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LONDON -- BSkyB chief executive Jeremy Darroch said Thursday the satcaster had delivered its highest fourth quarter subscriber growth in five years, adding 124,000 net new subscribers in the three months to the end of June 2009, compared to 94,000 at the same stage last year.

Despite describing the ongoing economic climate as "challenging," the U.K.'s dominant pay operator appeared to shrug off the recessionary gloom that has engulfed other media stocks, announcing full-year revenues up 7% to £5.4 billion ($8.9 billion) and net profit of £259 million ($427.6 million) compared to a loss of £127 million last year.

The results, which came in ahead of analyst consensus of between 86,000 and 94,000 new subscribers, mean that the News Corp.-controlled group has a total of 9.4 million subscribers, compared to its nearest U.K. TV rival Virgin Media, which has 3.6 million subscribers and IPTV service BT Vision, with 500,000 users.

The results put Sky on track to achieve its target of 10 million subscribers by the end of 2010.

Traditionally the summer months are BSkyB's weakest quarter, but Darroch said the strong fourth quarter performance was driven by customers attracted to Sky's High Definition and PVR service, which has attracted 543,000 subscribers since the beginning of the year, many of whom traded up from cheaper packages to the new HD serivice.

Sky+, BSkyB's PVR service, is now in 5.5 million homes, 58% of the total subscriber base.

Despite the recessionary environment and fears that job losses would force subscribers to slash spending, Darroch pointed out that churn rates -- the number of subscribers who cancel their service annually, had fallen to 9.9% from 10.2% at the same stage last year.

"It has been a strong finish to a strong year of growth," Darroch said on a conference call. "In a tough economic environment customers are turning to Sky."

Analysts also welcomed the performance.

"While expectations were high going into the results, key operational metrics were well ahead of even the top of the range forecasts," said Daniel Kerven, analyst at UBS Media, in an investment note.

"Sky delivered the strongest full-year growth of 465,000 new subscribers for five years despite the economic headwinds -- testimony to its structural growth."
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