THE Merseyside firm behind hit ITV2 show, The Only Way Is Essex, maintained profits above £10m last year, despite a marked fall in revenues.

Childwall-based Lime Pictures was unable to maintain the £9.3m turnover growth it achieved in its 2009 financial year, with revenues dropping by £6.4m to £39.1m in the year to August, 2010.

However, despite a 14% fall in revenues, pre-tax profits slipped only 3%, to £10.1m. A £370,000 adjustment on a previous tax bill resulted in Lime’s post-tax profit being slightly improved, at £7.6m.

The Only Way Is Essex caused a sensation when it launched last October, after the end of Lime Pictures’ financial year.

Last month the programme won a Bafta, the YouTube Audience Award – to the delight of fans and the consternation of some traditionalists within the industry.

Lime describes the programme as “reality drama”. It follows the lives of real people, but is structured to follow the rhythm of soap operas. The company also continues to produce teen soap Hollyoaks, which it created in 1995, and led to the spin-off, The Hollyoaks Music Show.

It has also enjoyed success with children’s drama House of Anubis, which it filmed in Speke for US children’s channel Nickelodeon. The show, which is about a group of boarding school teens, launched in the UK in February.

A dividend of £6.3m was paid to a group company, with the balance added to shareholders’ funds, which stood at £5.2m at the year end.

Lime Pictures’ ultimate parent company is All3Media, a group of television, film and new media production companies from across the UK, Germany, the Netherlands, New Zealand, Australia and the USA.

All3Media, which makes Shameless, Skins and Undercover Boss, is undergoing a strategic review which could result in the company being sold for up to £750m.

It is controlled by private equity group Permira, which has a 60% stake.

Lime Pictures was founded by Phil Redmond in 1982 as Mersey Television and changed its name when it was sold to All3Media in 2005.