Total revenue for 2008 was down 4% to £906.1m with advertising revenue down to £789.7m year-on-year from £825.2m.
The broadcaster says it is budgeting for the lower revenue by reducing editorial spend by at least 10% across its network. It cut more than a quarter of its workforce during 2008 to reduce the group's headcount to close to 700. Transmission and sales costs were down 5% to £846.9m last year.
Despite the cuts the broadcaster managed to maintain its share of total viewing at 11.9%.
Chief executive Andy Duncan, said: 'We have taken strong action to further improve efficiency and align our cost base with the advertising market downturn. But we are facing the worst economic conditions in our history as well as the digital migration of audiences and revenues online and cost reductions will inevitably be even deeper in 2009. To maintain Channel 4's creative and public impact a new and more sustainable funding model is needed for the future.'
The Government has commissioned a report looking into the options for funding commercial TV networks and the BBC. One option is for Channel 4 to merge with the BBC's commercial arm, BBC Worldwide. A channel Five merger has also been mooted.
Across 2008 Channel 4's group spend on programmes and content reduced by £25.6m or 4% to £598.6m. It says this was in response to a £35.5m reduction in its TV advertising revenue. The reduction in the programme budget contributed towards the cost of transmission and sales falling by £41.6m.
There were 133m views of Channel 4 programmes via on demand services in 2008, as well as 175m visits to channel4.com and E4.com and 1.1bn page views.
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