Satellite heavyweight, BSkyB, has announced very positive interim results for the second quarter of 2004, revealing 192,000 new subscribers in the six months to December 31; bringing it closer to reaching its 8 million subscriber target by the end of 2005.
Total revenue for Group has seen an increase of 10%, taking it to £1,945 million and profit, after tax, also jumped by 18%, seeing a total of £154 million. Sky also reported a 25% increase in year on year operating profit, taking it to £354 million, and a 44% increase in earnings per share to 12.1 pence.
Today’s interim results reveal a strong performance for Sky’s premier entertainment package, Sky+, with the PVR technology penetrating 642,000 households, an increase of 168,000 in the quarter. Elsewhere, Sky also saw multiroom households increase by 116,000 in the quarter to 473,000.
The company attributes its strong performance in the second quarter of 2004 to a new marketing drive offering lower introductory packages to new subscribers as well as selling subscriptions through mainstream retailers, such as Tesco Group and Woolworths. An aggressive advertising and promotional campaign in the run-up to Christmas also contributed to the growth.
Commenting on the results, James Murdoch, chief executive said: “The business delivered a strong set of financial results in the first half of the year with good sales and profit growth. During the quarter, we launched a number of important initiatives consistent with the long-term growth strategy we outlined in August 2004 (see Sky Profits Rocket Despite Slowing Subscriber Rates).”
He continued: “We have a full programme of work ahead of us in 2005, including the continued roll-out of our segmentation project and implementation of our new customer management systems. We will continue to develop these and other initiative in pursuit of our long term strategic goals and targets.”
The broadcaster also forecast that its average revenue per user (ARPU) would rise to around £400 by the end of 2005. During a conference call with investors Murdoch said: ” On ARPU, we think we’ll continue towards the 400 stg target and we’ll be there or thereabouts by the end of the calendar year. After that it’s hard to predict due to the future mix of products and customers. We’ll continue to report ARPU, but won’t be benchmarking it against a particular target.”
Murdoch reiterated his goal of 10 million subscribers by 2010 and said the Sky remains “on track” to hit its immediate goal of 8 million ‘Direct-to-Home’ subscribers by the end of the current calendar year.
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