The maker of hit TV shows such as Channel 4’s Big Mood and The Responder for the BBC has seen its profit slashed in half amid “budgetary pressures” on UK television channels, according to newly-filed documents.
London-based Dancing Ledge Productions, which has been majority owned by giant Freemantle since 2022, saw its turnover dip to £19m in 2023, down from £29m in the year before.
As a result its pre-tax profit halved to £635,000 during the 12 months from just under £1.3m in 2022.
As well as making The Responder, which stars Martin Freeman and Black Mirror actress Emily Fairn, the company also produces the BBC shows Domino Day, Crossfire and The Salisbury Poisonings, ITV’s Platform 7, Netflix’s Delhi Crime and Hulu comedy Wedding Season.
Its founder Laurence Bowen and managing director Chris Carey also have stakes in the firm.
In a statement published to Companies House, Dancing Ledge Productions said: “The principal activity and success driver of the business is the production of television programmes, the exploitation of IP rights and the attraction and retention of key talent to deliver these activities.
“As part of its growth strategy, the group continues to diversify its customer base to take advantage of opportunities available in linear and non-linear broadcast channels.
“The key risks and uncertainties affecting the business are the rising costs of production caused by inflation, interest rates and near full employment in the sector.
“The group faces strong competition and its ability to secure commissions and deliver within budget is impacted by the budgetary pressures facing all channels.
“The close monitoring of profitability as well as the continued development of ideas with international appeal are key to the continuing success of the business.”
How are UK production companies faring?
Production firms in the UK have delivered a mixed bag of results over the past couple of years.
Earlier this year it was revealed that Whisper Films, the TV production company co-founded by broadcaster Jake Humphrey and former F1 driver David Coulthard, was forced into the red despite its turnover jumping.
The company produces coverage of F1, international cricket, boxing, MMA, the women’s Super League.
The maker of shows including Taskmaster, Not Going Out and Catastrophe also saw a drop in profit despite its turnover rising to nearly £100m year to June 30, 2023, up from £88.3m. Its pre-tax profits declined from £9.9m to £7.7m over the same period.
The group said its profits were impacted by an increase in lower margin revenue streams that were previously hit by the Covid-19 pandemic. It added that overheads also rose with its higher revenue.
It was a similar story at James Corden’s production company Fulwell, which widened its pre-tax loss to £12m in the year ending July 31, 2023, from £11.2m in the previous year.
This was despite the company, which produces The Kardashians, Friends: the Reunion, and Sunderland Til I Die, increasing its turnover to almost £100m.
What pressures is The Responder maker facing?
The maker of The Responder said its financial performance had been impacted by budget pressures at the UK’s biggest TV channels.
In January Channel 4 made headlines when it revealed plans to shed almost 250 jobs – more than 15 per cent of its workforce.
Its chief executive Alex Mahon said the cuts were due to the worst TV advertising downturn since 2008.
Over the past couple of years the broadcaster has already cut back on its shows, including daytime chat show Steph’s Packed Lunch, SAS: Who Dares Wins and The Big Narstie Show, in a blow to production companies.
In May ITV followed suit, announcing plans to cut 200 jobs in a bid to save £50m. In 2023 the channel also cut £10m from its programming budget.
The BBC has also implemented a slate of high-profile cuts, broadcasting 1,000 fewer hours of new TV programmes in 2023. This involved cuts to its sports programming and more archive material used on BBC Four.
It blamed the current freeze of the price of a TV licence for placing “significant financial challenges on the BBC at a time of high inflation and media super-inflation”, according to its most recent annual report.