For the six months to March 31, the company posted pre-tax profits of £112m, down from last year's pro forma figure of £125m. Turnover fell 1% from £784m in 2000 to £779m.
At 3pm in London, Granada's share price had risen 1.5% to 169.5p from the previous close of 167p.
Net advertising revenues for the period fell 5.4% to £486m from last year's record figure of £514m, which was largely attributed to the boom in dotcom advertising. Third-quarter net advertising revenues are expected to be £216m.
Chief executive Steve Morrison said that retail companies had been the company's biggest advertisers during the period. Financial and food sectors followed, although the financial sector showed signs of reducing its advertising spend in the third quarter.
The motoring sector, which has reduced its advertising spend on ITV by around £11m this half, showed signs of recovery in the third quarter similar to what it spent in the same period in 2000.
For the nine months to July, Granada reported a 10.6% drop in advertising revenues. June revenues are down 11% year-on-year while July will be down 17%-18%, ahead of forecasts which expected the fall to be as much as 25%.
An 18% fall will see July revenues come in at £58m against last year's figure of £70.6m. The company said 90% of July's advertising had been confirmed.
However, chairman Charles Allen said he did not know when the market would begin to pick up again.
The reorganisation at Granada follows the integration of the ITV assets acquired from the former United News & Media, which has already resulted in savings of £30m in the current year.
The group will be reduced from six units -- ITV, broadcasting, enterprises, ONdigital, creative and broadband -- to four: ITV & ITV Digital, enterprises, creative and broadband.
ITV, ITV Digital and enterprises will be housed under one business, called Platforms, while creative and broadband will be brought into a Content division.
The Content business will create all the group's multimedia content. It will be headed up by Simon Schapps, who has been promoted to the position of managing director. The company said it is recruiting for a managing director of the Granada Platforms unit.
The overhaul is expected to result in the loss of almost 100 staff, mainly from scrapping a layer of management, over the next three years.
The restructuring of ITV, which is being implemented by Granada and its partner Carlton, is also expected to save £20m this year. Details of the channel's overhaul will be announced in the next two weeks by ITV's recently appointed managing director Stuart Prebble.
Overall, Granada will make savings of £60m a year by 2003 and aims to improve profits by 3% for every 1% rise in advertising revenues.