31 March 2014
ITV Pension Partnership
ITV and the Trustee of the main section of the ITV Pension Scheme (the "Scheme") have concluded a Partnership (the "Partnership"), backed by the London Television Centre ("LTVC") property, and, as a consequence, ITV's pension deficit on a funding basis is reduced by £50m immediately.
As a result of the Partnership arrangement, the Scheme will receive 25 annual payments, if and to the extent that the Scheme remains in deficit. Following an initial payment of £2.05m paid on 31 March 2014 the annual distributions will increase at the rate of 5% per annum. The £50m reduction in the pension funding deficit effectively reflects the net present value of these payments and ITV will receive tax relief on this amount in 2014.
The agreement does not impact the deficit calculated on an IAS 19 basis. Ownership of LTVC remains with ITV.
Following this agreement, ITV's cash payments towards deficit funding in 2014 are expected to total £91m.
Ian Griffiths, Group Finance Director said:
'Over the last few years ITV has made significant progress in managing its pension risk and this is another step forward in that process. Today's agreement reduces ITV's pension deficit on the basis that drives our cash funding whilst retaining operational flexibility with respect to the LTVC. It represents a positive deal for members of the defined benefit pension scheme and for ITV shareholders'.
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