Shares in ITV fell on the FTSE 250 in morning trading despite the broadcaster reporting a rise in net advertising revenue of 18 per cent.
The group said that EBITA more than tripled from last year to £165 million, while cost cutting measures had helped reduced net debt from £612 million at the end of last year to £437 million.
ITV said that despite a recovery in its financial performance, underlying structural challenges were still present.
No dividends will be paid, ITV said, due to the current levels of debt. In the third quarter ITV said it expected to see advertising revenue rise 15 per cent, however in the fourth quarter tough comparatives make the outlook more uncertain.
Adam Crozier, Chief Executive of ITV, said, "The good financial performance we have reported today has enabled us to reduce our debt significantly but does not disguise the underlying challenges we face. We are under no illusion that ITV needs to change substantially.
"For the past decade ITV has not faced up to the challenges presented by the rise of internet-based platforms, the continuing growth of pay TV and subscription services and the globalisation of content.
"Re-shaping the economics of ITV will require changes not only to the strategy but also to ITV's management, culture and organisation and to deliver this we are today announcing a five year Transformation Plan.
"Our priority for the next 18 months is to make ITV a creatively dynamic and fit for purpose organisation while maintaining strict financial controls. We have made swift progress in putting together a very strong management team fully focussed on delivering a lean ITV that can create world class content, executed across multiple platforms and sold around the world. 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."
By 10:20 shares in ITV were down 2.61 per cent on the FTSE 250 to 52.15 pence per share.