Liberty Media entertainment group up in Q2
Company says Starz lost subscribers amid recessionNEW YORK -- Liberty Media has reported improved second-quarter results at its Liberty Entertainment Group driven by strength at Starz Entertainment and said declines at home-shopping network QVC were less severe than in recent quarters.
But Starz lost 3% of its subscribers compared with the first quarter in another sign that consumers are reconsidering their subscriptions to premium channels amid the recession. Last week, satellite TV giant DirecTV said it has seen increasing weakness in premium services.
Overall, Liberty management seemed content with financial trends in the second quarter.
"During the quarter, we experienced strong operating results at Starz and our eCommerce companies and improved financial performance at QVC," Liberty president and CEO Greg Maffei said Friday.
Asked about the outlook for satellite radio firm Sirius XM Radio, in which Liberty early this year took a 40% stake in return for a $530 million loan, Maffei during a conference call called Sirius "a great business" and said it seems to have hit bottom and is poised for a rebound.
"You'd be hard-pressed to find a media company out there that is growing at the rate (it) is growing," he said.
For the second quarter, Liberty Entertainment posted adjusted operating income before depreciation and amortization of $89 million, up 44% over the year-ago period despite expenses related to the planned merger of Liberty Entertainment with DirecTV. Revenue rose 2% to $367 million, primarily driven by gains at Starz Entertainment.
Starz's quarterly adjusted OIBDA jumped 54% on an 8% revenue improvement on rate increases and growth in the average number of subscription units. Starz saw an average subscription unit gain of 5%, while Encore essentially was flat.
Meanwhile, Liberty Interactive, which houses QVC, posted a 1% revenue decline but slight gain in adjusted OIBDA.
QVC's second-quarter revenue and adjusted OIBDA each dropped 4%.
"Although we still have some hard work ahead of us, we see this improved sequential performance as a positive indication that we are on the right course with our product and programming initiatives and that our productivity and cost-control initiatives have taken hold," QVC president and CEO Mike George said.