Analysts are backing to ITV after being impressed by its reversal of fortunes, first half profits of £97 million for 2010, and plans to broaden its business model.

During the prior-year period, the company reported a loss of £105 million for the six months to 30 June 2009.

The TV station also announced a rise in net advertising revenue to 18 per cent.

Adam Crozier, chief executive of ITV, said the station would undergo a five-year plan to offer internet-based platforms, high definition and pay TV.

He said, ‘Our priority for the next 18 months is to make ITV a creatively dynamic and fit for purpose organisation while maintaining strict financial controls.

‘Over time we expect to move to a position whereby half of ITV's revenue base will be derived from non-television advertising sources and today we are announcing our move into pay television with the agreement to make HD versions of ITV 2, 3 and 4 pay channels on Sky.’

Nick Raynor, investment adviser at The Share Centre, said although the firm had seen a drop in early morning trading, investors should take heart from the results.

He said, ‘These are good results for ITV and are ahead of expectations.

‘However, investors will be disappointed by the market's reaction to these results, as early morning trading saw the share price fall 3 per cent.’

‘We would have expected to see a better reaction and encourage investors to take advantage of the weakness in price and consider the broadcaster as an addition to their portfolio,’ said Raynor.

The analyst said the TV station had been a laggard in the rapidly changing market, but viewed the new plans positively.

‘The announcement of a five-year strategy to reduce its dependency on advertising and move into the world of internet based platforms, high definition and pay TV looks encouraging for future growth,’ he said.

‘Investors willing to accept a higher degree of risk may wish to consider ITV, especially as we watch to see how its move toward pay television for high definition versions of its channels plays out.’