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The launch of an ITV2+1 will fuel speculation that the launch will be a holding platform for a new standalone digital channel as part of ITV's digital investment programme.

The broadcaster said that it had identified new revenue streams from its digital channels that would increase revenue from £715m in 2005 to between £1.2bn and £1.4bn by the end of 2010.

ITV said that first-half total revenue was estimated to be up 2% on the previous year, and that its revenues had been less affected than other media, including newspapers and radio. However, it said ad revenue was down by 4.6%.

The company will increase its cash return to shareholders from £300m to £500m during 2006. The broadcaster has also tasked itself with delivering efficiency savings of £100m by the end of 2008 as a result of "re-engineering and operation reviews". This is in addition to the £120m worth of savings it says it has already delivered as part of the merger of Carlton and Granada.

It said that it would cut back £40m a year from "improved overhead efficiencies", £30m from scheduling efficiencies and £30m from reduced sports programming costs.

ITV also outlined its strategy for future growth across its channels, content, consumer and commercial operations, by increasing investment in multichannel programming by £20m in 2007.

Charles Allen, ITV chief executive, said: "Since the merger, ITV has increased its profitability, delivered ahead of all its targets, raised £400m from the disposal of its non-core assets and will have paid £1.1bn to shareholders in dividends and share buybacks by the end of 2006.

"We continue to set ourselves aggressive targets. ITV with its strong brand, original content, Freeview capacity and cross-promotional capability is uniquely well-positioned to benefit as the UK televisions market continues to fragment and the number of outlets and demand for high-quality content continues to fragment and the number of outlets and demand for high-quality content continues to increase."

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