The controversy surrounding on-air premium-rate phone lines has hit ITV's revenues by 20 per cent as the struggling broadcaster admitted today that it is concerned over viewer confidence.

Ofcom, the media regulator, is still investigating 20 cases over whether viewers have been overcharged for taking part in phone-in competitions and voting.

Last week, ITV said its programmes had been cleared of any wrongdoing, and cases against its prime time programmes including Ant and Dec's Saturday Night Takeaway and I'm a Celebrity...Get Me Out of Here! had been closed.

However, ITV said revenue from premium phone lines fell by 20 per cent in March and April, and it has seen a decline from ITV Play, its late night quiz show which has now been substantially cut back and airs on ITV1 and ITV2. Shares in ITV dipped by 1 per cent to 118.8p in early trading.

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It added: "Concerns remain about when consumer confidence in this area will be restored."

ITV suspended all its premium rate phone services after it emerged that Channel Four's Richard & Judy show was encouraging viewers to call in to take part in competitions despite the fact that contestants had already been chosen.

ITV outlined its fears in a statement issued before its Annual General Meeting (AGM) today.

n its last financial year, both ITV Play and premium rate phone lines generated around £100 million in revenues, split evenly between the two services. All ITV's premium phone line services have now been cleared following a review by Deloitte, the accountancy firm. Deloitte is now examining contests and voting over the past two years with a result expected in summer.

Today's figures are the first to be produced under the stewardship of Michael Grade, the former chairman at the BBC, who became executive chairman at ITV on January 8.

ITV's management is expected to face pressure from shareholders at today's AGM about Mr Grade's pay packet. He has been promised a bonus of 150 per cent of salary every year on top of his £825,000 basic pay and also, he cannot be fired in his first year. It is also understood that Mr Grade is courting Dawn Airy, the former launch controller at Channel 5, and has offered her £1.5 million to take a senior role at ITV.

Revenues from ITV1, the company's flagship channel, fell by 9.6 per cent during the six months to June 30, while overall revenues declined by 5.7 per cent. ITV is able to calculate its sales to the end of June, despite issuing its figures in May, as it forward sells on its advertising by signing year- long contracts.

Although revenue continues to decline, ITV said today that UK advertising had stabilised. The take-up of digital channels has resulted in ITV1's share of commercial impacts declining by 6.2 per cent to 32.6 per cent in the first 17 weeks of the year to April 29. In the same period last year, the decline was 10 per cent.

While its digital channels have grown by 18 per cent, overall, ITV share of commercial impacts fell by 3.8 per cent to 41.7 per cent.

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