Ulster Television has reported a fall in profits, despite escaping the worst of the slump in ITV advertising.

The owner of the ITV franchise for Northern Ireland said pre-tax profits for the first six months of the year had fallen from £7.15m to £7m.

Television advertising revenue also fell from £19.7m to £18.8m, a decline of 4.9%.

John McGuckian, the chairman of UTV, said the company was not expecting a recovery until next year.

"Many industry observers are predicting that a return to growth is not likely until 2002 and, for budgeting purposes, we have adopted this cautious approach," he said.

But UTV has been sheltered form the worst ravages of the advertising downturn, as it saw little of the dot.com money that stoked the boom in revenues last year.

UTV outperformed its ITV rivals, who have reported a 15% drop in advertising income so far this year.

"We do expect to continue to outperform the ITV network average and to the end the year with an improved share over 2000. Cost control will continue to be a key factor in the second half of 2001," said Mr McGuckian.

However, the company said it was freezing its budget to offset the effects of a downturn.

The company also owns radio stations in Ireland, where advertising revenue grew by 6% between April and June.

UTV is also part of the Channel 3 consortium bidding for the ITV news contract.