Sub gains narrow Cablevision loss
Revenue up 13.4%; Dolan mum on going privateCablevision Systems on Wednesday reported a narrowed third-quarter loss on continued advanced-services customer gains and the 10th consecutive quarter of basic-subscriber growth.
In a conference call with analysts, management declined further comment on a recent bid by the Dolan family, which controls Cablevision, to take the company private.
Asked about the future of the company's Rainbow networks unit, for which management previously said it is reviewing strategic alternatives, president and CEO James Dolan said there was "nothing new to report" at this time. He added the company continues to look at its options but feels Rainbow is "very important" to its overall strategy.
For its third quarter, Cablevision reported a loss of $59.2 million, down from the $62.9 million loss recorded in a year ago. Revenue increased 13.4% to $1.4 billion.
The company added about 9,750 basic-cable subscribers in the latest quarter. Cablevision's digital-video customer figure rose 93,587 in the quarter, its broadband user number 72,438, and its telephony subscriber base is 113,086.
Overall, revenue-generating units rose 288,139, or 3.5%, in the third quarter.
"This led to our core cable business enjoying its highest year-over-year quarterly gain in net revenue since the company began offering its full suite of digital products in 2004," Dolan said. Cable revenue jumped 18.7% to $1 billion, with operating income up 19.1% to $174.6 million. Average monthly revenue per basic video customer rose from $96.69 a year ago to $111.13.
Management said Cablevision's triple-play bundle customers — who get video, Web and telephony service from the firm — continue to get the bundle at a discount two years after its launch even though initial expectations were that prices would rise after 24 months.
Rainbow's financials were mixed as revenue rose 3.1% to $217 million, but operating income fell 23.1% to $15.2 million. The company cited a carriage contract dispute last year that delayed some revenue from the second into the third quarter. It also said that its Voom HD Networks brought in higher revenue, but also unspecified higher losses.
Cablevision also reaffirmed its full-year 2006 guidance for basic-video user growth of 3.5%-4% and overall revenue gains in the high-teens percentage range.
Cablevision shares closed down fractionally Wednesday at $27.91.