Virgin Media has said that it expects its TV net additions to be roughly flat in the second quarter of 2007, revising its previous forecast for negative TV subscriber growth following the removal of Sky’s basic channel package from Virgin’s platform.
Virgin has said that this new prediction is due in significant part to the wide ranging mitigating actions it has taken. It said that the company had benefited from “reinvigorated communications and marketing, growing customer recognition of the value of our video-on-demand content and the inherent appeal of the new Virgin Media brand.”
Sir Richard Branson’s company expects that a series of new and competitive consumer propositions “exploiting Virgin Media’s unique quad-play capability” will help to drive new fixed line telephony and overall subscriber additions.
As a result, whilst it continues to anticipate negative telephony and overall net additions in the second quarter, Virgin Media expects a return to subscriber growth in the second half of the year.
Virgin Media’s total revenue for the first quarter of 2007 was £1 million, with the company saying that the majority of the decline from the previous quarter was due to a reduction in content segment revenue.
The cable company’s revenues from its consumer cable operations were £637.3 million in the first quarter, up year on year from £636.7 million.
However, its profitability deteriorated owing to decreasing revenues from the business cable, mobile and content areas of its business.
Virgin Media made an operating loss of £15.3 million in the first quarter, compared with an operating profit of £9.2 million in the last quarter of 2006.
The company’s net loss for the first three months of the year was £120.3 million compared with a net loss of £119.9 million in the first quarter of 2006.
Despite a £25 million rebranding campaign, the group’s customer base dropped to 4.81 million with a net loss of 46,900 subscribers (see Virgin Media Releases First Quarter Results).
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