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ITV has seen an “upward trajectory” in ad sales since July after reporting a 43% slump in the second quarter because of coronavirus – “the most severe decline in the history of ITV”.

Advertising revenue fell 23% in July, after declines of 42% in April, 46% in May and 42% in June.

The financial performance of Britain’s biggest commercial broadcaster by ad revenue is closely watched because it is seen as an economic bellwether. 

Over the course of the first six months of the year, ITV’s total ad revenue fell 21%, or £178m, to £671m.

Linear TV spot advertising performed worse, given that online ads on ITV Hub fell only 3% over the half-year.

Dame Carolyn McCall, chief executive, would not offer financial guidance for the rest of the year.

However, following the results, Numis Securities estimated ITV’s ad sales could be down by about 9% in the second half of 2020 – falling by 17% in the third quarter and 1% in the final quarter.

That would mean ad sales would be down 14% for the year, according to Numis. 

“Most advertising categories decreased their spend in Q2, with categories such as airlines and travel, cars and interior furnishings being the hardest hit, as travel restrictions were imposed and shops and showrooms were closed,” ITV said.

“While spend from online brands (excluding gambling) also declined in the period, they declined less than most categories and we did see increased spend from social network, OTT [over-the-top online businesses] and food-delivery brands, who benefited from people being at home. 

“Government, charities and other, and publishing and broadcasting, were the only categories to grow spend across the period."

Since July, ITV has seen the return of more categories, including “some FMCG and retail, publishing and broadcasting, cars and interior furnishings categories beginning to spend more”.

McCall added that there has been “a little bit of travel” as airlines sought to stimulate demand, although they are “not back to normal”.

ITV furloughed about 1,000 staff during lockdown, chiefly on the programme-making side as shows were cancelled, and about 300 remain on furlough.

The government’s furlough money was worth under £10m to ITV, according to McCall, who indicated that the broadcaster does not intend to repay it.

Filming of many key programmes, including Love Island, was cancelled because of coronavirus restrictions, but about 70% of production has returned.

ITV has made clear in the past that it opposes the government’s recently announced plans for a ban on all advertising for food high in fat, sugar or salt before 9pm, but McCall insisted that she did not want to comment further given conversations are ongoing and should remain “private”.

The broadcaster paid tribute to the work of its commercial team during the pandemic as it hosted weekly webinars for more than 3,000 customers and its in-house agency, ITV Creative, helped advertisers film and produce campaigns.

These included BT providing technology tips, "The people's ad break", Waitrose "Pick for Britain" and Just Eat taking over an ad break to support Britain Get Talking, ITV’s mental-health initiative.

“With the significant increase in television viewing volumes during the pandemic, there has been huge price deflation in cost of television advertising, becoming 50-60% cheaper than before the pandemic,” ITV said.

“With the proven return on investment which television offers, this has encouraged some digital brands to advertise on television for the first time, including car insurance brand By Miles, pregnancy app Peanut and Bionic, a comparison site for businesses. 

“The challenge for our commercial team will be to retain the advertising spend of these brands and bring back other advertisers to television as the outlook improves.”

ITV is allowing advertisers to target viewers via Planet V, an online sales platform for video-on-demand. 

About 35% of VoD inventory was available on Planet V by July and that should rise to 100% by the end of the year, when it is expected to be “live” with “most of the major agencies”, ITV said.

Profits before exceptional items halved in the half-year and ITV has suspended its dividend to conserve cash.

ITV's 43% ad sales decline in the second quarter is similar to Comcast's Sky, which reported a 41% drop across Europe.