment in predictive analytics specialists gamesanalytics
• approval of further investment in digital product placement company mirriad
• launch of four new digital services with apps for glasgow edinburgh aberdeen and dundee
•  planning for the launch in 2014 of the two local tv licences covering glasgow and edinburgh which were awarded  
to stv in january 2013
governance and risk
•  review of reports on risk and the appropriateness of the financial statements being prepared on a going concern basis
• review and approval of the risk register
• through the audit committee approval of tender for the statutory audit
• approval of the internal audit plan for 20132014
• approval of the 2014 agm resolutions
•  approval of the appointment of baroness margaret ford firstly as a nonexecutive director and then as chairman 
replacing richard findlay after his retirement
• performance evaluation
• review and consideration of pensions deficit
investor relations
•  review of institutional feedback following meetings between the company’s broker and shareholders after both  
the full and half year results
•   review of the draft analysts’ results presentations when reviewing the company’s full and halfyear financial results
corporate social responsibility
• involvement in the stv appeal 2013 which raised over £25m for children living in poverty in scotland directors’ report – corporate governance
44  corporate governance report 
continued
board committees
the board is supported by the audit remuneration and nomination committees 
each of these committees held an evaluation of their work and effectiveness during the year the results of which  
were reported to the board by the respective committee chairman the reviews concluded that each committee  
was operating in an effective manner and carrying out its 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
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 54 to 78 the terms of reference of the remuneration committee are available on request and on 
the company’s website wwwstvplctv
leadership
board of directors
audit committee
•  monitors the integrity of the 
published financial statements
•  reviews the effectiveness of  
internal financial controls 
•  reviews the operation of the  
risk management process
•  discusses with the company’s 
auditors matters arising from  
their work
•  reviews the scope of work  
and reports produced by  
the internal auditors
•  monitors and reviews the 
effectiveness of the internal  
audit function and the external 
auditors
page 45
audit committee report
remuneration committee
•  determines and agrees with  
the board the framework for  
the remuneration policy
•  reviews the ongoing 
appropriateness and relevance  
of the remuneration policy
•  approves the design of targets  
for and payments from any 
performance related pay schemes
•  reviews the design of all share  
incentive plans 
•  determines the remuneration 
packages for executive directors 
and other senior executives
•  reviews and notes annually  
the remuneration trends across  
the company
page 54
remuneration committee report
nomination committee
•  reviews the structure size and 
composition of the board
•  reviews succession plans  
and makes recommendations  
to the board
•  identifies and nominates 
candidates  
for approval of the board 
•  recommends to the board 
membership of the board 
committees
page 45
nomination committee report
•  determines longterm direction and strategic aims
• sets framework of appropriate and robust controls
• ensures efficient and effective operation of the business
• engages with shareholders and stakeholders 45
stv annual report  accounts 2013
report from the nomination committee
the members of the committee during the year were
richard findlay chairman retired 31 august 2013 
baroness margaret ford appointed 20 august 2013 becoming chairman upon richard findlay’s retirement  
david shearer    
genevieve shore
the nomination committee has written terms of reference which are available on request and on the company’s website 
wwwstvplctv
early in 2013 the board agreed following a recommendation from the nomination committee that an additional  
nonexecutive director be sought to ensure progressive refreshing of the board and taking into account future needs 
that this person be capable of carrying out the role of chairman when that vacancy arose
given this point and that mr findlay had taken over the chairmanship of the nomination committee last year  
he had excluded himself from any discussions and meetings on this matter
a formal tender was thereafter carried out to select the best recruitment consultant to assist stv following which  
the services of isabel bird from bird  co group were engaged neither ms bird nor bird  co group have any other 
connection with stv
the process carried out by the committee was vigorous and robust firstly evaluating the balance of skills experience 
independence and knowledge currently on the board and in light of this creating a specification of the role sought including 
an assessment of the time commitment expected consideration was also given to the benefits of diversity on the board 
the committee reviewed the profiles of 19 candidates the majority of whom were subsequently approached and 
thereafter a shortlist was created each of whom met with mr shearer ms shore and mr woodward who agreed  
that all were strong in their own right and could execute the role competently
after discussion the committee agreed that baroness ford’s experience reputation and management style made  
her an excellent candidate and recommended her appointment to the board which was unanimously agreed  
baroness ford was appointed nonexecutive director on 1 june 2013 and became chairman on 31 august 2013 
following richard findlay’s retiral
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 the audit committee has written 
terms of reference which are available on request and on the company’s website wwwstvplctv
at the invitation of the committee meetings are attended by the chief executive officer chief financial officer  
and the company secretary as well as the group financial controller representatives from both the external and  
the internal auditors also attend each meeting and the committee meets separately with senior management and  
the external auditors directors’ report – corporate governance
46  corporate governance report 
continued
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
the audit committee and the board place great emphasis on the objectivity of the company’s auditors 
pricewaterhousecoopers llp ‘pwc’ in their reporting the audit partner and manager attend all 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 auditors are required each year to confirm in writing to the committee that they have complied with the 
independence rules of their profession and regulations governing independence having taken into consideration matters 
such as the individual independence of members of the engagement team and the firm as whole and the nature of  
any nonaudit work undertaken before pwc takes on any engagement for other services from the company careful 
consideration is given as to whether the project could conflict with its role as auditors or impair its independence  
this includes consideration of the safeguards which are in place to mitigate the risks to independence 
in general the auditors may not provide a service which 
a creates a mutuality of interest 
b places the auditors in a position to audit their own work 
c results in the auditors acting as a manager or employee of stv and
d puts the auditors in the role of advocate for stv 
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 
significant issues considered by the audit committee in relation to the 2013 financial statements included the following
deferred production stock
deferred production stock forms part of inventory and is stated in the accounts at the lower of cost and net realisable 
value programme costs are expensed in line with expected future revenues which are a judgemental area a detailed 
forecast of future sales is prepared by management based on historic experience and expected future trends the audit 
committee and pwc both concluded this was an appropriate basis of accounting
pensions
the assumptions adopted by stv had been updated from those used at 31 december 2012 and the appropriateness  
of the updated assumptions was considered by pwc
the discount rate salary increases rpi and cpi were all within a range that pwc considered appropriate and were 
consistent with assumptions being used by other companies although the assumptions in relation to mortality had 
historically been lower than were typically used by other companies stv’s figures were supported by an independent 
report obtained by management and therefore accepted by pwc
a new accounting standard ias19 revised had been adopted at the half year and management’s treatment and 
disclosures in relation to this new standard were considered to be appropriate 47
stv annual report  accounts 2013
independence of the external auditor
the audit committee is responsible for approving nonaudit work and in order to seek to preserve auditor’s objectivity  
and independence the company has a policy regulating the provision of nonaudit services by the auditors 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 auditors are the most suitable 
supplier of services a case by case decision is therefore necessary and the auditors cannot be engaged for nonaudit 
work without reference to the audit committee it is felt that this process ensures shareholders receive value for money 
and the audit committee keeps this policy under review pwc also has an internal process whereby preengagement 
approval of all nonaudit services is required to be given by the audit partner
during the year under review the nonaudit work carried out by pwc consisted mainly of advice in relation to tax 
developments and tax compliance as well as advice in relation to the value creation plan and bonus scheme  
given that much of the information was derived from the audited financial records the audit committee agreed that 
pwc was the most suitable supplier there will always be projects for which the external auditor is best placed to 
perform the work to the extent that its skills and experience along with its knowledge of the company makes it the most 
appropriate provider 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 
external auditor tender
pwc was appointed the company’s auditor in 2004 following a tender process and while the committee was satisfied 
with pwc’s effectiveness and independence it was felt appropriate to conduct an independent audit and tax services 
tender during 2013
the process carried out was thorough with five firms invited to tender each of whom submitted a proposal document 
met with various senior members of the finance team and thereafter discussed their respective documents with the 
chairman of the audit committee
 
while all proposals were of a high calibre with each firm having a strong team of people the audit committee selected 
three to deliver presentations after careful consideration of the proposals and presentations the committee 
recommended to the board that the incumbent pwc was best placed to fulfil the role of external auditor in reaching 
this conclusion the committee took into account the specific requirements of the group and pwc’s detailed knowledge 
of the business it was acknowledged that while the tender process had been successful it had also been beneficial  
in that it had widened management’s contacts with all five firms which had taken part 
there are no contractual obligations restricting the company’s choice of external auditor and a resolution to re appoint 
the auditors will be put before shareholders at the annual general meeting
external audit effectiveness
with regard to the requirement for the audit committee to assess the effectiveness of the external audit process the 
committee considers that this obligation has been fulfilled since a comprehensive review of the external audit function 
was carried out during the tender process in future stv will adopt a formal framework involving a questionnaire to  
be completed each year by each member of the audit committee and by the chief financial officer feedback will  
also be sought from stv’s finance team the comprehensive questionnaire will cover various aspects of the external 
audit process including the audit team how the audit is both planned and executed the role of management and 
communication once completed the feedback from the process will be considered by the audit committee and 
thereafter be provided both to the auditors and to management directors’ report – corporate governance
48  corporate governance report 
continued
internal audit
deloitte llp ‘deloitte’ was appointed as the company’s internal auditor in november 2009 and the primary focus  
of its comprehensive internal audit programme is to provide assurance over key revenue streams and operating  
costs deloitte review systems and processes and 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 provide update reports on which specific areas have been 
reviewed in terms of the planned internal audit for the year together with an 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
committee activities
the principal activities undertaken by the board committees during 2013 included
 month committee activity
january nomination succession planning
february audit review of year end results  
review of prelim announcement  
review of annual report  
review of independence of auditors  
review of external auditnonaudit fees  
approve internal audit plan for the year  
review of internal controlsrisk management
february remuneration approval of remuneration report
may nomination recommendation of appointment  
of baroness margaret ford
june audit recommendation of appointment of  
external audit and tax services advisor
august audit review of interim results  
internal audit update  
review of internal controlsrisk management
october audit in depth business risk review 
internal audit update 
performance evaluation
october nomination succession planning 
performance evaluation
december remuneration review of remuneration policy  
approval of executivedirector  
– bonuses  
– salary and bonus for 2014  
– bonus plan targets 
– performance evaluation
december nomination succession planning 49
stv annual report  accounts 2013
leadership team
the leadership team comprises the executive directors director of channels deputy director of channels  
director of content commercial director director of corporate development hr  communications director  
chief technology and platforms officer and the head of legal and regulatory affairs the purpose of the team  
is to drive the implementation of the company’s strategic priorities while 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 
diversity
stv takes the concept of diversity seriously and further details can be found on page 33
achieving the right mix of talent skills and experience on the board is critical for business and stv’s aim is to have  
an appropriate level of diversity in the boardroom to support the achievement of its strategic objectives diversity of 
perspective is vital and having directors from different backgrounds and with different skill sets ensures that decisions 
are challenged in a credible manner and ‘group think’ is avoided each person is different and diversity is about 
recognising respecting and valuing these differences
stv has chosen not to target a specific number or percentage of women for its board but to concentrate its efforts  
on encouraging more women to remain within the company and progress through the ranks to senior positions  
the number of female staff increased last year by 1 to 49
training and development
all directors are given a comprehensive introduction to the company’s 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 directors are also provided with 
and encouraged to take up opportunities to meet major shareholders 
development and training of directors is an ongoing process throughout their period in office the directors are regularly 
updated on the company’s business legal matters concerning their role and duties the competitive environments in 
which the company operates and any other significant changes affecting the company and the market sector of which 
it is a part in addition the board regularly receives presentations from senior managers within the company to ensure 
that directors’ knowledge skills and familiarity with the company’s businesses and people are updated and maintained 
in addition board training and development is considered as part of the annual performance evaluation exercise and 
during the year the chairman confirmed with each director that they were content with the level of training and 
development given with no director requesting additional training
performance evaluation
the effective functioning of the board is key to the success of the company and stv recognises that board evaluation  
is extremely valuable in contributing to board effectiveness a formal appraisal encourages all directors to reflect on what 
the board has accomplished as well as on what it should be doing how it operates and whether any improvements can 
be made
accordingly each year evaluation is undertaken in order to assess the board its committees the directors and the 
chairman the process aims to enhance effectiveness and also provides an opportunity for the nonexecutive directors 
– through their exposure on other company boards – to draw on their experience and to suggest areas of best practice 
as in previous years this is an internal exercise led by the chairman and the board considers this to be a sufficiently 
rigorous process directors’ report – corporate governance
50  corporate governance report 
continued
the evaluation is conducted using a detailed 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 only and a meeting of the nonexecutive directors led by the senior independent director 
without the chairman present the nonexecutive directors led by the senior independent director are responsible  
for evaluating the performance of the chairman taking into account the views of the executive directors however  
the chairman’s performance was not evaluated this year as she did not take up the role until 31 august 2013
on completion of the 2013 performance evaluation during which open and frank discussions were held the performance 
of each director was found to be effective and the mix of skills and experience on the board was felt to be appropriate 
measured against the principal duties expected of it and building upon the progress of previous years the board 
continued to operate effectively and to meet in full its obligations to support management to monitor performance 
across a wide area and to maintain its strategic oversight accordingly the process concluded that the board provides 
the effective leadership and control required for a listed company directors noted in particular the great chemistry that 
all were engaged in the success of stv and that there was a close working relationship with executives the board had 
dealt well with all issues which had arisen during 2013 and there had been a good process in place regarding the 
change of chairman
the high quality of the reports produced bythe executives being extremely thorough yet easily understood was 
particularly noted and with frequent contact with the leadership team all directors felt they had a good 360 view  
of stv
the evaluation process further concluded that the board was made up of strong and independent minded non
executive directors each of whom made a significant contribution to the overall success of the company and who 
demonstrated full commitment in their respective roles all were able to allocate sufficient time to the company enabling 
them to discharge their responsibilities effectively
the chairman reported the results of the evaluations at the board meeting held on 21 january 2014 the nominations 
committee confirmed to the board that the contributions made by the directors offering themselves for reelection at  
the agm in april 2014 continue to be effective and that the company should support their reelection
reelection
directors stand for election by shareholders at the first annual general meeting following their appointment and 
thereafter for reelection at intervals of no more than three years at each agm at least one third of the directors are 
required to retire the report from the nomination committee contained in this report explains the process for the 
selection of directors and succession planning copies of the nonexecutives’ letters of appointment are available  
for inspection at the company’s registered office and will be available at the annual general meeting
the chairman and other members of the board recommend that the directors retiring be reelected and their 
biographies can be found on page 38 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 continue to fulfil their functions responsibly  51
stv annual report  accounts 2013
risk management and internal control
risk is inherent in the company’s business and activities and the review of risk and risk management is embedded 
throughout the company the ability to identify assess monitor and manage each type of risk to which the company 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 the directors have overall responsibility for establishing and maintaining an adequate system of 
internal controls and risk management policies and also for reviewing the effectiveness of each this is communicated  
to the leadership team and each member is accountable for all risks assumed in their respective areas of responsibility 
and for the execution of appropriate risk management discipline 
these reviews included an assessment of internal controls in particular financial operational and compliance controls 
and risk management and their effectiveness and were supported by reports from the internal auditors as well as from 
the external auditors on matters identified in the course of their statutory audit work
during 2013 the following reviews were carried out by the internal auditors i an appraisal of the procedures to manage 
and exploit productions to maximise return on investment ii an assessment of the agresso accounting system and  
iii an evaluation of it resilience and disaster recovery 
the system 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 all points raised by the internal 
auditor were addressed and executive management believes that the control environment has been strengthened further 
by the actions taken a follow up review is carried out by the internal auditor of the work performed by management to 
implement the recommendations raised during the internal audit which will involve liaising with members of staff across 
the business who would have been allocated the responsibility of executing the recommendations raised and this will be 
supported by detailed testing where required a key element of the risk management process is the method of profiling 
risk this determines the threats to the achievement of business objectives and daytoday operations in terms of 
likelihood and consequence at a residual level after taking account of mitigating and controlling actions
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 
turnbull guidance 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
a highly detailed review process conducted on a multilevel basis ensures that the consolidated group accounts are 
prepared having taken into account the internal control procedures and risk management strategies outlined above directors’ report – corporate governance
52  corporate governance report 
continued
following the indepth review of the risk register carried out during 2012 and facilitated by deloitte the presentation 
and content of the risk register has now been developed in a way which now allows
• the key risks facing stv to be summarised
• actions taken to improve control to be tracked and 
• changes to the risk portfolio to be monitored
as with the previous risk register the revised one comprises risks specific to the different areas of the business and is 
reviewed and updated on an ongoing basis both at an operational level and on a biannual basis by the board with the 
audit committee conducting an annual review the register sets out the key risks that have been identified allocating  
an owner to each together with the risk impact likelihood and score both on a gross and after the current mitigating 
controls have been taken into account a net basis the effectiveness of the current mitigating controls is graded as 
either strong adequate or weak and any additional controls required is also noted
the company has a strong internal control and risk management system in place in relation both to the financial 
reporting process and the process for preparing the consolidated accounts the purpose of these is to ensure that the 
internal and external financial statements are presented in accordance with the relevant reporting standards and the 
disclosure requirements for listed companies as well as to ensure that the financial statements give a true and fair view 
free from material misstatement
the board is satisfied that these responsibilities are met through applying the following procedures which are supported 
by the group’s system of internal control
•  using an appropriate system of accounting records capable of operating with reasonable accuracy to be compliant 
with financial and legal reporting requirements the basis used to prepare stv’s financial statements is the 
international financial reporting standards ‘ifrs’ as adopted by the european union the company financial 
statements and directors’ remuneration report are prepared in accordance with applicable law and united kingdom 
generally accepted accounting practice
• using ifrs to ensure a true and fair view of the state of affairs of the group including the profit or loss for the period
• applying appropriate accounting policies within the framework of ifrs and ensuring these are consistently applied
• making judgements and preparing estimates that are reasonable and prudent
• operating within the guidelines of all the disclosure advice provided by uk statute
• considering whether adoption of the going concern basis is appropriate
• maintaining robust assurance processes and controls over financial reporting procedures and
• extending these principles to halfyearly reports and other reports in the public domain
identified risks are mitigated through unambiguous business processes with integrated risk management activities 
segregation of duties and appropriate delegation of authority each role within the company is welldefined with clear 
responsibilities and a transparent reporting structure the company’s business processes include financial controls 
regarding the approval and accounting of business transactions and the financial reporting process has controls 
regarding recognition measurement and disclosure these include the application of critical accounting policies and 
estimates in individual subsidiaries as well as in the consolidated accounts
regular review is vital to ensure that the risk culture continues to be embedded throughout the company and that the 
risk framework is operating effectively it also provides the board and the audit committee with an overall view of the 
company’s risk profile identifying any major exposures and mitigating actions 53
stv annual report  accounts 2013
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 audit committee  
no such concerns were raised by staff during the year
the risk management framework and internal controls system across the company which are subject to continuous 
development provides the basis on which the company has complied with the code provisions on internal control
relations with shareholders
stv’s corporate website at wwwstvplctv has information for institutional and private 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 recognises the importance of having an ongoing relationship with its shareholders and other stakeholders 
and fully supports the principles of the code which encourage open dialogue between companies and their 
shareholders the board welcomes and encourages the participation of all shareholders at the company’s annual 
general meeting which all directors attend shareholders also have the opportunity to meet with directors and ask 
questions after the formal business of the meeting has been concluded
institutional shareholders
stv undertakes a comprehensive programme of meetings and events for institutional investors and research analysts 
throughout the year and the board are kept fully informed of feedback given to the chief executive and chief financial 
officer in the course of their extensive round of investor meetings the board routinely receives updates on significant 
movements on the share register analysts’ consensus forecasts and market sentiment 
the chairman the senior independent director and other nonexecutive directors are available to meet with 
shareholders to discuss governance and strategy and develop a balanced understanding of their issues and concerns 
and various meetings have taken place with shareholders during the year discussions at these meetings are conveyed 
to all directors in order that each can develop an understanding of major shareholders’ views on the company 
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 company 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 
comprehensive assessment of the company’s position and prospects such communication is designed to establish  
a mutual understanding of objectives
 
private shareholders
we are always pleased to hear the views of our private shareholders and to answer queries by telephone or in writing 
through emailing our company secretary janetamesstvtv we encourage shareholders to make maximum use of  
our website to access company reports notices of meetings and general shareholder information shareholders can 
also check their shareholding at any time by visiting the registrar’s website at wwwcapitashareportalcom directors’ report – corporate governance
54 remuneration report
‘ … the 2013 remuneration report reflects 
the new reporting requirements providing 
increased transparency for shareholders’
vasa babic
chairman of the remuneration committee
annual statement
on behalf of the board i am pleased to introduce the directors’ remuneration report for the year ended 31 december 
2013 this report has been prepared by the remuneration committee and approved by the board
as a result of the strong financial performance delivered in 2013 payments have been triggered under the bonus plan 
through achievement of operating profit pbt cash flow and personal objectives targets no longterm incentives vested 
during the year and the next vesting date for a longterm incentive plan is 1 january 2016 for the 2013 value creation 
plan as a result of the improved share price performance since grant the value creation plan is on track to generate 
rewards at the end of the performance period
an extensive shareholder consultation exercise was concluded in early 2013 to approve the company’s remuneration 
policy and introduction of a new performancerelated bonus plan and value creation plan granted on 1 january 2013
since implementation of these changes the committee is reviewing the operation of the bonus plan with a view to 
simplification whilst maintaining the existing reward levels and maximum payment opportunities the committee will 
discuss its proposals with shareholders before making any changes
as required by the large and mediumsized companies and groups accounts and reports amendment regulations 
2013 the regulations this remuneration report is split into two parts
•  t h e directors’ remuneration policy sets out the policy for 2014 and the key factors that were taken into account  
in setting the policy the directors’ remuneration policy will be subject to a binding vote for a period of three years
•  t h e annual report on remuneration sets out payments and awards made to the directors and details the link 
between company performance and remuneration for the 2013 financial year the annual report on remuneration 
together with this annual statement is subject to an advisory shareholder vote at the agm on 23 april 2014
i look forward to receiving your support for the resolution seeking approval of the annual report on remuneration  
at our forthcoming agm as well as on the remuneration policy applicable to our directors which will apply from  
1 january 2014 55
stv annual report  accounts 2013
directors’ remuneration policy
this section of the remuneration report contains details of the company’s directors’ remuneration policy  
that will govern the company’s future remuneration payments
the policy described in this part is intended to apply for three years and will be applicable from 23 april 2014  
subject to approval by shareholders at the company’s agm on that date the policy part will be displayed on  
the company’s website in the investor relations section after the 2014 agm
the objective of stv’s remuneration policy is to encourage reward and retain the current executive directors and 
ensure their actions are aligned with the company’s strategy the committee applies the following principles to ensure 
alignment with the company’s strategic objectives targets and key performance indicators
• total compensation should be competitive and commensurate with comparable packages within the market
• a significant percentage of potential maximum reward should be conditional on longterm performance 
•  the interest of executives should be closely aligned with those of the company’s shareholders through the provision  
of equity incentives and
•  reward should be linked to the satisfaction of the targeted objectives linked to the company’s key  
performance indicators
at all times the committee seeks to act sensitively in determining executives’ remuneration to support this the 
remuneration committee reviews whether the remuneration policy remains appropriate for the relevant financial year 
taking into account factors such as
• market conditions
• the recruitment market in the company’s sector
• market practice
• the views of shareholders and their representative bodies
• corporate performance against the kpis set out on pages 27 and 28 of the annual report and
• pay and conditions throughout the group directors’ report – corporate governance
56  re m une r a t io n re p o r t 
continued
future policy table
executive directors
the table below sets out the key elements of the policy for executive directors
objective and link to strategy operation maximum opportunity performance conditions and assessment
base salary
the committee sets salaries as a retainer for the executive 
directors to recognise status and responsibility to deliver  
the strategy
salaries are reviewed annually and any changes are effective 
from 1 january in the financial year
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
• the performance of the individual executive director
•  the individual executive director’s experience  
and responsibilities
• pay and conditions throughout the company
annual rate for each executive director is set out in the  
statement of implementation of remuneration policy for  
2014 on page 75
salary levels will be set by reference to the median levels  
of salary of comparable companies within the media sector  
in general any salary increase applied to the executive  
directors’ will be in line with other employees in the group
none
benefits
to provide competitive levels of employment benefits  
consistent with role
executives are entitled to receive a taxable cash allowance  
in lieu of benefits in kind including car and private medical 
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
benefit values vary yearonyear depending on premiums  
and the maximum potential value is the cost of the provision  
of the benefits outlined
none
annual bonus
the bonus plan aligns reward to key strategic objectives  
over the shortmedium term
the bonus plan operates in respect of three plan years 
beginning in 2013 but pays out over four years
contributions to each participant’s bonus plan account  
are made following the publication of the audited financial 
statements based on the satisfaction of the performance 
targets
following the end of each of the three plan years 50 of  
the balance in the account is paid out the remaining 50  
is deferred as shares
the balance of the account pays out in the fourth year
a forfeiture provision applies such that 50 of the account 
balance is forfeited if a minimum threshold target is not met  
in any financial year
bonus plan payments are not pensionable
looking ahead the committee is reviewing the operation  
of the bonus plan with a view to simplification whilst 
maintaining the existing reward levels and maximum  
payment opportunities
the maximum annual contribution is 125 of salary  
for all executive directors
at threshold performance bonus payable is equivalent  
to 125 of maximum opportunity and at target performance 
bonus payable is equivalent to 50 of maximum opportunity
performance targets will be set annually based on  
a range of financial and strategic measures including
• operating profit 
• group pbt 
• cash flow 
• personal objectives
as well as determining the measure and targets the 
committee will also determine the weighting of the various 
measures to ensure that they support the business strategy 
and objectives for the relevant year
the committee has the discretion to adjust targets or 
performance measures for any exceptional events that  
may occur during the year
further details of the measures for 2014 are set out in  
the statement of implementation of remuneration policy  
on page 75
the committee is of the opinion that the performance targets 
for the bonus plan are commercially sensitive and it would be 
detrimental to the interests of the company to disclose them 
before the start of the financial year the targets therefore will 
be disclosed after the end of the relevant financial year in that 
year’s remuneration report 57
stv annual report  accounts 2013
future policy table
executive directors
the table below sets out the key elements of the policy for executive directors
objective and link to strategy operation maximum opportunity performance conditions and assessment
base salary
the committee sets salaries as a retainer for the executive 
directors to recognise status and responsibility to deliver  
the strategy
salaries are reviewed annually and any changes are effective 
from 1 january in the financial year
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
• the performance of the individual executive director
•  the individual executive director’s experience  
and responsibilities
• pay and conditions throughout the company
annual rate for each executive director is set out in the  
statement of implementation of remuneration policy for  
2014 on page 75
salary levels will be set by reference to the median levels  
of salary of comparable companies within the media sector  
in general any salary increase applied to the executive  
directors’ will be in line with other employees in the group
none
benefits
to provide competitive levels of employment benefits  
consistent with role
executives are entitled to receive a taxable cash allowance  
in lieu of benefits in kind including car and private medical 
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
benefit values vary yearonyear depending on premiums  
and the maximum potential value is the cost of the provision  
of the benefits outlined
none
annual bonus
the bonus plan aligns reward to key strategic objectives  
over the shortmedium term
the bonus plan operates in respect of three plan years 
beginning in 2013 but pays out over four years
contributions to each participant’s bonus plan account  
are made following the publication of the audited financial 
statements based on the satisfaction of the performance 
targets
following the end of each of the three plan years 50 of  
the balance in the account is paid out the remaining 50  
is deferred as shares
the balance of the account pays out in the fourth year
a forfeiture provision applies such that 50 of the account 
balance is forfeited if a minimum threshold target is not met  
in any financial year
bonus plan payments are not pensionable
looking ahead the committee is reviewing the operation  
of the bonus plan with a view to simplification whilst 
maintaining the existing reward levels and maximum  
payment opportunities
the maximum annual contribution is 125 of salary  
for all executive directors
at threshold performance bonus payable is equivalent  
to 125 of maximum opportunity and at target performance 
bonus payable is equivalent to 50 of maximum opportunity
performance targets will be set annually based on  
a range of financial and strategic measures including
• operating profit 
• group pbt 
• cash flow 
• personal objectives
as well as determining the measure and targets the 
committee will also determine the weighting of the various 
measures to ensure that they support the business strategy 
and objectives for the relevant year
the committee has the discretion to adjust targets or 
performance measures for any exceptional events that  
may occur during the year
further details of the measures for 2014 are set out in  
the statement of implementation of remuneration policy  
on page 75
the committee is of the opinion that the performance targets 
for the bonus plan are commercially sensitive and it would be 
detrimental to the interests of the company to disclose them 
before the start of the financial year the targets therefore will 
be disclosed after the end of the relevant financial year in that 
year’s remuneration report directors’ report – corporate governance
58  re m une r a t io n re p o r t 
continued
objective and link to strategy operation maximum opportunity performance conditions and assessment
longterm incentive plan
the company operates a value creation plan vcp to align  
the interests of the executive directors with those of 
shareholders by focusing on delivering superior returns  
to shareholders
each participant including the executive directors  
was granted performance units on 11 march 2013
subject to the performance criteria being met at the end  
of a three year performance period which commenced  
on 1 january 2013 these performance units will convert  
into a nilcost option over sufficient shares to deliver the 
participant’s share of the maximum incentive value
the nilcost option may be exercised until the tenth 
anniversary of the date of grant of the performance units
vcp payments are not pensionable
the table below sets out the number of performance units 
allocated to participants
participant performance units
r woodward 330000
g watt 170000
other participants 500000
total 1000000
the aggregate number of performance units under option  
as a result of the vcp is limited to one million
the maximum incentive value for all participants will be 
conditional upon achieving an average share price of £150  
or higher over the last 30 days of the three year performance 
period the measurement price 
the share price at date of grant on 1 january 2013 was £100
provided the measurement price is above £150 a percentage 
of the additional value created is used to create a pool the 
incentive value in line with the table below
measurement price contribution percentage
1
below £150 0
£150£200 5
above £200 75
1  the contribution percentage is the proportion of the value created 
allocated to participants
the incentive value calculated in accordance with the table 
above will be multiplied by the number of shares in issue at 
the measurement date to determine the maximum incentive 
value for all participants
pension
to provide competitive levels of retirement benefit the group operates a defined benefit db scheme  
closed to new members a defined contribution dc scheme 
available only by invitation and a group personal pension 
plan administered by nest executives have the option to 
receive a taxable cash allowance in lieu of pension benefits
neither of the executive directors are members of any 
company pension scheme and both receive a taxable cash 
allowance george watt was a participating member of the 
scottish and grampian television retirement benefits 
scheme which is an approved defined benefits occupational 
pension scheme until 31 march 2010 when he became a 
deferred member no benefits accrued under this scheme 
during 2013
both rob woodward and george watt are entitled to  
receive a pension contribution or a taxable cash allowance  
in lieu of pension benefits equal to 20 of salary
these cash payments are not included in base salary for  
the calculation of any other benefit including the value of  
incentive awards
under the dc scheme the company contribution is 65  
of base salary up to the pension earnings cap
none
saye
to strengthen alignment between the interest of staff  
and shareholders
the executive directors are eligible to participate in  
the company’s saveasyouearn plans as offered  
from time to time subject to hmrc limits
maximum contributions as defined by hmrc  
and subject to hmrc and plan rules
subject to hmrc and plan rules
shareholding requirement
to strengthen alignment between the interests of  
the executive directors and those of shareholders
executive directors are required to hold shares  
equivalent to 100 of their annual salary
share price is measured at the end of each financial year
100 of salary none
provisions of previous policy that will continue  
to apply 2012 bonus plan
the bonus plan aligns reward to key strategic objectives  
over the short to mediumterm 
50 of bonus paid for 2012 financial year was paid in  
cash and 50 will be released in shares in march 2014 59
stv annual report  accounts 2013
objective and link to strategy operation maximum opportunity performance conditions and assessment
longterm incentive plan
the company operates a value creation plan vcp to align  
the interests of the executive directors with those of 
shareholders by focusing on delivering superior returns  
to shareholders
each participant including the executive directors  
was granted performance units on 11 march 2013
subject to the performance criteria being met at the end  
of a three year performance period which commenced  
on 1 january 2013 these performance units will convert  
into a nilcost option over sufficient shares to deliver the 
participant’s share of the maximum incentive value
the nilcost option may be exercised until the tenth 
anniversary of the date of grant of the performance units
vcp payments are not pensionable
the table below sets out the number of performance units 
allocated to participants
participant performance units
r woodward 330000
g watt 170000
other participants 500000
total 1000000
the aggregate number of performance units under option  
as a result of the vcp is limited to one million
the maximum incentive value for all participants will be 
conditional upon achieving an average share price of £150  
or higher over the last 30 days of the three year performance 
period the measurement price 
the share price at date of grant on 1 january 2013 was £100
provided the measurement price is above £150 a percentage 
of the additional value created is used to create a pool the 
incentive value in line with the table below
measurement price contribution percentage
1
below £150 0
£150£200 5
above £200 75
1  the contribution percentage is the proportion of the value created 
allocated to participants
the incentive value calculated in accordance with the table 
above will be multiplied by the number of shares in issue at 
the measurement date to determine the maximum incentive 
value for all participants
pension
to provide competitive levels of retirement benefit the group operates a defined benefit db scheme  
closed to new members a defined contribution dc scheme 
available only by invitation and a group personal pension 
plan administered by nest executives have the option to 
receive a taxable cash allowance in lieu of pension benefits
neither of the executive directors are members of any 
company pension scheme and both receive a taxable cash 
allowance george watt was a participating member of the 
scottish and grampian television retirement benefits 
scheme which is an approved defined benefits occupational 
pension scheme until 31 march 2010 when he became a 
deferred member no benefits accrued under this scheme 
during 2013
both rob woodward and george watt are entitled to  
receive a pension contribution or a taxable cash allowance  
in lieu of pension benefits equal to 20 of salary
these cash payments are not included in base salary for  
the calculation of any other benefit including the value of  
incentive awards
under the dc scheme the company contribution is 65  
of base salary up to the pension earnings cap
none
saye
to strengthen alignment between the interest of staff  
and shareholders
the executive directors are eligible to participate in  
the company’s saveasyouearn plans as offered  
from time to time subject to hmrc limits
maximum contributions as defined by hmrc  
and subject to hmrc and plan rules
subject to hmrc and plan rules
shareholding requirement
to strengthen alignment between the interests of  
the executive directors and those of shareholders
executive directors are required to hold shares  
equivalent to 100 of their annual salary
share price is measured at the end of each financial year
100 of salary none
provisions of previous policy that will continue  
to apply 2012 bonus plan
the bonus plan aligns reward to key strategic objectives  
over the short to mediumterm 
50 of bonus paid for 2012 financial year was paid in  
cash and 50 will be released in shares in march 2014 directors’ report – corporate governance
60  re m une r a t io n re p o r t 
continued
notes to the policy table
performance measures and targets
the committee selected the performance conditions for the bonus plan because these are central to the company’s  
overall strategy and are the key metrics used by the executive directors to oversee the operation and performance of  
the business the performance targets are determined annually by the committee and are typically set at a level that  
is above the level of the company’s forecasts 
the board set objectives for the company over the period from 2012 to 2015 and the committee believes that the 
successful delivery of these objectives will flow through to a material increase in shareholder returns the value creation 
plan is designed to incentivise the executive directors to maximise shareholder returns by the successful delivery  
of these objectives and to share in the resulting increase in shareholder value
both the bonus plan and the vcp were approved by shareholders at the company’s agm on 24 april 2013
changes to remuneration policy from previous policy
there have been no changes to the operation maximum or performance measures in relation to the salary  
annual bonus pension and other benefits or the longterm incentives arrangements
discretion
the committee has discretion in several areas of policy as set out in this report the committee may also exercise 
operational and administrative discretions under relevant plan rules approved by shareholders as set out in those rules 
in addition the committee has the discretion to amend policy with regard to minor or administrative matters where it 
would be in the opinion of the committee disproportionate to seek or await shareholder approval
differences in remuneration policy for all employees
all employees of stv are entitled to base salary pension and benefits the maximum opportunity available is based  
on the seniority and responsibility of the role longterm incentive awards are only available to the leadership team  
and key senior staff by invitation 61
stv annual report  accounts 2013
nonexecutive directors
the table below sets out the key elements of the policy for nonexecutive directors
objective and  
link to strategy operation maximum
performance 
conditions  
and 
assessment
ned fees
to attract  
nonexecutive  
directors with  
the requisite  
skills and 
experience
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
neds are paid a base fee and additional fees for
•  carrying out the duties of senior independent 
ned and committees
•  an additional fee of for carrying out the specific 
duties of sitting on the company’s audit 
nomination andor remuneration committees
•  an additional fee on top of the committee fee  
to reflect the additional duties involved in chairing 
that committee
fees are reviewed annually with changes effective 
from 1 january any increases to fees will be 
determined based on workload and level of 
responsibility and current market rates
fees are paid in cash neds 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
current fee levels are set out in  
the statement of implementation  
of remuneration policy on page 75
the company’s policy is to set the 
level of fees by reference to the 
median level of fees in comparable 
companies within the media sector 
in general any increase in fees will 
be in line with increases in salary 
levels for employees in the group
none
recruitment remuneration policy
the committee’s approach to recruitment remuneration is to pay no more than is necessary to attract appropriate 
candidates to the role
the principle is that the pay of any new recruit would be assessed following the same principles as for the  
executive directors
the committee is mindful that it wishes to avoid paying more than it considers necessary to secure the preferred 
candidate and is mindful of guidelines and shareholder sentiment regarding oneoff or enhanced short or longterm 
incentive payments made on recruitment and the appropriateness of any performance conditions associated with  
an award
where an existing employee is promoted to the board the policy set out overleaf would apply from the date of promotion 
but there would be no retrospective application of the policy in relation to subsisting incentive awards or remuneration 
arrangements accordingly existing elements of the remuneration package of the employee would be honoured and 
form part of the ongoing remuneration for the person concerned directors’ report – corporate governance
62  re m une r a t io n re p o r t 
continued
the table below summarises the key policies with respect to recruitment remuneration
element policy
base salary  
and benefits
the salary level will be set taking into account 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 
level at those companies in the media sector and the pay and conditions throughout the company
the executive director shall be eligible to receive benefits in line with the company’s benefits policy  
as set out in the remuneration policy table
pension the executive director will be eligible to receive a supplement in lieu of pension contribution of 20  
of base salary or join the company’s dc scheme the stv pension scheme in line with stv’s pension policy 
as set out in the remuneration policy table
annual bonus the executive director will be eligible to participate in the bonus plan as set out in the remuneration  
policy table
the maximum annual contribution under this plan is 125 of salary for each bonus plan year
longterm 
incentives
the executive director will be eligible to participate in the company’s value creation plan set  
out in the remuneration policy table
under the value creation plan a maximum incentive value is determined for all participants at  
the end of the performance period as set out in the remuneration policy table new executives  
may be granted awards under the plan which will entitle them to a percentage of the maximum  
incentive value
maximum  
level  
of variable 
remuneration
the maximum annual variable remuneration that an executive director can receive is limited to  
125 of salary under the bonus plan
awards under the value creation plan have no value at grant but provide the participants with the 
opportunity to receive a percentage of the maximum incentive value see remuneration policy table
share  
buyouts
the committee will seek to structure any replacement awards such that overall they are no more generous  
in terms of quantum or vesting period than the awards due to be forfeited
in determining quantum and structure of these commitments the committee will seek to replicate  
the broadly equivalent economic value and as far as practicable the timing and performance requirements 
of remuneration foregone
relocation 
policies
in instances where the new executive relocates from one workbase to another the company will  
provide compensation to reflect the cost of relocation for the executive
the level of relocation package will be assessed on a case by case basis but will take into consideration  
any cost of living differences housing allowance and schooling in accordance with the company’s normal 
relocation package for employees
service contracts and payment for loss of office
when setting notice periods the committee has regard for market practice and corporate governance best practice 
notice periods will not be greater than 12 months
director 
date of contract 
letter of appointment unexpired term
notice period by  
company or director
executive director
r woodward 28 february 2007 rolling contract 12 months
g watt 27 february 2001 rolling contract 12 months 63
stv annual report  accounts 2013
director 
date of contract 
letter of appointment
dates of re
appointment
unexpired as at  
12 march 2014
nonexecutive director
baroness ford 1 june 2013 1 june 2013 2 years 2 months
d shearer 28 february 2007 18 april 2012 1 year 1 month
v babic 28 february 2007 24 april 2013 2 years 1 momth
j matheson 5 march 2007 24 april 2013 2 years 1 month
m jackson 1 may 2009 18 april 2012 1 year 1 month
g shore 1 march 2012 18 april 2012 1 year 1 month
all service contracts and letters of appointments are available for viewing at the stv group plc registered office
the table below sets out the company’s termination policy in respect of executive director contracts for each element  
of total remuneration for each element the table also sets out the boundaries of committee discretion to apply flexibility 
to the default position
element approach application of remuneration committee discretion
general when determining any loss of office payment for a 
departing individual the committee will always seek to 
minimise cost to the company whilst seeking to reflect  
the circumstances in place at the time
the committee reserves the right to make  
additional payments where such payments are  
made in good faith in discharge of an existing legal 
obligation or by way of damages for breach of such 
obligation or by way of settlement or compromise 
of any claim arising in connection with the 
termination of an executive director’s discharge  
of office or employment
base  
salary 
pension  
and  
benefits
in the event of termination by the company there will  
be no compensation for loss of office due to misconduct 
or normal resignation in other circumstances executive 
directors may be entitled to receive compensation for  
loss of office which will be paid monthly for a maximum  
of twelve months such payments will be equivalent to  
the monthly salary pension supplements and benefits 
that the executive would have received if still in employment 
with the company executive directors will be expected  
to mitigate their loss within a 12 month period of their 
departure from the company
none
annual  
bonus
the treatment of bonus plan awards is governed  
by the rules as approved by shareholders
where an executive director’s employment is 
terminated they will forfeit the unpaid balance of the 
plan account unless the reason for the termination is 
one of the following circumstances death illhealth 
injury disability redundancy retirement  
by agreement with the company by which he is 
employed or where the committee determines  
the award holder is a ‘good leaver’
in such circumstances the company will make a 
distribution to the executive director of the whole of the 
plan account at the date of cessation further on the 
next normal measurement date if the board determines 
that a bonus plan contribution should be made then 
the executive’s contribution will be prorated to reflect 
the period worked in that performance year
as per the plan rules approved by shareholders on 
24 april 2013 the committee retains the discretion  
to consider an executive to be a ‘good leaver’ with 
the effect set out on the left
it should be noted that it is the committee’s policy  
to only apply its discretion if the circumstances at 
the time are in its opinion sufficiently exceptional 
and to provide a full explanation to shareholders 
where discretion is exercised directors’ report – corporate governance
64  re m une r a t io n re p o r t 
continued
element approach application of remuneration committee discretion
longterm 
incentive
the treatment of awards granted under the  
vcp is governed by the rules as approved  
by shareholders
the performance conditions will be measured at  
the normal measurement date at the end of the three 
year performance period
on termination of employment prior to the performance 
measurement date ie before the conversion of 
performance units into nilcost options all 
performance units will lapse unless one of the following 
circumstances apply death ill health injury or disability 
redundancy retirement by agreement with the company 
by which he is employed the award holder is employed  
by a company that ceases to be part of stv group plc 
the award holder is employed in an undertaking or part 
of an undertaking that is transferred to a person who is 
not an stv group plc member or any other circumstances 
if the board so determines in a particular case
if an executive director leaves under a circumstance set 
out above the committee may use its discretion to 
determine that all or a proportion of the performance units 
shall convert on the measurement date
on death or termination of employment after the 
measurement date the executive director will be 
entitled to exercise their nilcost options at any  
time during the period permitted by the committee
as per the plan rules approved by shareholders on 
24 april 2013 the committee retains the discretion  
to consider an executive to be a ‘good leaver’ with 
the effect set out on the left
the committee has the discretion whether to  
prorate the number of performance units that  
may convert into nilcost options at the normal 
measurement date
for performance units that are converted on 
termination the committee can determine the 
period over which the nilcost options may be 
exercised
it should be noted that it is the committee’s policy  
to only apply its discretion of the circumstances at 
the time are in its opinion sufficiently exceptional 
and to provide a full explanation to shareholders 
where discretion is exercised
saye plan the treatment of the saye plan will be in accordance  
with hmrc and plan rules
other 
contractual 
obligations
there is no contractual provision agreed prior  
to 27 june 2012 that could impact quantum  
of the payment
change  
of control
bonus  
plan
on a change of control the value of participant’s  
plan account will be released
the committee will take into account such factors  
as it considers relevant in relation to the bonus plan 
contribution for the year in which the event occurs 
including the proportion of the bonus plan year 
elapsed at the date of the event
value  
creation  
plan
the three year performance period will end on a change 
of control performance units may convert into nilcost 
options immediately prior to the change of control 
based on the satisfaction of the performance criteria
in exceptional circumstances the committee may 
in its absolute discretion determine the proportion 
of the performance units which shall be capable of 
conversion shall be reduced to take account of the 
period from the date of change of control as a 
proportion of the period from the award date until 
the original measurement date 65
stv annual report  accounts 2013
£000
900
800
700
600
500
400
300
200
100
0
minimum
5
illustrations of application of remuneration policy
the graphs below seek to demonstrate how pay varies with performance for the executive directors based  
on our stated remuneration policy 
rob woodward george watt
 
assumptions used in determining the level of payout under given scenarios are as follows
element minimum ontarget maximum
fixed elements fixed elements do not vary with 
performance and comprise
– 2014 base salary 
– benefits 
–  cash in lieu of pension contributions  
at 20 of base salary
annual variable element
bonus plan
annual cash element where  
performance measures relate  
to one financial year
0 25 of  
maximum  
annual  
contribution
12
50 of  
maximum  
annual  
contribution
1
multiple reporting  
period elements
bonus plan
deferred element where  
performance measures relate  
to more than one financial year
0 25 of  
maximum  
annual  
contribution
12
50 of  
maximum  
annual  
contribution
1
value creation plan 0 50 of 
maximum
3
onethird of total 
ifrs2 charge
3
notes 
1 maximum annual contribution is 125 of salary for each executive director
2 a level of 50 vesting for ‘ontarget’ performance
3  the 2013 vcp is a oneoff award granted for the next 3 year period the maximum value represents onethird of the total illustrative ifrs2  
fair value of the performance units at the date of grant for an individual as set out in the company’s consolidated statement of income
4  in accordance with the uk government’s new remuneration reporting regulations no allowance has been made for share price appreciation
  multiple variable reporting
 annual variable
 fixed
  multiple variable reporting
 annual variable
 fixed
£000
900
800
700
600
500
400
300
200
100
0
minimum minimum on target on target maximum maximum
100 76 60
100 76 60
19
19
5
10
10
30
30 directors’ report – corporate governance
66  re m une r a t io n re p o r t 
continued
consideration of employment conditions elsewhere in the company in developing policy
in making annual pay decisions the committee also gives consideration to pay and employment conditions in the rest  
of the company the committee is provided with data on the remuneration structure for the executive leadership team 
and uses this information to work with the hr team to ensure consistency of approach throughout the company
to appraise itself of conditions elsewhere in the company the committee invites the hr  communications director  
to present on the proposals for salary increases for the employee population generally and on any other changes to 
remuneration policy within the company
the 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
although the committee takes into account the pay and conditions of other employees the company did not consult 
with employees when drawing up the policy report
no comparison metrics were used by the committee
consideration of shareholder views
the views of our shareholders are very important and the committee welcomes constructive feedback with respect  
to the remuneration policies or structure which we take on board to formulate our arrangements
the committee consulted with its major shareholders in early 2013 to receive feedback on the remuneration  
policy and the introduction of the bonus plan and value creation plan to understand their views and expectations  
the major shareholders consulted were supportive of the proposed introduction of the new incentive arrangements  
and overall remuneration policy
in preparing this report we have had regard to comments provided over the year by shareholders and institutional 
investor representative bodies 67
stv annual report  accounts 2013
annual report on remuneration
this section of the remuneration report is audited and contains details of how the company’s 2013 remuneration policy 
for directors was implemented during the financial year ending on 31 december 2013
single total figure of remuneration
executive directors
the table below sets out the single total figure of remuneration and breakdown for each executive director paid in the 
2013 financial year comparative figures for 2012 have also been provided figures provided have been calculated in 
accordance with the new remuneration disclosure regulations the large and mediumsized companies and groups 
accounts and reports amendment regulations 2013
executive director
salary 
£000
taxable  
benefits 
£000
annual  
bonus 
£000
longterm 
incentives
1
 
£000 pension total
r woodward 2013 380 16 129 na 76 601
2012 380 16 117 107
1
76 696
g watt 2013 214 16 73 na 43 346
2012 214 16 66 53
1
43 392
notes
1 value of awards at the vesting date at a share price of £100 per share on 31 december 2013 directors’ report – corporate governance
68  re m une r a t io n re p o r t 
continued
nonexecutive directors
nonexecutive directors do not participate in any of the company’s incentive arrangements nor do they receive any 
benefits the table below sets out the single total figure of remuneration and breakdown for each nonexecutive director
nonexecutive  
director
financial  
year
basic fees  
£
additional fees
1
  
£
total fees  
£
r findlay retired 31 august
2
2013 56667 – 56667
2012 85000 – 85000
baroness ford appointed 1 june
2
2013 55416 – 55416
2012 na na na
d shearer 2013 40000 7500 47500
2012 40000 7500 47500
v babic 2013 30000 7500 37500
2012 30000 7500 37500
j matheson 2013 30000 5000 35000
2012 30000 5000 35000
m jackson 2013 30000 5000 35000
2012 30000 5000 35000
g shore 2013 30000 5000 35000
2012 25000 – 25000
notes 
1  additional fees relate to a fee of £5000 per annum for sitting on the company’s audit andor remuneration committees and an additional fee  
of £2500 per annum to reflect the additional duties involved in chairing that committee
2 richard findlay retired on 31 august 2013 and baroness ford was appointed on 1 june 2013
additional details in respect of single total figure table
taxable benefits
executives are entitled to receive a taxable cash allowance in lieu of benefitsinkind including car and private  
medical insurance
executive director
cash allowance  
in lieu of  
benefitsinkind  
£000
r woodward 2013 16
2012 16
g watt 2013 16
2012 16 69
stv annual report  accounts 2013
annual bonus
performance against the performance conditions for the bonus plan for the year ended 31 december 2013
in respect of the year under review the executive directors’ performance was carefully reviewed by the committee  
and performance as against the bonus plan measures is summarised below
performance 
condition weighting
threshold 
annual 
contribution 
 salary
maximum 
annual 
contribution 
 salary targets
annual 
performance 
outcome
actual 
contribution  
 salary
   contribution to  
   plan account for 2013
r woodward g watt
operating 
profit
25 3125 3125 threshold £162m
max £207m
£180m 16 £59374 £33468
group  
pbt
25 3125 3125 threshold £137m
max £174m
£152m 16 £59374 £33468
cash flow 25 3125 3125 threshold £121m
max £155m
£138m 18 £68170 £38426
personal 
objectives
25 3125 3125 targets relating to 
delivery of growth 
plans for stv 
productions delivery 
of growth plans for 
digital activities 
achievement of 
outcome in 
commercially sensitive 
negotiations progress 
against kpi targets
18 £71250 £40162
total 100 125 125 £258168 £145524
the committee exercised their discretion in respect of the personal objectives performance condition it was felt that  
the amount awarded reflects the progress achieved and performance delivered during 2013 
the personal objectives were set at the start of the year by the committee and relate to strategic business targets  
the committee assessed performances against these targets and concluded that they had been partially satisfied  
at the end of the financial year this resulted in a bonus payment equal to 1875 of salary to each executive director 
the committee considers that the actual performance targets and outcomes relating to the personal objectives element  
of the 2013 bonus plan and are commercially sensitive at this current time on the basis that disclosure could damage 
the company’s final outcomes  directors’ report – corporate governance
70  re m une r a t io n re p o r t 
continued
bonus deferred under the bonus plan
under the bonus plan the earned bonus for the year is added to each individual executive director’s plan account  
50 of the balance on the plan account at the end of the financial year is released and 50 deferred see remuneration 
policy table on pages 56 and 57 for details on the operation of the bonus plan the deferred balances on each executive 
director’s plan account are set out below
executive 
directors
a plan  
account 
brought 
forward 
shares
b plan  
account 
brought 
forward 
£
c  
contr 
ibution  
into plan 
account  
for 2013 
£
d plan  
account 
balance  
following 
contr 
ibution  
for 2013 
£
e amount 
released  
following 
contr 
ibution  
for 2013 
£
f amount 
released  
of which 
annual  
bonus  
50 of 
column c 
£
g amount 
released  
of which  
lti  
column  
e less  
column f 
£
h plan  
account 
carried 
forward 
£
i plan  
account 
carried 
forward 
shares
r woodward – – 258172 258172 129086 129086 – 129086 43245
g watt – – 145528 145528 72764 72764 – 72764 24376
the plan account balance carried forward is subject to an annual performance condition related forfeiture threshold 
where the forfeiture threshold is not achieved in the following bonus plan year 50 of the balance of the plan account 
earned in respect of previous bonus plan years but not paid will be forfeited
longterm incentives
no longterm incentives vested in the financial year the vcp is due to vest in 2016 further details are available  
on page 58 71
stv annual report  accounts 2013
total pension entitlements
the company 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 neither of the executive 
directors are members of any company pension scheme and both receive a taxable cash allowance george watt  
is a deferred member of the defined benefits scheme and as such no additional value was accrued by him under this 
plan during the year for reference the following payments were made in respect of this
executive director
cash in lieu in 2013  
£000
cash in lieu in 2012  
£000
r woodward 76 76
g watt 43 43
scheme interests awarded in 2013 financial year
the table below sets out the details of the longterm incentive awards granted in the 2013 financial year where vesting 
will be determined according to the achievement of performance conditions that will be tested in future reporting 
periods no nonexecutive directors received scheme interests during the financial year
executive director
type of  
interest  
awarded
basis  
on which  
award made
face value  
of award  
made
1
percentage 
receivable  
for minimum 
performance 
end of  
performance  
period
r woodward performance unit awards have  
been made  
under the vcp
see note  
below
100 1 january 2016
g watt performance unit awards have  
been made  
under the vcp
see note  
below
100 1 january 2016
notes
1  the performance units have no value on grant performance units will convert into a number of nilcost options at the end of the 
performance period provided the performance conditions are achieved the holding period before the nilcost options vest will be three 
years from the date of grant on 24 april 2013 see policy table for details on the maximum incentive value payable to all participants
payments to past directors
no payments to past directors were made during the year 
payments for loss of office
no payments for loss of office were made during the year statement of directors’ shareholding and share interests
executive directors are required to build up a shareholding equal to 100 of salary the table below summarises  
the directors’ interests in shares and the extent to which the shareholding requirements have been achieved
shareholding
2012  
bonus  
plan  
interests
2
saye  
interests
director
shares  
required  
to be  
held  
 salary
number  
of  
shares  
required  
to hold
number  
of  
beneficially  
owned  
shares
1
 
number  
of  
deferred  
bonus  
plan  
shares  
subject to 
conditions 
number  
of  
options  
subject to 
conditions
total  
interests  
held at  
31 dec 2013
shareholding 
requirements
3
executive
r woodward 100 127303 460881 58634 7337 460881 met
g watt 100 71758 234260 33020 7337 234260 met
nonexecutive directors
baroness ford – – 23258 – – – –
d shearer – – 100000 – – – –
v babic – – – – – – –
j matheson – – 12500 – – – –
m jackson – – – – – – –
g shore – – 16063 – – – –
notes 
1 beneficial interests include shares held directly or indirectly by connected persons
2  half of 2012 bonus award is payable in shares and will be awarded in 2014 2013 bonus plan shares will be awarded in 2014 and are therefore  
not included in this table
3 shareholding requirement calculation excludes invested awards
directors’ report – corporate governance
72  re m une r a t io n re p o r t 
continued 73
stv annual report  accounts 2013
the following table sets out the details of the vested options exercised during the year
executive type of award
exercised  
during the year
exercise price of 
exercised options
market value  
on exercise
gain on  
exercise
r woodward 2009 ltip 84463 nil £132share £111913
g watt 2009 ltip 48630 nil £132share £64434
2012 bonus plan awards
under the 2012 performance related bonus plan bonus payments commenced at 90 of fulfilment of targets with 
bonus potential maximum payable upon achievement of performance levels of 125 of targets bonus payments are 
payable in two tranches with the first payment payable in cash due in march 2013 and the deferred and final payment 
payable in shares at a price of 100 pence representing the closing share price at the end of the performance period 
payable in march 2014
accordingly rob woodward received a cash payment of £58634 in march 2013 and a share award of 58634 shares  
in march 2014 george watt received a payment of cash payment of £33020 in march 2013 and an award of 33020 
shares in march 2014
2009 ltip
this award was approved by shareholders on 22 april 2009 and was granted on 7 may 2009 a total of one million  
units were awarded in total to participants with rob woodward and george watt receiving 330000 and 190000 units 
respectively following the testing of the performance conditions nil cost awards vested on 12 november 2012 of 
which 84463 ordinary shares were awarded to rob woodward and 48630 ordinary shares were awarded to george 
watt these can be exercised until the seventh anniversary of the date of grant
both executives exercised their awards in 2013
saye awards
under an allemployee share based save as you earn saye scheme launched in june 2011 both rob woodward  
and george watt were each granted 7337 options under the scheme a second all employee save as you earn saye 
scheme was launched in october 2013 neither rob woodward or george watt were eligible to participate in this 
scheme as both are contributing to the 2011 scheme at the hmrc contribution limit
shareholder dilution
the company operates all of its share arrangements for all employees within the association of british insurers 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  the following table sets out the current level of dilution against the abi limits for all share plans and discretionary 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 414 008
5 dilution in ten years 292 042
performance graph and table
the graph below shows the company’s performance measured by total shareholder return tsr compared with the 
performance of the ftse small cap media index this ftse small cap media index was selected because the 
company is part of this index
the table below shows the executive officer’s remuneration package over the past 5 years
year
single figure  
of total  
remuneration  
£000
 
r woodward
1
bonus  
payout  
as   
maximum  
opportunity
12
longterm  
incentive  
vesting  
rates  
as   
maximum  
opportunity
2013 601 54 –
2012 696 31 100
2011 958 15 –
2010 472 90 –
2009 472 – –
notes
1  2011 single figure of remuneration of £958000 includes deferred bonus payment of £427500 from 2010 bonus plan which carried  
performance conditions
2 maximum potential bonus opportunity has varied in the period between 2009 and 2013 and therefore this is not a likeforlike comparison
directors’ report – corporate governance
74  re m une r a t io n re p o r t 
continued
2008 2009 2010 2011 2012 2013
50
0
100
150
200
250
300
400
350
500
450
stv group plc
ftse small cap media index 75
stv annual report  accounts 2013
percentage change in chief executive officer’s remuneration
the table below compares the percentage increase in the chief executive officer’s remuneration including salary 
taxable benefits and annual bonus with the wider employee population between 2012 and 2013 the company 
considers the fulltime employee population excluding executive directors to be an appropriate comparator group and  
the most stable point of comparison
salary
taxable  
benefits bonus
1
  
increase
  
increase
  
increase
chief executive officer £000 – – 10
total employee pay £m
2
4 11 28
average employee pay £000 9 – 33
notes
1  half of 2013 bonus payment is subject to deferral and forfeiture conditions
2 average employee numbers were 396 in 2013 and 376 in 2012
relative importance of spend on pay
the table below sets out the relative importance of spend on pay in the 2013 financial year and 2012 financial year 
compared with other disbursements from profit these were the most significant outgoings for the company in the  
last financial year
significant distributions
disbursements  
from profit in 2013 
financial year
disbursements  
from profit in 2012  
financial year
  
change
£m
 total 
spend £m
 total 
spend
overall spend on pay including directors 165 18 162 18 –
profit distributed by way of dividend or share buyback – – – – – directors’ report – corporate governance
76  re m une r a t io n re p o r t 
continued
statement of implementation of remuneration policy in the following financial year
executive directors
the remuneration policy and its implementation for the forthcoming financial year is summarised below
salary
the salaries for 2014 are set out below
executive director
2013 
salary  
£000
2014 
salary  
£000
  
increase
r woodward 380 380 –
g watt 214 214 –
the base salary levels of executive directors have not been increased since 2007 and this will continue during 2014 
salary levels of employees throughout the company were increased by an average of 31 in 2014
benefits and pension
no changes are proposed to the provision of benefits or pension in 2014 as set out in the directors’ remuneration 
policy section on pages 55 to 66
bonus plan
see remuneration policy table on pages 55 to 66 for details on the operation of the bonus plan
the committee is of the opinion that the performance targets for the bonus plan are commercially sensitive in respect  
of the company and that it would be detrimental to the interests of the company to disclose them before the start of the 
financial year the targets will be disclosed after the end of the relevant financial year in that year’s remuneration report
the bonus payable to each of the chief executive officer and the chief financial officer is determined by reference to 
the performance conditions outlined in the table below
              r woodward             g watt 
performance condition weighting targets
threshold  
bonus  
contribution
maximum  
bonus  
contribution
threshold  
bonus  
contribution
maximum  
bonus  
contribution
operating profit 25 for  
disclosure  
at end  
of 2014  
financial  
year
3125 3125 3125 3125
group pbt 25 3125 3125 3125 3125
cash flow 25 3125 3125 3125 3125
personal objectives 25 3125 3125 3125 3125
totals 125 125 125 125
since implementation of the bonus plan the committee is reviewing the operation of the bonus plan with a view  
to simplification whilst maintaining the existing reward levels and maximum payment opportunities
longterm incentives
no changes are proposed to the current operation of the company’s longterm incentive arrangements  
in 2014 the operation of the vcp is set out in the directors’ remuneration policy on page 58 77
stv annual report  accounts 2013
nonexecutive directors
the following table sets out the fee rates for the nonexecutive directors in the year ended 31 december 2013
fee
2013 
£
2014
1
 
£
 
increase
1
chairman fee 95000 95000 –
senior independent director fee 40000 45000 125
ned basic fee 30000 32500 83
committee membership fee 5000 5000 –
chair of committee fee 2500 2500 –
notes
1 the 2014 fees will apply from 1 may 2014
consideration by the directors’ of matters relating to director’s remuneration
members of the committee
at 31 december 2013 the committee comprised of three independent nonexecutive directors vasa babic chairman 
jamie matheson and michael jackson the members of the committee have no personal financial interest other than as 
shareholders in matters to be decided no potential conflicts of interest arising from cross directorships and no dayto
day involvement in the running of the business
director
number of meetings  
during term
number of meetings  
attended
v babic 2 2
j matheson 2 2
m jackson 2 1
the committee is responsible for recommending to the board the remuneration policy for executive directors and the 
senior management and for setting the remuneration packages for each executive director the committee also has 
oversight of the remuneration policy and packages for other senior members of staff
the committee has formal terms of reference which describes its full remit this can be downloaded from the stv 
website wwwstvplctv directors’ report – corporate governance
78  re m une r a t io n re p o r t 
continued
the committee’s activities during the 2013 financial year included
meeting items discussed
18 february 2013 conclusion of shareholder consultation on future remuneration arrangements implementation of new 
remuneration arrangements approval of 2012 performance related bonus payments review and approval 
of 2012 remuneration report and remuneration related shareholder communications for agm
12 december 2013 remuneration policies 2013 performance related bonus payments
advisors to the committee
the committee appointed and received advice over the year from independent remuneration consultants 
pricewaterhousecoopers llp who acquired halliwell consulting the previous advisers in december 2008  
halliwell consulting were selected as advisors by the committee through a competitive tendering process
work undertaken by pricewaterhousecoopers llp for the committee included updating the committee on trends  
in compensation and governance matters and advising the committee in connection with the design and operation  
of the company’s incentive arrangements
pricewaterhousecoopers llp was paid £51000 in 2013 pricewaterhousecoopers llp is a member of the 
remuneration consultants’ group and has signed up to that group’s code of conduct on that basis the committee  
is satisfied that the advice received is objective and independent
pricewaterhousecoopers llp is also the company’s statutory auditors the committee reviewed the nature of  
the services provided and was satisfied that no conflict of interest exists or existed in the provision of these services  
the committee reviews the objectivity and independence of the advice it receives from pricewaterhousecoopers llp 
annually and it is satisfied that pricewaterhousecoopers llp is providing robust and professional advice
in the course of its deliberations during the period under review the 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 hr  communications director attend meetings by invitation except when their individual 
remuneration arrangements are discussed
statement of voting at general meeting
the table below shows the advisory vote on the 2012 remuneration report the bonus plan and the value creation plan 
at the agm held on 24 april 2013
votes  
for 
votes  
against 
votes  
withheld 
2012 remuneration report 19771058 9994 12848 006 17722 009
2013 bonus plan 19779208 9991 17616 009 4804 002
2013 value creation plan 16849568 9984 27000 016 2925060 1477
  a vote withheld is not a vote in law and counts neither for nor against a resolution 
the 2014 agm is the first time the directors’ remuneration policy will be put to a shareholder vote 
please note that the first votes on the annual report on remuneration and the directors’ remuneration policy are due  
to take place at the 2014 agm
vasa babic
remuneration committee chairman
12 march 2014 79
stv annual report  accounts 2013
accounts
contents
contents
accounts
80  stv group plc consolidated financial  
statements – independent auditors’ report 
84 consolidated income statement
84  c o ns o li d a t e d s t a t e m e n t  
of comprehensive income
85 consolidated balance sheet
86 consolidated statement of changes in equity
87 consolidated statement of cash flows
88 notes to the financial statements
112  stv group plc company financial statements 
– independent auditors’ report
114 company balance sheet
115  statement of total recognised  
gains and losses
116 notes to the company financial statements
122 fiveyear summary
shareholders
123 shareholder information
125 notice of annual general meeting accounts
80  stv group plc consolidated financial statements 
independent auditors’ report to the members of stv group plc
report on the group financial statements
our opinion 
in our opinion the group financial statements  
defined below
•  give a true and fair view of the state of the group’s 
affairs as at 31 december 2013 and of the group’s profit 
and cash flows for the year then ended
•  have been properly prepared in accordance with 
international financial reporting standards ifrss as 
adopted by the european union and
•  have been prepared in accordance with the 
requirements of the companies act 2006 and article 4 
of the ias regulation
this opinion is to be read in the context of what we say in 
the remainder of this report
what we have audited
the group financial statements which are prepared  
by stv group plc comprise
•  the group statement of financial position as at  
31 december 2013
•  the group income statement and statement of 
comprehensive income for the year then ended
•  the group statement of changes in equity and statement 
of cash flows for the year then ended and
•  the notes to the group financial statements which 
include a summary of significant accounting policies  
and other explanatory information
the financial reporting framework that has been applied  
in their preparation comprises applicable law and ifrss  
as adopted by the european union
certain disclosures required by the financial reporting 
framework have been presented elsewhere in the annual 
report and accounts the “annual report” rather than in 
the notes to the financial statements these are cross
referenced from the financial statements and are identified 
as audited
what an audit of financial statements involves 
we conducted our audit in accordance with international 
standards on auditing uk and ireland ‘isas uk  
ireland’ an audit involves obtaining evidence about the 
amounts and disclosures in the financial statements 
sufficient to give reasonable assurance that the financial 
statements are free from material misstatement whether 
caused by fraud or error this includes an assessment of
•  whether the accounting policies are appropriate to  
the group’s circumstances and have been consistently 
applied and adequately disclosed
•  the reasonableness of significant accounting estimates 
made by the directors and 
• the overall presentation of the financial statements 
in addition we read all the financial and nonfinancial 
information in the annual report to identify material 
inconsistencies with the audited group financial statements 
and to identify any information that is apparently materially 
incorrect based on or materially inconsistent with the 
knowledge acquired by us in the course of performing the 
audit if we become aware of any apparent material 
misstatements or inconsistencies we consider the 
implications for our report
overview of our audit approach
materiality
we set certain thresholds for materiality these helped us 
to determine the nature timing and extent of our audit 
procedures and to evaluate the effect of misstatements 
both individually and on the financial statements as a whole
based on our professional judgement we determined 
materiality for the group financial statements as a whole  
to be £717000 this represents approximately 5 of profit 
before tax which we consider to be the most relevant 
measure of underlying performance 
we agreed with the audit committee that we would report 
to them misstatements identified during our audit above 
£35900 as well as misstatements below that amount that 
in our view warranted reporting for qualitative reasons
overview of the scope of our audit
the group is structured in two business lines being 
consumer and production the group financial statements 
are a consolidation of 18 reporting units comprising the 
group’s operating entities within the consumer and production 
divisions in addition to some centralised functions
in establishing the overall approach to the group audit  
we determined the type of work that needed to be 
performed at the reporting units by us as both the group 
engagement team and component auditors we audited 
the complete financial information of 15 of the 18 reporting 
units using materiality levels appropriate for their individual 
statutory accounts that were lower than the materiality 
determined for the group financial statements as a whole 
these reporting units account for 100 of group turnover 
profit before tax and net assets this gave us the evidence 
we needed for our opinion on the group financial 
statements as a whole 
areas of particular audit focus
in preparing the financial statements the directors made a 
number of subjective judgements for example in respect 
of significant accounting estimates that involved making 
assumptions and considering future events that are 
inherently uncertain we primarily focused our work in 
these areas by assessing the directors’ judgements  81
stv annual report  accounts 2013
against available evidence forming our own judgements 
and evaluating the disclosures in the financial statements 
in our audit we tested and examined information using 
sampling and other auditing techniques to the extent we 
considered necessary to provide a reasonable basis for us 
to draw conclusions we obtained audit evidence through 
testing the effectiveness of controls substantive 
procedures or a combination of both 
we considered the following areas to be those that 
required particular focus in the current year this is not a 
complete list of all risks or areas of focus identified by our 
audit we discussed these areas of focus with the audit 
committee their report on those matters that they 
considered to be significant issues in relation to the 
financial statements is set out on page 46
area of focus
how the scope of our audit  
addressed the area of focus
retirement 
benefit schemes 
the retirement 
benefit obligation is 
sizeable in the 
context of the 
group and is 
dependent on key 
assumptions 
adopted by the 
directors in the 
actuarial valuation 
refer also to note 
28 to the financial 
statements
we considered the reasonableness  
of the key assumptions used in the 
actuarial valuation being the discount 
rate rpi cpi and mortality rates 
assessing if they were within our 
expected range 
for any assumptions that fell outside of 
our expected range we challenged the 
directors on their rationale for the 
assumption and what evidence they 
had to support it taking into account 
factors caused by the specific industry 
and location we also tested the 
completeness of the census data given 
to the scheme actuaries on which to 
base their valuations in addition we 
obtained thirdparty confirmations of 
the assets held within the pension 
schemes and considered their validity
inventory 
valuation
we focused on  
this area because  
of the level of 
judgement involved 
in calculation of the 
amount to be 
deferred on the 
balance sheet in 
respect of production 
stock in order to 
take account of 
future revenue 
which will be 
generated from 
these programmes 
refer also to note 
17 of the financial 
statements
we analysed the directors’ assessment 
of each production in the catalogue to 
determine based on the past history  
of sales and licence periods the 
appropriateness of management’s 
projected future revenues which are 
expected to be generated from the 
productions through secondary sales 
in the uk and abroad and new media 
sales routes we also considered the 
actual sales in 2013 against forecast  
to establish the level of accuracy  
in management’s forecasting and 
reperformed management’s 
calculations of forecast revenues  
on a net present value basis
fraud in revenue 
recognition 
isas uk  ireland 
presume there is a 
risk of fraud in 
revenue 
recognition 
because of the 
pressure 
management may 
feel to achieve the 
planned results 
we focused on  
the timing of  
the recognition  
of revenue
refer also to note 
3 of the financial 
statements
as the foundation of the evidence  
we obtained regarding the revenue 
recognised during the year we 
evaluated the relevant  
it systems and tested the internal 
controls over the completeness 
accuracy and timing of revenue 
recognised in the financial statements 
we tested a sample of revenue to 
invoice and cash receipts to verify the 
accuracy and occurrence of revenue 
we tested the timing of revenue 
recognised around the yearend date 
to check it was recorded in the correct 
period we also tested journal entries 
posted to revenue accounts to identify 
unusual or irregular items accounts
82  stv group plc consolidated financial statements 
 independent auditors’ report to the members of stv group plc  
continued
risk of 
management 
override of 
internal controls
isas uk  
ireland require 
that we consider 
this
we assessed the overall control 
environment of the group including the 
arrangements for staff to ‘whistleblow’ 
inappropriate actions and interviewed 
senior management and reviewed 
reports prepared by the internal 
auditors we examined the significant 
accounting estimates and judgements 
relevant to the financial statements for 
evidence of bias by the directors that  
may represent a risk of material 
misstatement due to fraud  
we assessed the overall control 
environment of the group in particular 
we considered the assumptions used 
in the retirement benefit scheme 
valuations and inventory cost deferral 
calculation we also tested journal 
entries and built in a level of 
unpredictability to our testing such  
as testing some low value balances
going concern
under the listing rules we are required to review the 
directors’ statement set out on page 25 in relation  
to going concern we have nothing to report having 
performed our review
as noted in the directors’ statement the directors have 
concluded that it is appropriate to prepare the group’s 
financial statements using the going concern basis of 
accounting the going concern basis presumes that the 
group has adequate resources to remain in operation  
and that the directors intend it to do so for at least one 
year from the date the financial statements were signed 
as part of our audit we have concluded that the directors’ 
use of the going concern basis is appropriate
however because not all future events or conditions  
can be predicted these statements are not a guarantee  
as to the group’s ability to continue as a going concern
opinions on matters prescribed by  
the companies act 2006
in our opinion the information given in the strategic report 
and the directors’ report for the financial year for which 
the group financial statements are prepared is consistent 
with the group financial statements
other matters on which we are required  
to report by exception
adequacy of information and explanations received
under the companies act 2006 we are required to  
report to you if in our opinion we have not received all the 
information and explanations we require for our audit we 
have no exceptions to report arising from this responsibility
directors’ remuneration
under the companies act 2006 we are required to  
report if in our opinion certain disclosures of directors’ 
remuneration specified by law have not been made  
and under the listing rules we are required to review 
certain elements of the report to shareholders by the 
board on directors’ remuneration we have no exceptions 
to report arising from these responsibilities
corporate governance statement
under the listing rules we are required to review the  
part of the corporate governance statement relating to 
the parent company’s compliance with nine provisions  
of the uk corporate governance code ‘the code’  
we have nothing to report having performed our review
on page 26 of the annual report as required by  
the code provision c11 the directors state that  
they consider the annual report taken as a whole to  
be fair balanced and understandable and provides the 
information necessary for members to assess the group’s 
performance business model and strategy on page 46 
as required by c38 of the code the audit committee  
has set out the significant issues that it considered in 
relation to the financial statements and how they were 
addressed under isas uk  ireland we are required  
to report to you if in our opinion 83
stv annual report  accounts 2013
•  the statement given by the directors is materially 
inconsistent with our knowledge of the group acquired 
in the course of performing our audit  
•  the section of the annual report describing the work  
of the audit committee does not appropriately address 
matters communicated by us to the audit committee
we have no exceptions to report arising from  
this responsibility
other information in the annual report
under isas uk  ireland we are required to report to  
you if in our opinion information in the annual report is
•  materially inconsistent with the information in the audited 
group financial statements or
•  apparently materially incorrect based on or materially 
inconsistent with our knowledge of the group acquired 
in the course of performing our audit or
•  is otherwise misleading
we have no exceptions to report arising from  
this responsibility
responsibilities for the financial statements  
and the audit
our responsibilities and those of the directors 
as explained more fully in the directors’ responsibilities 
statement set out on page 26 the directors are 
responsible for the preparation of the group financial 
statements and for being satisfied that they give a true  
and fair view 
our responsibility is to audit and express an opinion on  
the group financial statements in accordance with 
applicable law and isas uk  ireland those standards 
require us to comply with the auditing practices board’s 
ethical standards for auditors 
this report including the opinions has been prepared  
for and only for the company’s members as a body in 
accordance with chapter 3 of part 16 of the companies 
act 2006 and for no other purpose we do not in giving 
these opinions accept or assume responsibility for any 
other purpose or to any other person to whom this report 
is shown or into whose hands it may come save where 
expressly agreed by our prior consent in writing
other matter 
we have reported separately on the parent company 
financial statements of stv group plc for the year ended 
31 december 2013 and on the information in the directors’ 
remuneration report that is described as having  
been audited 
kenneth wilson senior statutory auditor
for and on behalf of pricewaterhousecoopers llp 
chartered accountants and statutory auditors 
glasgow
12 march 2014 accounts
84  consolidated income statement 
year ended 31 december 2013
note
2013 
£m
restated 
note 2  
2012  
£m 
revenue 5 1121  1027 
net operating expenses 6 941 909
operating profit 180  118 
analysed as
operating profit before exceptional items 180  171 
 – exceptional items 8 –  53
operating profit after exceptional items 180  118 
finance income –  01 
finance costs – borrowings 9 28 41
 – ias 19 pension 9 09 14
 37 54
profit before tax 143  64 
tax charge 10 21 15
profit for the year 122  49 
earnings per share
basic 12 322p 130p
diluted 12 312p 125p
the notes on pages 88 to 111 are an integral part of these consolidated financial statements
consolidated statement of comprehensive income
year ended 31 december 2013
note
2013 
£m
restated 
note 2  
2012  
£m 
profit for the year 122  49 
other comprehensive income
items that will not be reclassified to profit or loss
remeasurement gains on defined benefit pension schemes 28 212  52 
deferred tax charge 22 49 19
other comprehensive income for the year net of tax 163  33 
total comprehensive income for the year 285  82  85
stv annual report  accounts 2013
accounts
consolidated balance sheet 
at 31 december 2013
note
2013 
£m
restated 
note 3 
2012  
£m 
noncurrent assets
goodwill 13 79  79 
other intangible assets 14 07  – 
property plant and equipment 15 67  82 
investments 16 09  06 
deferred tax asset 22 51  121 
retirement benefit asset 28 13  – 
 226  288 
current assets
inventories 17 176  185 
trade and other receivables 18 214  189 
cash and cash equivalents 19 88  39 
 478  413 
total assets 704 701
equity attributable to owners of the parent
ordinary shares 24 195  195 
share premium 24 1120  1120 
merger reserve 1734  1734 
other reserve 03  04 
accumulated losses 2976 3262
total equity 76  209
 
noncurrent liabilities
borrowings 21 –  442 
derivative financial instruments 30 –  02 
retirement benefit obligations 28 –  230 
provisions 23 08  11 
 08  685 
current liabilities
borrowings 21 445  50 
trade and other payables 20 169  170 
provisions 23 06  05 
 620  225 
total liabilities 628  910 
total equity and liabilities 704  701 
the notes on pages 88 to 111 are an integral part of these consolidated financial statements
the consolidated financial statements on pages 84 to 111 were approved by the board on 12 march 2014  
and were signed on its behalf by 
rob woodward george watt
chief executive chief financial officer  accounts
86  consolidated statement of changes in equity 
year ended 31 december 2013
equity attributable to owners of the parent
ordinary 
shares  
£m
share 
premium  
£m
merger 
reserve  
£m
other  
reserve 
£m
accumulated 
losses 
£m
total 
equity 
£m
balance at 1 january 2013 195  1120  1734  04  3262 209
profit for the year – – – –  122  122 
remeasurement gain – – – –  212  212 
deferred tax thereon – – – –  49 49
total comprehensive income for the year – – – –  285  285 
equitysettled sharebased payments – – –  01 01  – 
balance at 31 december 2013 195  1120  1734  03  2976 76 
balance at 1 january 2012 195  1120  1734  06  3352 297
profit for the year restated – – – –  49  49 
remeasurement gain restated – – – –  52  52 
deferred tax thereon restated – – – –  19 19
total comprehensive income for the year – – – –  82  82 
own shares awarded – – – –  06  06 
equitysettled sharebased payments – – –  02 02  – 
balance at 31 december 2012 195  1120  1734  04  3262 209 87
stv annual report  accounts 2013
accounts
consolidated statement of cash flows 
year ended 31 december 2013
note
2013 
£m
restated 
note 3  
2012 
£m
operating activities
cash generated by operations 25 183  119 
interest paid 25 22
pension deficit funding – recovery plan payment 42 43
net cash generated by operating activities 116  54 
investing activities
interest received –  06 
loan note received –  50 
purchase of investment 03 01
capitalised web development spend 07 – 
purchase of property plant and equipment 07 10
net cash used ingenerated by investing activities  17 45 
financing activities
net borrowings repaid 50 65
net cash used by financing activities 50 65
net increase in cash and cash equivalents 49  34 
cash and cash equivalents at beginning of year 39  05 
cash and cash equivalents at end of year 25 88  39 
although not required under ifrs the directors have provided the following reconciliation of net debt for further clarity 
net debt represents group borrowings less cash and cash equivalents
reconciliation of movement in net debt
year ended 31 december 2013
note
2013 
£m
2012 
£m
opening net debt 453 545
net increase in cash and cash equivalents 49  34 
movement in debt financing 47  58 
closing net debt 25 357 453 accounts
88 notes to the financial statements
accounts
88  notes to the financial statements 
for the year ended 31 december 2013
1 general information
 stv group plc “the company” and its subsidiaries together “the group” is listed on the london stock 
exchange and incorporated and domiciled in the uk the address of the registered office is pacific quay  
glasgow g51 1pq the principal activities of the group are the production and broadcasting of television 
programmes internet services and the sale of advertising airtime and space in these media
2 adoption of new and revised standards
 the following new standards amendments to standards or interpretations are mandatory for the first time  
for accounting periods beginning on or after 1 january 2013
ias 1  amendments to financial statement presentation
ias 19 revised amend the accounting for employee benefits
ifrs 13  fair value measurement
 ifrs 13 and ias 1 were either not relevant for the group or had no material impact on the financial statements of 
the group
 amendment to ias 36 “impairment of assets” relates to the recoverable amount disclosures for nonfinancial 
assets and removes certain disclosures of the recoverable amount of cgus which had been included in ias 36  
by the issue of ifrs 13 the amendment is effective for accounting periods beginning on or after 1 january 2014 
but has been early adopted by the group
 there are no ifrs or ifric interpretations which are not yet effective that would have a material impact  
on the group          
 ias 19 amends the accounting for employee benefits the group has applied the standard retrospectively  
in accordance with the transition provisions of the standard the impact on the group has been in the  
following areas
  the standard replaces the interest cost on the defined benefit obligation and the expected return on plan 
assets with a net interest cost based on the net defined benefit asset or liability and the discount rate 
measured at the beginning of the year there is no change to determining the discount rate this continues  
to reflect the yield on high quality corporate bonds this has changed the income statement interest from  
a credit to a charge as the discount rate applied to assets is lower than the expected return on assets  
this has no effect on comprehensive income as the increased charge in profit is offset by a credit in other 
comprehensive income the effect has been that the income statement profit for the year to 31 december 
2012 has decreased by £20m the basic eps has decreased by 53p to 130p and the diluted eps has 
decreased by 51p to 125p 
  there is a new term “remeasurements” this is made up of actuarial gains and losses the difference between 
actual investment returns and the return implied by the net interest cost
 the change in accounting policy had no impact on the statement of cash flows
3 significant accounting policies
 the principal accounting policies applied in the preparation of these consolidated financial statements are set  
out below these policies have been consistently applied to all the years presented unless otherwise stated
basis of preparation
 the consolidated financial statements have been prepared in accordance with ifrs and ifrs interpretations 
committee ifrs ic interpretations as adopted by the european union eu and with those parts of the 
companies act 2006 applicable to companies reporting under ifrs  89
stv annual report  accounts 2013
 the consolidated financial statements have been prepared under the historical cost convention and on a going 
concern basis
remeasurement          
 investments at 1 january 2013 have been restated to include an amount of £06m previously held within trade and 
other receivables the effect on the cash flow has been to increase cash generated by operations by £01m and 
decrease cash generated by investing activities by £01m       
 in adopting the going concern basis for preparing the financial statements the directors have continued to review 
forecasts to determine the impact of both the shortterm and longterm liquidity position after making appropriate 
enquiries and taking into account the extension of the banking facility in february 2014 the directors have a reasonable 
expectation that the group has adequate resources to continue in operational existence for the foreseeable future 
for this reason the group continues to adopt the going concern basis in preparing its financial statements
 
 the preparation of financial statements in conformity with ifrs requires the use of certain critical accounting 
estimates it also requires management to exercise its judgement in the process of applying the group’s 
accounting policies the areas involving a higher degree of judgement or complexity or areas where assumptions 
and estimates are significant to the consolidated financial statements are disclosed in note 4
consolidation
 the financial statements comprise a consolidation of the financial statements of the company and all its 
subsidiaries up to 31 december each year subsidiaries include all entities over which the group has the power  
to govern the financial and operating policies subsidiaries are fully consolidated from the date on which the  
group has the power to control and deconsolidated from the date that control ceases on consolidation 
intercompany transactions balances and unrealised gains on transactions between group companies are 
eliminated where necessary adjustments are made to the financial statements of subsidiaries to bring the 
accounting policies used in line with those used by the group on consolidation
revenue recognition
 revenue is measured at the fair value of the consideration received or receivable and represents amounts 
receivable for goods and services provided in the normal course of business net of discounts and vat  
revenue from the sale of goods is recognised when the group has transferred the significant risks and rewards  
of ownership and control of the goods sold and the amount of revenue can be measured reliably key classes  
of revenue are recognised on the following basis
airtime revenue on transmission
sponsorship evenly over the life of the contract
programme production on delivery
 revenue on barter transactions is recognised only when the goods or services being exchanged are of  
a dissimilar nature
exceptional items
 exceptional items as disclosed on the face of the income statement are items which due to their material and 
nonrecurring nature have been classified separately in order to draw them to the attention of the reader of the 
accounts and to show the underlying results of the group
dividends
 final dividends are recorded in the financial statements in the period in which they are approved by the company’s 
shareholders interim dividends are recorded in the period in which they are approved and paid
pensions
 for defined benefit pension schemes the difference between the fair value of the assets and the present value  
of the defined benefit obligation is recognised as an asset or liability in the balance sheet the defined benefit 
obligation is actuarially calculated using the projected unit credit method accounts
90  notes to the financial statements 
continued
the defined benefit cost is made up of three categories
  the service cost of providing retirement benefits to employees during the year together with the cost of any 
benefits relating to past service is charged to operating profit in the year
 the net interest expense or income is recognised within finance costs net interest expense includes a credit 
representing the expected return on the assets of the retirement benefit schemes and a charge representing  
the expected increase in the liabilities of the retirement benefit schemes during the year
actuarial gains and losses are recognised immediately in the statement of comprehensive income
payments to defined contribution retirement benefit schemes are charged as an expense as they fall due
intangible assets
goodwill
 goodwill arising on consolidation represents the excess of the consideration transferred and the amount of  
any noncontrolling interest in the acquiree over the fair value of the identifiable assets and liabilities including 
intangible assets of the acquired entity at the date of acquisition goodwill is recognised as an asset and 
assessed for impairment annually or more frequently as triggering events occur any impairment is recognised 
immediately in the income statement
 goodwill arising on acquisitions before the date of transition to ifrs has been retained at the previous uk gaap 
amounts subject to being tested for impairment goodwill written off to reserves under uk gaap prior to 1998  
has not been restated and is not included in determining any subsequent profit or loss on disposal
other intangible assets
 other intangible assets are held at cost less accumulated amortisation and any provision for impairment included 
within intangible assets are assets in the course of construction which comprise primarily web development 
projects including directly attributable costs to bring the assets into use and may include capitalised borrowing 
costs amortisation is provided at the following rates per annum to write off the costs of other intangible assets 
less residual value on a straight line basis from the date on which they are brought into use
internally generated software between 10 and 25
property plant and equipment
 the group’s policy is to state property plant and equipment at cost less accumulated depreciation and any 
recognised impairment loss cost includes the original purchase price of the asset and the costs attributable  
to bringing the asset to its working condition for its intended use
 depreciation is provided to write off the cost of tangible noncurrent assets less estimated residual values  
by equal annual instalments as follows
leasehold buildings between 5 and 10
plant technical equipment and other between 10 and 20
 residual values and useful economic lives are reviewed annually depreciation is charged on all additions to  
or disposals of depreciating assets in the year of purchase or disposal
any impairment in value is charged to the income statement 91
stv annual report  accounts 2013
impairment
 assets that have an indefinite useful life are not subject to amortisation and are tested at least annually or 
whenever there is an indicator of impairment assets that are subject to amortisation or depreciation are reviewed 
for impairment whenever events or changes in circumstances indicate that the carrying amount may not be 
recoverable an impairment loss is recognised in the income statement for the amount by which the asset’s 
carrying value exceeds its recoverable amount for the purposes of assessing impairment assets are grouped  
at the lowest levels for which there are separately identifiable cash flows cashgenerating units
 the recoverable amount is the higher of an asset’s fair value less costs to sell and valueinuse in assessing value 
in use the estimated future cash flows are discounted to their present value using a discount rate that reflects 
current market assessments of the time value of money and the risks specific to the asset
leasing
 where assets are financed by leasing agreements and the risks and rewards are substantially transferred to  
the group finance leases the assets are treated as if they had been purchased outright and the corresponding 
liability to the leasing company is included as an obligation under finance leases depreciation on leased assets  
is charged to the income statement on the same basis as owned assets leasing payments are treated as 
consisting of capital and interest elements and the interest is charged to the income statement
 all other leases are operating leases and the costs in respect of operating leases are charged on a straightline 
basis over the lease term the value of any lease incentive received to take on an operating lease for example  
a rent free period is recognised as deferred income and is released over the life of the lease
inventories
 inventories are stated at the lower of cost or net realisable value cost comprises direct materials and where 
applicable direct labour costs and those overheads that have been incurred in bringing the inventories to their 
present location and condition net realisable value represents the estimated selling price less estimated costs  
of completion and the estimated selling costs        
  
recorded programmes and films
 recorded programmes are valued at direct cost including labour and overheads less appropriate provisions  
and are written off after the first transmission or sale programming made for third parties is valued at cost  
less appropriate provisions and is charged to the income statement against related income
the carrying value of inventory is assessed each year at the balance sheet date
provisions
 provisions are recognised when the group has a present obligation as a result of past events it is probable  
that the group will be required to settle that obligation and a reliable estimate can be made of the amount of  
the obligation provisions are measured at management’s best estimate of the expenditure required to settle  
the obligation at the balance sheet date
onerous contracts
 provisions for onerous contracts are recognised when the group has a detailed forecast of future losses  
from the contract
sharebased payments
 the group issues equitysettled sharebased payments to certain employees equitysettled sharebased 
payments are measured at fair value of the equity instruments at the grant date the fair value excludes the  
effect of non marketbased vesting conditions
  accounts
92  notes to the financial statements 
continued
 the fair value determined at the grant date of the equitysettled sharebased payments is expensed on a straight
line basis over the vesting period based on the group’s estimate of equity instruments that will eventually vest  
at each balance sheet date the group revises its estimate of the number of equity instruments expected to vest 
as a result of the effect of non marketbased vesting conditions the impact of the revision of the original 
estimates if any is recognised in profit and loss such that the cumulative expense reflects the revised estimate 
with a corresponding adjustment to the equitysettled employee benefits reserve
 fair value is measured by use of the black  scholes model or monte carlo model as relevant the expected lives 
used in the model have been adjusted based on management’s best estimate for the effects of non
transferability exercise restrictions and behavioural considerations
foreign currencies
 transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing on the dates 
of the transactions monetary assets and liabilities denominated in foreign currencies at the balance sheet date are 
reported at the rates of exchange prevailing at that date
taxation
 taxation expense comprises current and deferred tax tax is recognised in the income statement except to the 
extent it relates to items recognised in other comprehensive income or directly in equity in which case the related 
tax is also recognised in other comprehensive income or directly in equity
  current tax is based on taxable profits for the financial period using tax rates that are in force during the period 
taxable profit differs from net profit as reported in the income statement because it excludes items of income or 
expense that are taxable or deductible in other financial years and it further excludes items that are never taxable 
or deductible
 deferred tax is the tax expected to be payable or recoverable on temporary differences between the carrying 
amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the 
computation of taxable profit and is accounted for using the balance sheet liability method deferred tax is 
calculated using tax rates that have been enacted or substantially enacted at the balance sheet date and are 
expected to apply when the related deferred income tax asset is realised or the deferred tax liability settled
 deferred tax liabilities are generally recognised for all taxable temporary differences  deferred tax liabilities are 
recognised for taxable temporary differences arising on investments in subsidiaries except where the reversal of 
the temporary difference can be controlled by the group and it is probable that the difference will not reverse in 
the foreseeable future
 deferred tax assets are recognised to the extent it is probable that taxable profits will be available against which 
the deductible temporary differences can be utilised the carrying amount of deferred tax assets is reviewed at 
each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will 
be available to allow all or part of the asset to be recovered
 deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax 
assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income 
taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there  
is an intention to settle the balances on a net basis
financial instruments
 financial assets and financial liabilities are recognised in the group’s balance sheet when the group becomes  
a party to the contractual provisions of the instrument 93
stv annual report  accounts 2013
trade receivables
 trade receivables do not carry any interest and are stated at their nominal value as reduced by appropriate 
allowances for estimated irrecoverable amounts a provision is established for trade receivables if there is  
objective evidence that the group will not be able to collect all amounts due according to the original terms  
of the receivables
investments
investments are measured at reporting dates at fair value
cash and cash equivalents
 cash and cash equivalents comprise cash on hand and demand deposits and other shortterm highly liquid 
investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of 
changes in value
bank borrowings
 interestbearing bank loans and overdrafts are initially recorded at fair value being the proceeds received net of 
direct issue costs they are subsequently measured at amortised cost using the effective interest rate finance 
costs including premiums payable on settlement or redemption and direct issue costs are accounted for on an 
accruals basis to the income statement and are added to the carrying amount of the instrument to the extent that 
they are not settled in the period in which they arise 
trade payables
 trade payables are recognised initially at fair value and subsequently measured at amortised cost using the 
effective interest method          
equity instruments
equity instruments issued by the company are recorded at the proceeds received net of direct issue costs 
derivative financial instruments and hedge accounting
 the group uses derivative financial instruments to hedge its exposure to fluctuations in interest instruments 
accounted for as hedges are designated as a hedge at the inception of contracts
 in order to qualify for hedge accounting the group is required to document in advance the relationship between 
the item being hedged and the hedging instrument the group is also required to document and demonstrate an 
assessment of the relationship between the hedged item and the hedging instrument which shows that the hedge 
will be highly effective on an ongoing basis this effectiveness testing is reperformed at the end of each quarter 
end to ensure that the hedge remains highly effective
 the fair value of interest rate swaps is based on the market price libor of comparable instruments at the 
measurement date
 the fair value of the interest rate swap contracts are calculated on a discounted cash flow basis using market 
forward rates gains or losses arising from the movement to fair value are taken to the income statement accounts
94  notes to the financial statements 
continued
4 critical accounting estimates and judgements
 in the application of the group’s accounting policies which are described in note 3 management are required to 
make judgements estimates and assumptions about the carrying amounts of assets and liabilities that are not 
readily apparent from other sources the estimates and judgements are continually evaluated and are based on 
historical experience and other factors including expectations of future events that are believed to be reasonable 
under the circumstances actual results may differ from these estimates
 the key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet 
date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities 
within the next financial year are discussed below
impairment of goodwill
 determining whether goodwill is impaired requires an estimation of the valueinuse of the cashgenerating units to 
which the goodwill has been allocated the valueinuse calculation requires the entity to estimate the future cash 
flows expected to arise from the cashgenerating unit and a suitable discount rate in order to calculate the present 
value details of the impairment testing are set out in note 13
pension benefits
 the present value of the pension obligations depends on a number of factors that are determined on an actuarial 
basis using a number of assumptions the assumptions used in determining the net cost income for pensions 
include the discount rate any changes in these assumptions will impact the carrying amount of pension 
obligations
 the group determines the appropriate discount rate at the end of each year this is the interest rate that should  
be used to determine the present value of estimated future cash outflows expected to be required to settle  
the pension obligations in determining the appropriate discount rate the group considers the interest rates  
of highquality corporate bonds that are denominated in the currency in which the benefits will be paid and  
that have terms to maturity approximating the terms of the related pension liability
 other key assumptions for pension obligations are based in part on current market conditions additional 
information is disclosed in note 28
inventory
deferred production stock forms part of inventory and is stated in the accounts at the lower of cost or net 
realisable value programme costs are expensed in line with expected future revenues a detailed forecast  
of future sales is prepared by management based on historic experience and expected future trends
5 business segments
 the group’s chief executive the chief operating decision maker considers the business primarily from  
a product perspective under ifrs 8 the reportable segments are therefore consumer and productions
 the performance of the segments is assessed based on a measure of adjusted operating profit  
this measurement basis excludes the effects of exceptional items
           external sales
segment revenues
2013 
£m
2012 
£m
consumer 986 925
productions 135 102
1121 1027
revenue in 2013 includes £12m of revenues from sources outside the uk 2012 £11m 95
stv annual report  accounts 2013
segment result
2013 
£m
restated  
2012  
£m
consumer 176 169
productions 04 02
180 171
affiliate status change – 53
operating profit 180 118
financing 37 54
profit before tax 143 64
tax charge 21 15
profit attributable to owners of the parent 122 49
operating profit in 2013 includes £06m arising outside the uk 2012 £06m
in 2012 the £53m exceptional charge relates to consumer and is in relation to the group’s itv network affiliate status
           assets             liabilities
segment assets and liabilities
2013 
£m
2012 
£m
2013 
£m
 
2012 
£m
consumer 222  278  117  121 
productions 374  318  35  27 
total of all segments 596  596  152  148 
unallocated corporate 108  105  476  762 
consolidated 704  701  628  910 
other segment information            consumer            productions
2013 
£m
2012 
£m
2013 
£m
2012 
£m
capital additions 14 12 – –
depreciation 21 24 – –
 segment assets consist primarily of goodwill property plant and equipment inventories and trade and other 
receivables and cash and bank deposits
 segment liabilities comprise operating liabilities including trade and other payables and provisions they exclude 
group borrowings retirement benefit obligations tax liabilities and other noncurrent liabilities
all the net assets in 2012 and 2013 were held in the uk and therefore operate in a single geographical segment accounts
96  notes to the financial statements 
continued
6 operating expenses by nature
2013 
£m
 restated 
2012 
£m
programming costs 547 545
staff costs 212 215
other external charges 141 51
depreciation 21 24
operating lease charges 19 20
other operating charges 01 01
941 856
exceptional affiliate status change – 53
941 909
services provided by the group’s auditor
during the year the group obtained the following services from the company’s auditor
2013  
£000
2012  
£000
group
fees payable to company auditor for the audit of parent company and consolidated 
financial statements 75 95
fees payable to the company’s auditor and its associates for other services
– the audit of company’s subsidiaries pursuant to legislation 15 15
– auditrelated assurance services 25 25
– tax advisory services 110 77
– tax compliance services 91 93
– other services 68 53
384 358
included in the audit fees payable is £5000 2012 £5000 paid in respect of the parent company
other services comprise employee benefit advisory services
fees in respect of stv group plc pension schemes
2013  
£000
2012  
£000
audit 20 21 97
stv annual report  accounts 2013
7 staff
the average monthly number of employees including executive directors was
2013 
number
2012 
number
consumer and productions
established 372  343 
contract 24  33
396  376
contract staff numbers consist of employees on fixedterm contracts
their aggregate remuneration comprised
2013  
£m
restated 
2012  
£m
wages and salaries 165  161 
social security costs 16  15
other pension costs see note 28 31  39
212  215
 included within the retirement obligation above is a £22m pension cost 2012 £25m and £09m interest  
2012 £14m the interest element is included within finance costs on the face of the income statement
 2012 aggregate remuneration has been restated by £55m to include news staff costs previously included  
in programming
details of directors’ remuneration is provided in the remuneration report on pages 54 to 78
8 exceptional items
affiliate status change
 a noncash stock writedown of £41m was booked in 2012 relating to the group’s itv network affiliate status  
in addition legal and other costs of £12m in relation to this were incurred
9 finance costs
2013  
£m
restated 
2012  
£m
bank borrowings 28  39 
fair value loss on interest rate swaps –  02
 28  41 
pension finance charge 09  14 
37  55  accounts
98  notes to the financial statements 
continued
10 tax charge
2013  
£m
restated 
2012  
£m
corporation tax
current year –  –
adjustment in respect of prior years –  – 
 –  – 
deferred tax see note 22 21  15 
tax charge for the year 21  15 
the charge for the year can be reconciled to the profit per the income statement as follows
2013  
£m
restated 
2012  
£m
profit before tax 143  64
tax at the uk corporation tax rate of 2325 2012 245 33  16
tax effects of
other expenses not deductible for tax purposes 02  08 
movement in tax losses and other temporary differences 01 12
impact of changes in tax rates 04  04
adjustments in respect of prior years 17 01
tax charge for the year 21  15
11 dividends
2013  
£m
2012  
£m
proposed final dividend for the year ended 31 december 2013 of 20p 2012 nil per share 08  –
 the proposed final dividend is subject to approval by shareholders at the annual general meeting  
and has not been included as a liability in these financial statements 99
stv annual report  accounts 2013
12 earnings per share
 basic earnings per share “eps” is calculated by dividing the profit attributable to equity shareholders by the 
weighted average number of ordinary shares in issue during the period excluding ordinary shares purchased  
by the company and held as treasury shares
 in order to calculate diluted eps the weighted average number of ordinary shares in issue is adjusted to assume 
conversion of all dilutive potential ordinary shares the company has one type of dilutive potential ordinary shares 
namely share options granted to employees
 eps has been presented below both including and excluding exceptional items in order to provide a fuller 
understanding of the group’s underlying performance
earnings 
£m
2013 
weighted 
average 
number of 
shares m
per share 
pence 
restated 
earnings  
£m
2012 
weighted 
average 
number of 
shares m
restated  
per share 
pence
eps preexceptional items
earnings attributable to ordinary shareholders  122  378 322p 102  377 271p
basic eps  122  378 322p 102  377 271p
potential dilutive ordinary shares 13  14 
diluted eps 122  391 312p 102  391 261p
eps including exceptional items
earnings attributable to ordinary 
shareholders including exceptional items 122  378 322p 49  377 130p
basic eps 122  378 322p 49  377 130p
potential dilutive ordinary shares 13  14
diluted eps 122  391 312p 49  391 125p accounts
100  notes to the financial statements 
continued
13 goodwill
 goodwill at 1 january and 31 december 2013 was £79m 2012 £79m it comprises capitalised goodwill  
on acquisitions completed since 1 january 1998 and the cost and impairment provision is split £106m and  
£27m respectively
 the group tests goodwill annually for impairment or more frequently if there are indications that goodwill might  
be impaired
 goodwill is allocated to the group’s cashgenerating units cgus identified according to operating segment  
all goodwill recognised at the year end and previous year end relates to productions
 the recoverable amount of a cgu is determined based on valueinuse calculations the key assumptions used 
for valueinuse calculations are as follows
growth rate longterm 2
discount rate  14
  these calculations use pretax cash flow projections based on financial budgets approved by management 
covering a three year period cash flows beyond the three year period are extrapolated using an estimated growth 
rate of 2 the growth rate is not considered to exceed the longterm average growth rate for the media business 
in which the cgu operates
 the group has conducted a sensitivity analysis on the impairment test of the cgu’s carrying value a change in 
the discount rate to 20 would result in the carrying value of goodwill being reduced to its recoverable amount
 management determined net cash flow based on past performance and its expectations of market development 
no impairment charge is considered to have arisen this year
14 other intangible assets
web 
development 
£m
cost
at 1 january 2012 and 2013  –
additions 07
at 31 december 2013 07
accumulated depreciation and impairment
at 1 january and 31 december 2013 –
net book value at 31 december 2013 07
net book value at 31 december 2012 – 101
stv annual report  accounts 2013
15 property plant and equipment
leasehold  
buildings  
£m
plant  
technical  
equipment  
and other  
£m
total  
£m
cost
at 1 january 2012 02  253  255 
additions –  12  12 
disposals –  03 03
at 1 january 2013 02  262  264 
additions –  07  07 
write offs 01 21 22
at 31 december 2013 01  248  249 
accumulated depreciation and impairment
at 1 january 2012 01  159  160 
charge for year – 24  24 
disposals – 02 02
at 1 january 2013 01  181  182 
charge for year –  21  21 
write offs –  21 21
at 31 december 2013 01  181  182 
net book value at 31 december 2013 –  67  67 
net book value at 31 december 2012 01  81  82
16 investments
£m
costvaluation
at 1 january 2013 – 
adjustment see below 06
at 1 january 2013 restated 06
additions 03
at 31 december 2013 09
 investments at 1 january 2013 have been restated to include an amount of £06m previously held within trade  
and other receivables
17 inventories
2013  
£m
2012  
£m
recorded programmes and films 176  185 accounts
10 2   notes to the financial statements 
continued
18 trade and other receivables 
2013  
£m
2012  
£m
trade receivables 109  104
less provision for impairment of receivables –  01
trade receivables – net 109  103
prepayments and accrued income 100  82
other receivables 05  10
 214  195
 as of 31 december 2013 trade receivables of £08m 2012 £08m are past due these are net of a provision for 
bad debts of £nil 2012 £01m trade receivables relate to a number of independent customers for whom there  
is no recent history of default
the ageing analysis of the trade receivables is as follows
gross  
£m
2013 
provision  
£m
gross  
£m
2012 
provision  
£m
up to 3 months 109  –  102  – 
3 to 5 months –  –  01  01
 109  –  103  01
 the directors consider that the carrying amount of trade and other receivables approximates their fair value  
all receivables are expected to be recovered
19 cash and cash equivalents
2013  
£m
2012  
£m
cash and cash equivalents 88  39
20 trade and other payables
2013  
£m
2012  
£m
current
trade payables  28  48
accrued expenses 104  88
social security and other taxes 35  32
other payables 02  02
169  170
noncurrent
derivative financial instruments note 30 –  02
–  02
the directors consider that the carrying amount of trade and other payables approximates their fair value 103
stv annual report  accounts 2013
21 borrowings
2013  
£m
2012  
£m
bank loans 445  492
the borrowings are repayable as follows
expiring within 1 year 445  50
expiring in 2 to 5 years –  442
all undrawn committed borrowing facilities are repayable within one year 2012 within two 
to four years
the effective interest rates were as follows
2013 

2012 

bank loans floating 41  51
 at 31 december 2013 the company had bank facilities in place totalling £575m consisting of a £250m  
term facility and a £325m revolving credit and overdraft facility 2012 £300m and £325m respectively  
at 31 december 2013 £125m 2012 £125m of the £575m 2012 £625m bank facility in place at that  
date remains undrawn
 the facilities were due to expire on 31 december 2014 and consequently the borrowings have all been  
classified as current liabilities as at 31 december 2013 subsequent to the balance sheet date the renewal of  
the channel 3 broadcast licences in february 2014 resulted in the facilities being extended to 31 march 2016
 the term loan partially amortises across the facility term and £50m was amortised on 31 december 2013 
security is provided to the debt providers by way of cross guarantees and a share pledge
 the effect of the group’s interest rate swaps is to classify £240m 2012 £300m of borrowings as fixed  
rate the notional principal amount of the outstanding interest rate swap contracts at 31 december 2013  
was £240m 2012 £300m a fair value on the interest rate swaps of £nil 2012 £02m has been recognised  
at 31 december 2013
the fair value of current borrowings equals their carrying amount as the impact of discounting is not significant accounts
10 4   notes to the financial statements 
continued
22 deferred tax
the analysis of the current deferred tax balances is as follows
2013  
£m
2012  
£m
deferred tax asset 
deferred tax to be recovered after more than one year  37 86
deferred tax to be recovered within one year  14 35
 51 121
net deferred tax asset  51 121
deferred tax asset not recognised 91 119
 a deferred tax asset has been recognised in respect of these temporary differences as it is probable that the 
group will generate sufficient taxable profits in the future against which these temporary differences can be offset
 the deferred tax asset of £91m 2012 £119m which has not been recognised relates to a combination of trading 
tax losses and nontrade debits
 the movement in deferred tax assets and liabilities during the year taking into consideration the offsetting  
of balances within the same tax jurisdiction is as follows 
tax  
trading  
losses 
£m
other  
temporary  
differences  
£m
accelerated  
tax  
depreciation  
£m
retirement  
benefit  
obligations  
£m
total  
£m
at 1 january 2013  28 04 36 53 121
chargecredit to income  05 01  19  06  21 
charge to equity –  –  –  49  49 
at 31 december 2013  33 03 17 02  51
 during the year a change in the uk corporation tax rate from 24 to 23 effective from 1 april 2013  
was substantively enacted in march 2013
    
 in addition a number of further changes to the uk corporation tax system were announced in the march 2013 uk 
budget statement legislation to reduce the main rate of corporation tax from 23 to 21 from 1 april 2014 and 
to 20 from 1 april 2015 was included in the finance act 2013 which was enacted in july 2013  the closing 
deferred tax balances have therefore been remeasured accordingly    105
stv annual report  accounts 2013
23 provisions
onerous lease provisions
2013  
£m
2012  
£m
at 1 january  16  30
provided during the year  05 –
utilised during the year  07 14
at 31 december  14  16 
the provisions are expected to be utilised
onerous lease provisions
2013  
£m
2012  
£m
within one year  06  05 
greater than one year  08  11 
14  16 
24 share capital and premium
number  
of shares  
thousands
ordinary  
shares  
£m
share  
premium  
£m
 total  
£m
at 1 january and 31 december 2013 39050 195  1120  1315 
 the total authorised number of ordinary shares is 63 million shares 2012 63 million shares with a par value  
of £050 per share 2012 £050 per share all issued shares are fully paid
 on 14 february 2014 the court of session granted a reduction in the share premium account of £110m accounts
10 6   notes to the financial statements 
continued
25 notes to the consolidated statement of cash flows
2013  
£m
restated 
2012  
£m
operating profit before exceptional items  180  171
depreciation  21  24
201  195
decrease in inventories  09  65 
increase in trade and other receivables  25 12
decrease in trade and other payables  02 66
underlying cash generated by operations  183  182 
litigation matters  –  51
costs of change and onerous property costs  –  12
cash generated by operations  183  119 
analysis of movements in net debt
at 1  
january  
2013  
£m
cash  
flow  
£m
noncash 
movements 
£m
 at 31 
december 
2013  
£m
cash and cash equivalents note 19  39  49 – 88
bank borrowings note 21  492 50  03 445
net debt  453 99  03 357
26 operating lease commitments
 at 31 december 2013 the group had minimum commitments in respect of noncancellable operating leases for 
leasehold buildings payable as follows
2013 
£m
2012  
£m
within one year 16 15
between two and five years 67 65
after five years 93 108
176 188
27  transactions with related parties
 during the year £13000 2012 £8000 income was received from related parties and a balance of £3500  
was owed by related parties at 31 december 2013 31 december 2012 £2000 these amounts relate to fees 
received from group investment companies
 key management personnel are deemed to be the executive and nonexecutive directors of the group  
as they have authority and responsibility for controlling the group’s activities
key management remuneration is detailed as follows
2013 
£m
2012  
£m
shortterm employee benefits 13  13
 see remuneration report pages 6768 for details
there have been no other transactions with key management personnel as defined under ias 24 107
stv annual report  accounts 2013
28 retirement benefit schemes
defined contribution schemes
 the group operates two money purchase schemes the stv pension scheme and the pearl  dean cinemas 
pension scheme for which the pension cost charge for the year amounted to £07m 2012 £07m
defined benefit schemes
 the group operates two defined benefit pension schemes the schemes are trustee administered and the 
schemes’ assets are held independently of the group’s finances pension costs are assessed in accordance  
with the advice of an independent professionally qualified actuary 
 the schemes are the scottish and grampian television retirement benefit scheme and the caledonian publishing 
pension scheme they are closed schemes and therefore under the projected unit method the current service 
cost will increase as the members of the scheme approach retirement
  a full actuarial valuation of the schemes was carried out at 1 january 2009 and updated to 31 december 2013  
by a qualified independent actuary the major assumptions used by the actuary were
key assumptions
2013 2012
rate of increase in salaries 100 100
rate of increase of pensions in payment 335 315
discount rate 455 435
rate of price inflation rpi 335 315
mortality assumptions
 assumptions regarding future mortality experience are set based on advice published statistics and experience in 
each scheme
the average life expectancy in years of a pensioner retiring at age 65 is as follows
2013  
years
2012  
years
retiring at balance sheet date
male 143 143
female 171 171
retiring in 20 years
male 166 166
female 195 195
 significant actuarial assumptions for the determination of the defined benefit obligation are discount rate expected 
salary increase and mortality the sensitivity analysis below has been determined based on reasonably possible 
changes of the assumptions occurring at the end of the reporting period assuming that all other assumptions are 
held constant
assumption change in assumption impact on scheme liabilities
discount rate increasedecrease by 025 decreaseincrease by 3
rate of price inflation rpi increasedecrease by 025 increasedecrease by 1
rate of mortality decrease by 1 year increase by 3 accounts
108  notes to the financial statements 
continued
28 retirement benefit schemes continued
amounts recognised in the income statement in respect of these defined benefit schemes is as follows
2013  
£m
restated  
2012  
£m
current service cost – defined benefit 15 18
net interest expense 09 14
 24 32
 of the total charge £15m 2012 £18m has been included in operating expenses and £09m 2012 £14m  
has been included in finance costs see note 9
amounts recognised in the statement of comprehensive income are as follows
2013  
£m
restated  
2012  
£m
actuarial gains arising from changes in financial assumptions 212 52
the amounts recognised in the balance sheet were as follows
2013  
£m
2012  
£m
present value of defined benefit obligations 2957 3024
fair value of schemes’ assets 2970  2794 
surplusdeficit in the schemes 13  230
  a related offsetting deferred tax charge of £02m 2012 asset £53m is included under noncurrent assets 
therefore the net pension scheme surplus amounts to £11m at 31 december 2013 £177m deficit at  
31 december 2012
the movement in the defined benefit obligation over the year is as follows
2013  
£m
restated 
2012  
£m
at 1 january 3024  2950 
current service cost 03  04 
interest cost 128  142 
contributions from plan participants 01  01 
remeasurement gainslosses
actuarial gains and losses arising from changes in financial assumptions 42 90 
benefits paid from plan 157 163
at 31 december  2957  3024 109
stv annual report  accounts 2013
the movement in the fair value of the schemes’ assets during the year is as follows  
2013  
£m
restated 
2012  
£m
at 1 january 2794  2641
interest income 119  128
remeasurement gainloss
return on plan assets excluding interest income 170  142
contributions from the employer 55  59
managing plan asset costs 12 14
contributions from plan participants 01  01
benefits paid from plan 157 163
at 31 december  2970  2794 
  
plan assets comprised the following
2013  
£m 
2012  
£m 
equities 1505 51 1404 50
corporate bonds 831 28 780 28
government bonds and cash 634 21 610 22
2970 100 2794 100
29 sharebased payments
 the longterm incentive plan is for executive directors and other senior executives the performance criteria for 
this scheme are based on a combination of earnings growth and total shareholder return and as such have been 
valued using a monte carlo model
refer to the remuneration report on pages 54 to 78 for share based payments accounts
11 0   notes to the financial statements 
continued
30 financial instruments
capital risk management
 the group’s objectives when managing capital are to safeguard the group’s ability to continue as a going concern 
in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital 
structure to reduce the cost of capital
 the capital structure of the company consists of debt which includes the bank loans disclosed in note 21 cash 
and cash equivalents and equity attributable to equity holders of the parent comprising issued share capital 
reserves and retained earnings
the group monitors capital on the basis of the gearing ratio
gearing ratio
this ratio is calculated as net debt divided by total capital
2013  
£m
2012  
£m
total borrowings note 21 445  492 
cash and cash equivalents  88 39
net debt 357  453
total equity 76  209
total capital 433  244 
82 186
covenants
 the group is subject to two financial covenants in respect of its committed borrowing facilities at the balance 
sheet date the terms of the facility agreement contain the following covenants i the ratio of average net debt  
to adjusted earnings pre exceptional before interest tax depreciation and amortisation ebitda and ii the  
ratio of adjusted ebitda to cash interest both of which are tested quarterly the group complied with all the 
covenants in each of the test periods to the balance sheet date
derivative financial instruments
 the group’s policy is to minimise the exposure to interest rates by ensuring an appropriate balance of floating  
and fixed rates the group’s primary funding is at floating rates through its bank facilities in order to manage its 
associated interest rate risk the group uses interest rate swaps to vary the mix of fixed and floating rates interest 
rate swap contracts of £240m 2012 £300m were entered into on 7 february 2012 and expired in january 2014 
fair value is based on the market price of these instruments at the balance sheet date in accordance with ifrs 7 
the interest rate swaps are considered to be level 2 with the fair value being calculated at the present value of the 
estimated future cash flows using market interest rates as the interest rate swaps expired on 23 january 2014 
their fair value at 31 december 2013 is immaterial 2012 £02m
financial risk management objectives
 the group’s activities expose it to a variety of financial risks 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 the group’s financial performance the group 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 group’s operating divisions the board provides written 
principles for overall risk management as well as written policies covering specific areas such as currency risk 
interest rate risk credit risk use of financial instruments and investing excess liquidity 111
stv annual report  accounts 2013
currency risk
 the group operates almost wholly within the uk and is exposed to minimal currency risk the group’s borrowings 
are denominated in sterling which is also the group’s intrauk net currency flow currency risk arises primarily 
with respect to the euro and the us dollar and from future commercial transactions and trade assets and liabilities 
in foreign currencies no further active management of currency risk is required
 the group has minimal exposure to currency risk and it is group policy to ensure that all material payments  
or receipts are fully hedged at 31 december 2013 the group had no forward foreign currency contracts in  
place 2012 £nil
credit risk
 credit risk is the risk of losses due to the failure of the group’s customers to meet their payment obligations 
towards the group the group 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 independent credit ratings are sought for  
all potential customers and based on the outcome of the feedback from the ratings agency a judgement is made 
on the appropriate level of credit to be given borrowings cash and derivative transaction counterparties are 
limited to highcreditquality financial institutions
liquidity risk
liquidity risk is the risk that the group will be unable to meet its payment obligations 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
 management monitors rolling forecasts of the group’s liquidity reserve comprises of the undrawn borrowing 
facility note 21 and cash and cash equivalents note 19 on the basis of expected cash flow this is generally 
carried out at a group level in addition the group’s liquidity management policy includes projecting cash  
flows and considering the level of liquid assets necessary to meet these monitoring balance sheet liquidity  
ratios against internal targets and bank facility requirements and maintaining debt financing plans
cash flow interest rate risk
 as the group has no significant interest bearing assets the group’s income and operating cash flows are 
substantially independent of changes in market interest rates
 the group’s interest rate risk arises from longterm borrowings borrowings issued at shortterm floating rates 
expose the group to cash flow interest rate risk group policy is to maintain between 30 and 50 of its 
borrowings in fixed rate instruments
 a monthly sensitivity analysis is carried out and on the level of borrowings of the group at 31 december 2013 a 
movement of 025 in interest rates would change the level of interest paid in the year by  £01m 2012 £01m 
025 is considered a reasonably possible change
 the group manages its cash flow interest rate risk by using floatingtofixed interest rate swaps such interest rate 
swaps have the economic effect of converting borrowing from floating rates to fixed rates generally the group 
raises longterm borrowings at floating rates and swaps them into fixed rates that are lower than those available  
if the group borrowed at fixed rate directly under the interest rate swaps the group agrees with other parties  
to exchange at specific intervals mainly quarterly the difference between fixed contract rates and floating rate 
interest amounts calculated by reference to the agreed notional principal amounts an interest rate swap was 
entered into on 7 february 2012 and expired in january 2014 accounts
112  stv group plc company financial statements 
independent auditors’ report to the members of stv group plc
report on the parent company financial statements
our opinion
in our opinion the parent company financial statements 
defined below
•  give a true and fair view of the state of the parent 
company’s affairs as at 31 december 2013
•  have been properly prepared in accordance with united 
kingdom generally accepted accounting practice and
•  have been prepared in accordance with the 
requirements of the companies act 2006
this opinion is to be read in the context of what we say  
in the remainder of this report
what we have audited
the parent company financial statements which are 
prepared by stv group plc comprise
•  the parent company balance sheet as at  
31 december 2013 and
•  the notes to the parent company financial statements 
which include a summary of significant accounting 
policies and other explanatory information
the financial reporting framework that has been applied  
in their preparation comprises applicable law and united 
kingdom accounting standards united kingdom 
generally accepted accounting practice
in applying the financial reporting framework the directors 
have made a number of subjective judgements for 
example in respect of significant accounting estimates  
in making such estimates they have made assumptions 
and considered future events
what an audit of financial statements involves 
we conducted our audit in accordance with international 
standards on auditing uk  ireland “isas uk  
ireland” an audit involves obtaining evidence about  
the amounts and disclosures in the financial statements 
sufficient to give reasonable assurance that the financial 
statements are free from material misstatement whether 
caused by fraud or error this includes an assessment of
•  whether the accounting policies are appropriate to  
the parent company’s circumstances and have been 
consistently applied and adequately disclosed
•  the reasonableness of significant accounting estimates 
made by the directors and 
• the overall presentation of the financial statements 
in addition we read all the financial and nonfinancial 
information in the annual report and accounts the 
“annual report” to identify material inconsistencies with 
the audited parent company financial statements and  
to identify any information that is apparently materially 
incorrect based on or materially inconsistent with the 
knowledge acquired by us in the course of performing  
the audit if we become aware of any apparent material 
misstatements or inconsistencies we consider the 
implications for our report
opinions on other matters prescribed  
by the companies act 2006
in our opinion
•  the information given in the strategic report and  
the directors’ report for the financial year for which  
the parent company financial statements are  
prepared is consistent with the parent company 
financial statements
•  the part of the directors’ remuneration report to  
be audited has been properly prepared in accordance 
with the companies act 2006
other matters on which we are required  
to report by exception
adequacy of accounting records and information  
and explanations received
under the companies act 2006 we are required to report 
to you if in our opinion
•  we have not received all the information and 
explanations we require for our audit or
•  adequate accounting records have not been kept by  
the parent company or returns adequate for our audit 
have not been received from branches not visited  
by us or
•  the parent company financial statements and the part  
of the directors’ remuneration report to be audited  
are not in agreement with the accounting records  
and returns
we have no exceptions to report arising from  
this responsibility
directors’ remuneration
under the companies act 2006 we are required to  
report to you if in our opinion certain disclosures of 
directors’ remuneration specified by law have not been 
made we have no exceptions to report arising from  
this responsibility 113
stv annual report  accounts 2013
other information in the annual report
under isas uk  ireland we are required to report to  
you if in our opinion information in the annual report is
•  materially inconsistent with the information in the audited 
parent company financial statements or
•  apparently materially incorrect based on or materially 
inconsistent with our knowledge of the parent 
company acquired in the course of performing our 
audit or
• is otherwise misleading
we have no exceptions to report arising from this responsibility
responsibilities for the financial statements  
and the audit
our responsibilities and those of the directors 
as explained more fully in the directors’ responsibilities 
statement set out on page 26 the directors are 
responsible for the preparation of the parent company 
financial statements and for being satisfied that they  
give a true and fair view 
our responsibility is to audit and express an opinion on  
the parent company financial statements in accordance 
with applicable law and isas uk  ireland those 
standards require us to comply with the auditing practices 
board’s ethical standards for auditors 
this report including the opinions has been prepared  
for and only for the company’s members as a body in 
accordance with chapter 3 of part 16 of the companies 
act 2006 and for no other purpose we do not in giving 
these opinions accept or assume responsibility for any 
other purpose or to any other person to whom this report 
is shown or into whose hands it may come save where 
expressly agreed by our prior consent in writing
other matter
we have reported separately on the group financial 
statements of stv group plc for the year ended  
31 december 2013 
kenneth wilson senior statutory auditor
for and on behalf of pricewaterhousecoopers llp 
chartered accountants and statutory auditors 
glasgow
12 march 2014 accounts
11 4   company balance sheet 
at 31 december 2013
note
2013  
£m
restated 
2012  
£m
fixed assets
investments 2 282  279 
current assets
debtors
– due within one year 3 399  412 
– due after one year 3 1382  1268 
1781  1680 
creditors amounts falling due within one year 4 676 231
net current assets  1105 1449
total assets less current liabilities  1387  1728 
creditors amounts falling due after more than one year 4 –  444
net assets excluding pension liability  1387  1284 
pension liability  –  75
net assets including pension liability  1387  1209 
capital and reserves
called up share capital 6 195  195 
share premium account 6 1120  1120 
profit and loss account 6 69  110
other reserve 6 03  04 
shareholders’ funds  1387  1209 
the accompanying notes are an integral part of this balance sheet
 the company has elected to take the exemption under section 408 of the companies act 2006 to not present  
the parent company profit and loss account the profit for the parent company for the year was £105m 2012 £60m 
 the financial statements on pages 114 to 121 were approved by the board on 12 march 2014 and were signed  
on its behalf by
rob woodward  george watt
director   director 115
stv annual report  accounts 2013
2013 
£m
2012 
£m
profit for the financial year 105  60
actuarial gain –  20
deferred tax thereon –  07
total recognised gains in the year 105  73
accounts
statement of total recognised gains and losses 
for the year ended 31 december 2013 accounts
116  notes to the company financial statements 
for the year ended 31 december 2013
1 accounting policies
accounting convention and basis of preparation
 the separate financial statements of the company are presented as required by the companies act 2006  
the separate financial statements have been prepared in accordance with all applicable uk accounting standards 
and have been prepared consistently from year to year under the historical cost convention in accordance  
with applicable accounting standards on a going concern basis
basis of consolidation
 as permitted under section 408 of the companies act 2006 no separate profit and loss account for the holding 
company is presented the consolidated financial statements as presented within the annual report include the results 
of stv group plc the holding company and all of its subsidiaries and associated undertakings up to 31 december 2013
going concern
 the directors have at the time of approving the financial statements a reasonable expectation that the company 
and the group have adequate resources to continue in operational existence for the foreseeable future thus they 
continue to adopt the going concern basis of accounting in preparing the financial statements further detail is 
contained in the performance review on page 25
investments
 fixed asset investments are stated at cost less any provision for impairment
impairment
 assets that are subject to amortisation or depreciation are reviewed for impairment whenever events or changes  
in circumstances indicate that the carrying amount may not be recoverable an impairment loss is recognised in 
the profit and loss account for the amount by which the asset’s carrying value exceeds its recoverable amount  
  
sharebased payments
 the group issues equitysettled sharebased payments to certain employees equitysettled sharebased 
payments are measured at fair value of the equity instruments at the grant date the fair value excludes the effect 
of non marketbased vesting conditions
 the grant by the company of options over its equity instruments to the employees of subsidiary undertakings in 
the group is treated as a capital contribution the fair value of employee services received measured by reference 
to the grant date fair value is recognised over the vesting period as an increase to investment in subsidiary 
undertakings with a corresponding credit to equity
 the fair value determined at the grant date of the equitysettled sharebased payments is expensed on a straight
line basis over the vesting period based on the group’s estimate of equity instruments that will eventually vest  
at each balance sheet date the group revises its estimate of the number of equity instruments expected to vest 
as a result of the effect of non marketbased vesting conditions the impact of the revision of the original 
estimates if any is recognised in profit and loss such that the cumulative expense reflects the revised estimate 
with a corresponding adjustment to the equitysettled employee benefits reserve
 fair value is measured by use of the black  scholes model or monte carlo model as relevant the expected  
lives used in the model have been adjusted based on management’s best estimate for the effects of non
transferability exercise restrictions and behavioural considerations
full disclosure of sharebased payment awards is provided within the group financial statements 117
stv annual report  accounts 2013
dividends
 the liability for final dividends is recorded when the dividends are approved by the company’s shareholders  
for interim dividends the liability is recorded when the dividends are paid
taxation
 current tax is provided at amounts expected to be paid or recovered using the tax rates enacted or substantially 
enacted by the balance sheet date
 deferred taxation is provided in full on timing differences that result in an obligation at the balance sheet date to 
pay more tax or a right to pay less tax at a future date at rates expected to apply when they crystallise based  
on current tax rates and law timing differences arise from the inclusion of items of income and expenditure in  
tax computations in periods different from those in which they are included in the financial statements deferred 
tax assets and liabilities are not discounted
 the taxation liabilities of certain group companies are reduced wholly or in part by losses surrendered by other 
group companies the tax benefits arising from group relief are recognised in the accounts of the surrendering 
and recipient companies
bank borrowings 
 interestbearing bank loans and overdrafts are initially recorded at the proceeds received net of direct issue costs 
they are subsequently measured at amortised cost using the effective interest rate finance costs including 
premiums payable on settlement or redemption and direct issue costs are accounted for on an accruals basis  
to the profit and loss account and are added to the carrying amount of the instrument to the extent that they are 
not settled in the period in which they arise  accounts
118  notes to the company financial statements 
continued
2 investments
subsidiaries  
£m
other  
£m
total  
£m
at 1 january 2013 273 – 273
adjustment see below – 06 06
at 1 january 2013 restated 273 06 279
additions – 03 03
at 31 december 2013 273 09 282
provisions for impairment
at 1 january and 31 december 2013 –  –  – 
net book value at 31 december 2013 273 09 282
net book value at 31 december 2012 273 06 279
 investments at 1 january 2013 have been restated to include an amount of £06m previously held within trade  
and other receivables
subsidiary undertakings 
 the directors consider that to give full particulars of all subsidiary undertakings would lead to a statement  
of excessive length the following information relates to the subsidiary undertakings whose results or financial 
position in the opinion of the directors principally affect the results of the group
undertaking country of incorporation  
or registration and operation
principal activity
stv central limited scotland television broadcasting
stv north limited scotland television broadcasting
stv productions limited scotland programme production
solutionstv limited scotland television technical facilities
ginger television productions limited england programme production
the directors believe that the carrying value of the investments is supported by their underlying net assets 
 
 none of the above investments are held directly by stv group plc the investments are stated in the balance 
sheet at cost less amounts written off for impairment in value all shares are ordinary shares all of the above 
investments are 100 shareholdings within the group
 a full list of subsidiary undertakings is included in the annual return 119
stv annual report  accounts 2013
3 debtors
2013  
£m
restated 
2012  
£m
due within one year
amounts owed by group undertakings 370  406 
prepayments and accrued income 08  06 
deferred tax note 7 21  – 
 399  412 
due after one year
amounts owed by group undertakings 1382  1268
  included within amounts owed by group undertakings due after one year is a loan of £1000m to a subsidiary 
undertaking interest on the loan accrues at a rate of 9 and is payable from 1 april 2010 interest accrued  
is capitalised and added to the principal amount interest will also accrue on interest which is capitalised in  
this way the loan is repayable on 31 march 2020
 all remaining amounts owed by group undertakings are unsecured interest free and have no fixed date  
of repayment
2012 has been restated to adjust for the investment in mirriad limited now shown under investments
4 creditors
 
2013  
£m
2012  
£m
amounts falling due within one year
trade creditors and accruals 08  11 
bank loans 445  50 
amounts owed to subsidiary undertakings 223  170 
 676  231 
amounts falling due after more than one year 
bank loans –  442 
derivative financial instruments –  02 
 –  444
  
amounts owed to group undertakings are unsecured interest free and have no fixed date of repayment   accounts
120  notes to the company financial statements 
continued
5 bank loans
 
2013  
£m
2012  
£m
bank loans 445  492 
the borrowings are repayable as follows
expiring within 1 year 445  50
expiring in 2 to 5 years –  442 
445  492 
all undrawn committed borrowing facilities are repayable within one year 2012 within two to four years  
the effective interest rates were as follows
 
2013  

2012  

bank loans floating 41  51
 at 31 december 2013 the company had bank facilities in place totalling £575m consisting of a £250m term facility 
and a £325m revolving credit and overdraft facility 2012 £300m and £325m respectively at 31 december 2013 
£125m 2012 £125m of the £575m 2012 £625m bank facility in place at that date remains undrawn
 the facilities were due to expire on 31 december 2014 and consequently the borrowings have all been classified 
as current liabilities as at 31 december 2013 subsequent to the balance sheet date the renewal of the channel 3 
broadcast licences in february 2014 resulted in the facilities being extended to 31 march 2016
 the term loan partially amortises across the facility term and £50m was amortised on 31 december 2013 
security is provided to the debt providers by way of cross guarantees and a share pledge
derivative financial instruments
 the group manages its cash flow interest rate risk by using floatingfixed interest rate swaps interest rate swap 
contracts of £240m 2012 £300m were entered into on 7 february 2012 and expired in january 2014 fair value 
is based on the market price of these instruments at the balance sheet date in accordance with ifrs 7 the 
interest rate swaps are considered to be level 2 with the fair value being calculated at the present value of the 
estimated future cash flows using market interest rates as the interest rate swaps expired on 23 january 2014 
their fair value at 31 december 2013 is immaterial 2012 £02m 121
stv annual report  accounts 2013
6 reserves and movements in shareholders’ funds
called up 
share 
capital  
£m
share 
premium 
account  
£m
profit  
and loss 
account  
£m
other 
reserve  
£m
total  
£m
at 1 january 2012 195  1120  191 06  1130
profit for the year –  –  60  –  60
actuarial gain –  –  20  –  20
deferred tax thereon –  –  07 –  07
equitysettled sharebased payments –  –  02  02 –
own shares awarded –  –  06  –  06
at 1 january 2013 195  1120  110 04  1209
profit for the year – – 105 – 105
pension transferred to a fellow group undertaking – – 73 – 73
equitysettled sharebased payments – – 01  01 – 
at 31 december 2013 195  1120  69  03  1387
included within profit and loss reserves is an unrealised amount of £786m at 31 december 2013
the caledonian pension scheme was transferred during the year to stv television limited when it became 
sponsoring employer of the pension scheme as such details of the current and prior year pension commitments 
are disclosed in stv television limited’s accounts
on 20 february 2014 the court of session granted a reduction in the share premium account of £110m  
7 deferred taxation
 deferred taxation is provided as follows
tax
losses
£m
at 1 january 2013 –
provided in year 21
at 31 december 2013 21
deferred tax asset not recognised 20
refer to note 3 for the above deferred tax asset
 during the year a change in the uk corporation tax rate from 24 to 23 effective from 1 april 2013  
was substantially enacted in march 2013
 in addition a number of further changes to the uk corporation tax system were announced in the march 2013  
uk budget statement legislation to reduce the main rate of corporation tax from 23 to 21 from 1 april 2014 
and to 20 from 1 april 2015 was included in the finance act 2013 which was enacted in july 2013 the closing 
deferred tax balances have therefore been removed accordingly
8 transactions with related parties
 there were no transactions with any related parties during the year other than those exempt from disclosure under 
frs 8 accounts
122  five year summary 
for the year ended 31 december 2013
ifrs
2009  
£m
2010  
£m
2011  
£m 
restated
2012  
£m 
2013  
£m
results
revenue
continuing operations 903  1048  1020  1027  1121
discontinued operations 199  69 – –  – 
1102  1117  1020  1027  1121 
profit from operations before exceptional items
continuing operations 92  144  150  171  180
discontinued operations – – – – – 
92  144  150  171  180 
profit on ordinary activities before taxation  
and exceptional items 55  125  140  117  143 
assets 
noncurrent assets 321  291  329  282  226 
current assets 842  699  538  419  478 
assets classified as held for sale 121 – – – –
total assets 1284  990  867  701  704 
equity and liabilities
current liabilities 1008  354  823  225  620 
noncurrent liabilities 383  834  341  685  08 
liabilities directly associated with assets held for sale 212 – – – –
equity 319 198 297 209 76 
total equity and liabilities 1284  990  867  701  704 
key statistics
earnings per ordinary share – basic 137p 343p 380p 130p 322p
   – diluted 137p 329p 361p 125p 312p
dividends per ordinary share – – – – 20p
  the 2010 earnings per ordinary share figures have been restated to exclude ordinary shares purchased by the company  
from the weighted average number of ordinary shares calculation
  the 2012 results have been restated to disclose amendments resulting in applying updated ias19 and also for investments previously  
held in current assets
 123
stv annual report  accounts 2013
shareholders
shareholder information
registrars
capita asset services 
the registry 34 beckenham road 
beckenham kent br3 4tu 
tel 0871 664 0300 
tel overseas 44 20 8639 3399 
fax 44 0 1484 600 911 
email ssdcapitacouk 
website wwwcapitashareportalcom
independent auditors
pricewaterhousecoopers llp 
chartered accountants and statutory auditors  
141 bothwell street 
glasgow g2 7eq
solicitors
herbert smith freehills llp 
exchange house 
primrose street 
london ec2a 2hs
burness paull llp 
120 bothwell street 
glasgow g2 7jl
principal bankers
bank of scotland plc 
the mound 
edinburgh eh1 1yz
stockbrokers
peel hunt 
moor house 
120 london wall 
london ec2y 5et
secretary and registered office
jane e a tames 
company secretary 
stv group plc 
pacific quay 
glasgow g51 1pq 
tel 0141 300 3074 
email janetamesstvtv
company registration number 
sc203873
annual report on internet
the 2013 annual report of stv group plc including the financial statements is available at wwwstvplctv 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 
eleanor marshall 
pr manager 
stv group plc 
pacific quay 
glasgow g51 1pq 
tel 0141 300 3670 
email eleanormarshallstvtv
share price information
the share price of stv group plc is published in most newspapers and 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 lowcost and 
taxefficient 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
your shareholding
you 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 wwwcapitadealcom online dealing  
0871 664 0454 telephone dealing
 calls cost 10p per minute plus network extras lines are open 830am530pm monday to friday
 calls cost 10p per minute plus network extras lines are open 8am430pm monday to friday 
shareholders
124  s ha r e hol de r i n f o r m a t io n 
continued 125
stv annual report  accounts 2013
 notice of annual general meeting
 this information is important and requires your immediate attention 
  if you are in any doubt as to the action you should take you should seek your own advice from a 
stockbroker bank manager solicitor accountant or other independent professional adviser authorised 
under the financial services and markets act 2000
  if you have sold or transferred all of your shares please pass this document together with the 
accompanying documents to the purchaser or transferee or to the person who arranged the sale  
or transfer so they can pass these documents to the person who now holds the shares
the agm is an important opportunity for all shareholders to express their views by asking questions of the directors  
and voting on the resolutions 
the directors consider that each of the proposals detailed in the notice of annual general meeting will be of benefit  
to and are in the best interests of the company and the shareholders as a whole the directors therefore unanimously 
recommend that shareholders vote in favour of the resolutions as the directors intend to do in respect of their own 
holdings of shares in the company
notice is hereby given that the annual general meeting of the company will be held at pacific quay glasgow g51 1pq 
on wednesday 23 april 2014 at 11 am for the purpose of considering the resolutions below
resolutions 1 to 10 inclusive will be proposed as ordinary resolutions and resolutions 11 to 13 inclusive shall be 
proposed as special resolutions 
ordinary resolutions
1  to consider and adopt the annual accounts of the company for the financial year ended 31 december 2013 which 
includes the reports of the directors and the report by the auditors on the annual accounts and the auditable part  
of the directors’ remuneration report
2  to approve the directors’ remuneration report other than the part containing the directors’ remuneration  
policy in the form set out on pages 67 to 78 of the annual report and accounts for the financial year ended  
31 december 2013
  as required by the directors’ remuneration report regulations 2002 the company’s auditors 
pricewaterhousecoopers llp have audited those parts of the directors’ remuneration report capable  
of being audited
3  to approve the directors’ remuneration policy in the form set out on pages 55 to 66 of the annual report and 
accounts for the financial year ended 31 december 2013 
 
  following a change in law since the 2013 agm resolution 3 seeks approval on a binding basis of the remuneration 
policy governing directors’ remuneration if the remuneration policy is approved and remains unchanged it will be  
valid for up to three financial years without a new shareholder approval if the company wishes to change the 
directors’ remuneration policy it will need to put the revised policy to shareholders to vote on before it can implement 
any new policy
4 to declare a final dividend of 20p per ordinary share
 
  the board proposes a dividend of 20p per ordinary share for the year ended 31 december 2013 if approved  
the recommended dividend will be paid on 23 may 2014 to all shareholders who are on the register of members  
at the close of business on the record date of 22 april 2014  5 to elect margaret ford as a director of the company having been appointed since the last annual general meeting
  margaret ford is standing for election following her appointment as a nonexecutive director on 1 june 2013 and as 
non executive chairman on 31 august 2013 the articles of association require that a director appointed by the 
board since the last annual general meeting should retire at the next annual general meeting and stand for election 
to the board in order to give shareholders a chance to confirm the appointment
  biographical details of margaret ford can be found on page 38 and the board confirms that she meets the 
independence criteria as set out in b11 of the uk corporate governance code
6 to reelect george watt 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 reelection on the third anniversary of their election or reelection this gives you the chance to confirm  
their appointments
 
  biographical details of george watt can be found on page 38 and following formal performance evaluation  
mr watt’s performance continues to be effective and to demonstrate commitment to the role
7 to reelect david shearer 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 reelection on the third anniversary of their election or reelection this gives you the chance to confirm  
their appointments
  biographical details of david shearer can be found on page 38 and the board confirms that he meets the 
independence criteria as set out in b11 of the uk corporate governance code following formal performance 
evaluation mr shearer’s performance continues to be effective and to demonstrate commitment to the role
8 to reelect michael jackson 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 reelection on the third anniversary of their election or reelection this gives you the chance to confirm  
their appointments
 
  biographical details of michael jackson can be found on page 38 and the board confirms that he meets the 
independence criteria as set out in b11 of the uk corporate governance code following formal performance 
evaluation mr jackson’s performance continues to be effective and to demonstrate commitment to the role
9  to reappoint 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
10  that for the purpose of section 551 of the companies act 2006 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 that act 
 a up to an aggregate nominal amount of £6508370
 b   up to an aggregate nominal amount of £6508370 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 subject to such exclusions or other arrangements as the directors may deem necessary or 
expedient to deal with treasury shares fractional entitlements or legal or practical problems arising under the 
shareholders
126  notice of annual general meeting 
continued 127
stv annual report  accounts 2013
laws of any overseas territory or the requirements of any regulatory body or stock exchange or by virtue of 
shares being represented by depositary receipts or any other matters 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 and all unexercised 
authorities previously granted to the directors to allot equity securities are revoked
    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 13016740 being shares representing one third of the ordinary issued share capital at 12 march 2014 
the latest practicable date prior to publication 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 13016740 being shares 
representing one third of the ordinary issued share capital at 12 march 2014 excluding treasury shares none 
of which are held by the company pursuant to a fully preemptive 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 
2015 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 reelection at the next agm
special resolutions
11   that subject to the passing of resolution 10 the directors be and are hereby empowered pursuant to section 570  
of the companies act 2006 to allot equity securities within the meaning of section 560 of that act for cash either 
pursuant to the authority conferred by resolution or by way of a sale of treasury shares as if section 561 of that 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 an offer of securities but in the case of the authority 
granted under paragraph b of resolution 10 by way of rights issue only in favour of ordinary shareholders  
of the company and other persons entitled to participate therein where the equity securities respectively 
attributable to the interest of all such holders are proportionate as nearly as may be practicable to the 
respective numbers of ordinary shares held or deemed to be held by them subject to such exclusions or  
other arrangements as the directors may deem necessary or expedient to deal with treasury shares fractional 
entitlements or legal or practical problems arising under the laws of any overseas territory or the requirements 
of any regulatory body or any stock exchange or by virtue of shares being represented by depositary receipts 
or any other matter and
  b  the allotment of equity securities otherwise than pursuant to paragraph a above having a nominal value not 
exceeding in the aggregate £976255
    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 offers or agreements 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 1952511 shares 
representing 5 of the ordinary issued share capital at 12 march 2014 other than to existing shareholders  
in proportion to their existing shareholdings
   it also allows the directors to allot shares up to a nominal amount of £13016740 representing two thirds of the 
company’s issued share capital on an offer to existing shareholders on a preemptive basis however unless the shares 
are allotted pursuant to a rights issue the directors may only allot shares up to a nominal value of £6508370 
representing one third of the company’s issued share capital the authority will terminate at the next annual general 
meeting which must be held no later than 30 june 2015 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 75 of the issued share capital would be issued on a non preemptive basis in any three
year period 
12  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 maximum number of shares acquired pursuant to this authority shall not exceed 3905022 shares  
the nominal value of which is £1952511
 b  the minimum price excluding expenses which may be paid by the company for a share purchased pursuant 
to this authority shall be 50p
 c  the maximum price excluding expenses 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 
 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 the 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 3905022 shares representing 10 of the ordinary issued share capital in 
issue at 12 march 2014 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 12 march 2014 warrants and options to subscribe for 658523 of the company’s shares were 
outstanding representing 169 of the ordinary shares in issue at 12 march 2014 excluding treasury shares 
held by the company and 187 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
shareholders
128  notice of annual general meeting 
continued 129
stv annual report  accounts 2013
13  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 the shorter notice period would not be used as a matter of routine for such 
meetings but only where this was merited by the nature or urgency of the business of the meeting and was thought 
to be to the advantage of shareholders as a whole  
by order of the board
jane e a tames
company secretary
stv group plc
pacific quay
glasgow g51 1pq
12 march 2014
 
notes
1  information regarding the meeting including the contents of this notice details of the total number of shares in 
respect of which members are entitled to exercise voting rights at the meeting details of the totals of the voting rights 
that members are entitled to exercise at the meeting and if applicable any members’ statements members’ 
resolutions or members’ matters of business received by the company after the date of this notice 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 
3  a proxy need not be a shareholder of the company but must attend the meeting to represent you your proxy could 
be the chairman or other person who has agreed to attend to represent you your proxy will vote as you instruct and 
must attend the meeting for your vote to be counted details of how to appoint the chairman or another person as 
your proxy using the proxy form are set out in the notes to the proxy form 
4  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 asset services on 0871 664 0300 or shareholderenquiriescapitacouk calls cost 10p per minute 
plus network extras lines are open 830am to 530pm monday to friday alternatively you may appoint a proxy 
electronically at wwwcapitashareportalcom please see the notes to the form of proxy for further details
5  to 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 asset services the registry 34 beckenham road 
beckenham kent br3 4tu no later than 1100am on 21 april 2014 or 48 hours before the time of any adjournment 
of the meeting
6  the return of a completed proxy form in writing or online or any crest proxy instruction as described in paragraph 
11 below will not prevent a shareholder attending the annual general meeting and voting in person if heshe wishes 
to do so 7  a copy of this notice has been sent for information only to persons who have been nominated by a member to enjoy 
information rights under section 146 of the companies act 2006 a “nominated person” the right to appoint a 
proxy cannot be exercised by a nominated person however 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
8  to 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 21 april 2014 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 or the adjourned meeting
9  as at 12 march 2014 being the last business day prior to the publication of this notice the company’s issued share 
capital consists of 39050220 ordinary shares of 50p each carrying one vote each the company does not hold any 
ordinary shares in the capital of the company in treasury therefore the total voting rights in the company as at 12 
march 2014 are 39050220
10  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 on the euroclear website wwweuroclearcom 
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
11   in order for a proxy appointment made by means of crest to be valid the appropriate crest message “a crest 
proxy instruction” must be properly authenticated in accordance with euroclear uk  ireland limited’s “eui” 
specifications and must contain the information required for such instructions 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 asset services idra10 by 1100am on 21 april 2014 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
12  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
13  the company may treat as invalid a crest proxy instruction in the circumstances set out in regulation 355a  
of the uncertificated securities regulations 2001
shareholders
130  notice of annual general meeting 
continued 131
stv annual report  accounts 2013
14  to change your proxy instructions simply submit a new proxy appointment using the methods set out above note that 
the cutoff time for receipt of proxy appointments see above also apply in relation to amended instructions any amended 
proxy appointment received after the relevant cutoff time will be disregarded where you have appointed a proxy 
using the hardcopy proxy form and would like to change the instructions using another hardcopy proxy form please 
contact capita asset services on 0871 664 0300 or shareholderenquiriescapitacouk calls cost 10p per minute 
plus network extras lines are open 830am to 530pm monday to friday if you submit more than one valid proxy 
appointment the appointment received last before the latest time for the receipt of proxies will take precedence
15 in order to revoke a proxy instruction you will need to inform the company using one of the following methods
 •  by sending a signed hard copy notice clearly stating your intention to revoke your proxy appointment to capita 
asset services the registry 34 beckenham road beckenham kent br3 4tu in the case of a member which is 
a company the revocation notice must be executed under its common seal or signed on its behalf by an officer of 
the company or an attorney for the company any power of attorney or any other authority under which the 
revocation notice is signed or a duly certified copy of such power or authority must be included  
with the revocation notice
 • by sending an email to shareholderenquiriescapitacouk
  in either case the revocation notice must be received by capita asset services no later than 8am on 23 april 2014 or 
3 hours before the time of any adjourned meeting thereof if you attempt to revoke your proxy appointment  
but the revocation is received after the time specified then subject to the paragraph directly below your proxy 
appointment will remain valid appointment of a proxy does not preclude you from attending the annual general 
meeting and voting in person if you have appointed a proxy and attend the annual general meeting in person your 
proxy appointment will automatically be terminated 
16  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
17  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 cannot require the shareholders requesting 
any such website publication to pay its expenses 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 auditors 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 18  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
19  members satisfying the thresholds in section 338a of the companies act 2006 may request the company to include 
in the business to be dealt with at the annual general meeting any matter other than a proposed resolution which 
may properly be included in the business at the annual general meeting a matter may properly be included in  
the business at the annual general meeting unless i it is defamatory of any person or ii it is frivolous or vexatious  
a request made pursuant to this right may be in hard copy or electronic form must identify the matter to be included 
in the business must be accompanied by a statement setting out the grounds for the request 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
20  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
21  copies of executive directors’ service agreements and copies of the letters of appointment of nonexecutive 
directors are available for inspection at the company’s registered office during normal business hours from  
the date of this notice until the close of the annual general meeting saturdays sundays and public holidays 
excepted and will be available for inspection at the place of the meeting for at least 15 minutes prior to and  
during the meeting
22  except as provided above members who have general queries about the annual general meeting should call  
our shareholder helpline on 0871 664 0300
 you 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
shareholders
132  notice of annual general meeting 
continued contents
directors’ report
strategic report
01 2013 financial highlights
02 stv – at a glance
04 chairman’s statement
06 chief executive’s review – qa
10 – consumer
18 – production
24 performance review
27 – kpis 20112015
29 principal risks
31 corporate responsibility
corporate governance
38 board of directors 
40 corporate governance report
54 remuneration report
accounts
80  stv group plc consolidated financial  
statements – independent auditors’ report 
84 consolidated income statement
84  c o ns o li d a t e d s t a t e m e n t  
of comprehensive income
85 consolidated balance sheet
86 consolidated statement of changes in equity
87 consolidated statement of cash flows
88 notes to the financial statements
112  stv group plc company financial statements 
– independent auditors’ report
114 company balance sheet
115  statement of total recognised  
gains and losses
116 notes to the company financial statements
122 fiveyear summary
shareholders
123 shareholder information
125 notice of annual general meeting
designed and produced by tayburn company registration number sc203873
the stv appeal 2014 is here  
visit wwwstvtvappeal to see how you can help
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
stv group plc
pacific quay
glasgow g51 1pq
tel 0141 300 3000
wwwstvtv
annual report  accounts 2013 stv group plc
annual report
 accounts 2013
commercially focused 
creatively led


Summary:
 directors’ report – strategic report
02 stv – at a glance
•  stv reaches 36 million viewers each 
month with first class programming and 
the most comprehensive local news 
service in the uk 
•  stv productions is one of the uk’s leading 
production businesses with ambitious 
plans for growth in the uk and overseas
•  stv’s digital business incorporates 
scotland’s most popular commercial 
media website stvtv stv recently 
launched new digital services providing  
all the latest news events offers  
pictures and videos for consumers  
in scotland’s four main cities
•  in june 2014 stv will launch stv 
glasgow a brand new cityfocused  
tv channel available on freeview  
sky and online
•  stv content is available across multi 
platforms including ios android ps3 
windows 8 youview and samsung  
smart tv
our business
engagement and cover all stv 
services the key corporate kpis 
detailed on pages 27 and 28 are used 
to monitor and measure the progress 
of each division in fulfilling its strategy 
stv productions
creates and produces high quality  
content for broadcast networks  
in the uk and overseas
profit is made on initial sale and  
on the exploitation of back end  
rights in the uk secondary and 
overseas markets
advertising
content
advertising
     consumers
content 
consumers
our business model
stv consumer
delivers unique high quality content 
to attract mass audiences which  
are sold to advertisers to generate 
revenues the content is delivered 
across multiple platforms including 
digital terrestrial cable and satellite 
online and through connected 
devices such as games consoles  
and smart tvs the business aims  
to use its unique content to create 
communities of interest and to 
engage consumers the kpis have 
been reviewed and new metrics  
will be introduced in 2014 to drive 
increased focus on consumer 
by 2015 we will
•  grow nonbroadcast earnings to represent  
33 of group earnings
• double stv productions’ revenues based on 2011 revenues
•  be the most used digital service in scotland
•  launch two new marketleading digital  
consumer propositions
• maintain our position as the ‘voice of scotland’
our strategic aims as set out in 2012 03
stv annual report  accounts 2013

edinburgh
dundee
glasgow
91
aberdeen
aberdeen
dundee
edinburgh
glasgow
edinburgh
glasgow
covering scotland
stv is scotland’s leading media 
brand connecting with consumers 
and creating opportunities for 
commercial partners across 
channels and platforms at a 
national regional and city level
each month stv reaches  
91 of scots on air 
network coverage
stv’s micro regions offer 
advertisers the opportunity  
to geotarget their tv  
marketing campaigns
micro regions
stv secured licences in early  
2013 for local tv in glasgow  
and edinburgh 
city tv
stv glasgow stv edinburgh  
stv aberdeen and stv dundee 
available to download for free  
as apps 
city apps
superserving scotland  
with relevant locallyfocused 
and engaging content 
key metropolitan areas