Sky TV posts $103m profit, up from $35m

Pay television company Sky Network TV today posted a June year net profit of $103.4 million against $35.3 million a year earlier.

The profit beat analysts' forecast of $98.6m.

Total revenue for the News Corp-controlled company, which recently merged with Independent Newspapers, rose 11 per cent to $489.4m.

Ebitda (earnings before interest, tax, depreciation and amortisation) increased by 23.1 per cent to $230.5m.

Earnings per share rose 27 cps from 9 cps.

Tax provided rose 125 per cent to $26.9m.

Chief executive John Fellet said the company had experienced improvements across all key areas including growth in subscriber numbers, average revenue earned per subscriber while also cutting operating expenses relative to revenue.

The subscriber base reached a new high of 619,168, up 42,566 over the previous year. The numbers comprise 523,039 residential digital subscribers (85.9 per cent), 77,762 residential UHF subscribers (12.6 per cent) and 9367 (1.5 per cent) commercial and other subscribers.

Sky is now in 39.7 per cent of New Zealand homes.

Churn, the way subscribers who disconnect from Sky is measured, continued to fall from 17.1 per cent in 2004 to 15.8 per cent.

Sky also released the results for INL.

It had announced a consolidated net profit after tax of $59.6m, down 15.9 per cent on 2004.

INL was a holding company that owned 78.3 per cent of Sky and had net cash reserves of $275m at June 30.

The merger of INL and its subsidiary Sky was implemented on July 1.

Under the scheme, INL shareholders received 0.836 of a share in a new company, MergeCo, and $1.78 in cash in exchange for each INL share. Sky shareholders, other than INL, received one share in MergeCo and $1.28 in cash for each Sky share held.

This resulted in MergeCo issuing 389,139,785 shares, the same number on issue by Sky prior to the merger. MergeCo's name was then changed to Sky Network Television Ltd.

The results today do not reflect the merger.

Rupert Murdoch's News Corp owns 44 per cent of the merged company.

Sky TV shares closed on $5.95 yesterday.

- NZPA