Everything seems rosy in the five garden. It's moving into profit for the first time, its share of TV advertising is up and, after suffering the loss of its programming chief, Kevin Lygo, to Channel 4, it has replaced him internally with the head of factual programming, Dan Chambers.
Last week, RTL Group, which owns 65 per cent of five, announced that it had made a profit for the first time on its investment. A paltry £700,000 maybe, but a profit nonetheless, compared with a loss of £2.1 million for the same six-month period last year.
And, in a generally flat UK TV sales market, five is having a good year.
Its 2003 sales revenues are likely to be up 9 per cent on 2002 and its share of TV advertising sales is now 7.9 per cent, up from 7.3 per cent a year ago.
The appointment of Chambers ended speculation that five would look outside to replace Lygo. A former head of science under Lygo at Channel 4, he followed his boss to five. So is he a genuine talent, who, like Lygo, will work creatively with a small programming budget of £160 million, or a cut-price option to appease shareholders keen to drive costs down?
Nick Milligan, five's deputy chief executive, is in no doubt: "Dan joined five soon after Kevin and he has really grown in this commercial environment.
He was given the freedom to take risks and develop commercial properties that delivered revenue streams as well as viewers. I am personally delighted that we have chosen one of our own and someone who shadowed Kevin so closely."
Observers feel that the role of the senior programmers at five will be vital. Chambers is the man behind five's increased commissioning of factual programming (it is gradually easing out the soft porn in favour of this).
He has been responsible for shows including Top Gear's rival Fifth Gear and World War One in Colour.
Five is citing its investment in factual programming and the success of CSI: Crime Scene Investigation (which pulls in regular audiences of close to two million) as its big scheduling successes of the year.
But can Chambers and the team build on this? Much of this may depend on the levels of funding received from its shareholders RTL and United Business Media. And judging by recent comments made by Gerhard Zeiler, the RTL chief executive, five will need to be particularly insistent with the begging bowl. He said of five: "It's not about throwing money around but being very smart in how you spend it. It is about creativity. That will be a key factor in the success of five."
Five observers hope Chambers can pull this off but have their doubts.
Nick Theakstone, the head of investment at MindShare, says: "Yes, five has done well but there are question-marks over its future. It's going to have a difficult time if it doesn't inject money into making the programming sufficiently different and there have to be question-marks over Lygo's replacement until he has proved himself."
But there may be more fundamental issues to address. The top management team - the chief executive, Jane Lighting, and deputy chief executive, Milligan - may seem to be a well-balanced management team but rumours were rife early on that relations between them were less than friendly.
But insiders argue that Lighting's strategic approach and Milligan's success on the sales side has secured mutual respect.
A bigger problem seems to be the uncertainty surrounding Milligan. He has been linked with both a move to Sky and the post-merger ITV. Publicly, he remains committed to five but many bet that he won't be there in a year's time.
And some argue that he would be difficult to replace. As one source close to five says: "If Milligan left there would be problems. At the end of the day it's a really good sales operation that props it up."
Others argue that regardless of who runs the sales operation, five will struggle to increase its audience and revenue streams. Recent programming, such as the heavily advertised At Home With the Eubanks, is performing solidly but not spectacularly. The first episode pulled in 1.4 million. At 7 per cent, this was marginally up on five's average 6.5 per cent audience share.
On the advertising side, five gets credit for exploiting both spot advertising and other revenue streams such as sponsorship. But some say it may be difficult for five to grow revenue because, unlike ITV or Channel 4, it has no second channel such as ITV2 or E4.
Theakstone says: "It may have reached the top of its game. The dual ownership is not working as well as everybody says but if, like ITV, it gets bought by a big US company this could be good news as there would be more of an onus on big ideas and big budgets."
Both RTL and UBM remain committed to five but if a large offer comes in once the Communications Act is in force from November, the station may pass to different hands. However, this is by no means certain and, in the short term at least, advertisers are waiting to see what Lighting and the programming team led by Chambers can achieve. There have been moves in the right direction but they would like to see further increases in five's programming budget and quality of output.
Future growth of ad revenue will depend on this and the next negotiation season will be an especially vital one for five.