Coronation Street maker Granada Media saw its shares plunge by more than 10 per cent after it warned that its revenues this year would be lower than last year.

The company only floated two months ago but it said the lack of blockbuster sports events like the Rugby World Cup and Euro 2000 meant that its advertising revenue would be lower.

"There are no such major events in the coming financial year," Granada Media said in a trading statement.

The warning came just a day after a top analyst at broker Merrill Lynch cut his forecasts for the company by 20 per cent, sending the shares sharply lower.

Granada said it expected advertising revenue to increase by 8.4 per cent for the year - ahead of ITV as a whole and the highest level of growth in 10 years.

The first half saw advertising grow at 11 per cent while the second half came in at a more sedate 6 per cent.

The company was upbeat about prospects in the medium term, and pointed to the benefits of having Meridian and Anglia on board following its takeover of United News's TV assets.

Granada has also taken a 45 per cent stake in Ireland's TV3, which was linked to a programme supply deal.

Its portfolio of soaps now includes an expanded Emmerdale, which will run on five nights a week, the new ITV drama Trafalgar Road - and of course Coronation Street.

Broker ABN AMRO said it had cut its 2001 advertising revenue forecasts for both Granada Media and Carlton Communications on the back of the warning.

ABN analysts said they had cut advertising revenue forecasts for Granada Media from 6.2 per cent growth for the period of October 2000 to September 2001 to two per cent growth.

They cut forecasts for Carlton to 1.2 per cent growth from six per cent.

Weighing on many analysts minds has been the return next year of ITN's News At Ten slot, which could also affect advertising revenues.

The news also focused attention on ITV's declining market share, which most commentators expect to get worse as the satellite, digital and cable channels continue to expand.

Related links Granada Media website Carlton TV website

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