BSkyB bucks trend in economic crisis
Satcaster adds subscribers, reports revenue increaseLONDON -- Satcaster BSkyB appears to be bucking the economic crisis consuming its rivals, announcing net profit of £169 million ($251 million) for the nine months ending March 31 on revenue up £290 million ($432 million) to £4 billion ($5.9 billion) over the same period.
Driven by sports and movie content and technical innovation, BSkyB said Thursday that it added 80,000 net subscribers in the three months to the end of March. Sales momentum grew on the back of a new low-cost, high-definition box, which costs $73 per unit during the period compared to its earlier price tag of $222.
More than one million of Sky's 9.3 million subscribers now have the Sky+HD box, which also offers PVR capability, while more than 5 million have a PVR box, chief executive Jeremy Darroch said. Those subscriber levels helped the satcaster to a "strong start to calendar 2009" despite "difficult times."
With customer additions well ahead of the 50,000-60,000 range analysts had been forecasting, Sky shares traded up more than 6% on the news, rising to 495 pence in early trading despite overall gloomy trading in London.
Earnings before depreciation, amortization and taxation totaled £833 million ($1.24 billion), compared with £684 million ($1.01 billion) for the first nine months of 2008.
Program costs, including news, sports rights, TV series and movies, totaled £1.3 billion ($1.9 billion) compared with £1.2 billion ($1.8 billion) for the year-earlier period.
Sky recently pulled out of the bidding for Tiscali, the broadband Internet and television operator that owns the Homechoice on-demand television platform, but Darroch said on an investor call that while market conditions for 2009 "remained challenging," the satcaster was still looking for growth opportunities.
"We don't sit here feeling a need to make any acquisitions. If opportunities come up that we feel would accelerate our pathway we would consider them," Darroch said. "In difficult times, customers are making careful choices and responding to the combination of quality and value that we offer."