BSkyB Posts Record Financial Results

LONDON: Full-year operating profit at BSkyB reached a record £1.3 billion ($2 billion), up 9 percent from a then-record of £1.2 billion ($1.86 billion) in the prior fiscal year.

Revenue for the year ended June 30, 2013 rose 7 percent, to £7.2 billion ($11.08 billion). EBITDA was up 8 percent, at £1.7 billion ($2.6 billion).

The British pay-TV giant added 34,000 TV subscribers in the latest quarter, compared with 20,000 TV sub additions in the year-ago period. Existing customers upgraded to new services at a rapid rate. There was 170-percent growth in Internet-connected Sky+HD boxes, to 2.7 million; a 19-percent increase in Sky Go users, to 3.3 million; a fivefold increase in On Demand downloads; and 200-percent growth in Sky Store video rentals. BSkyB’s new NOW TV sports day pass had more than 50,000 individual users purchase a pass in the first three months.

Looking ahead, BSkyB said it wants to extend leadership in core areas such as original British drama and Sky Sports, but also to accelerate the take-up and usage of new services, which this year saw a strong response from customers.

Jeremy Darroch, the chief executive of BSkyB, commented: “We have had another very good year of growth, with revenues up 7 percent, operating profit up 9 percent and earnings per share up 18 percent. The strength of our financial performance is a result of our successful transition to more broadly-based growth and sustained investment to create a better service and wider range of products for customers.

“On the back of this performance, we are increasing returns to shareholders with the ninth consecutive rise in the ordinary dividend and we intend to seek approval for a further £500 million of share repurchases.

“Over the course of the year, we added more than three million new paid-for subscription products. We finished the year strongly with 11 percent organic growth in product sales for the fourth quarter, reflecting good demand in all areas. It was a particularly significant quarter for home communications as good organic growth, combined with the consolidation of the consumer broadband and fixed-line telephony business acquired from O2, delivered well over a million product additions.

“In our television business, there has been an excellent response from customers to our new services. We’ve seen an explosion in on-demand and mobile viewing as more people connect their Sky boxes to broadband and watch TV on laptops and mobile devices with Sky Go. Sky Go Extra, our new subscription service, has already attracted more than 150,000 customers in just five months. Customers tell us they get huge value from these services. The benefits to our business are equally strong through take-up of higher-tier packages, expanded revenue opportunities and improved customer satisfaction. We see an exciting opportunity for future growth in this area and we intend to increase investment over the next year to accelerate growth and returns from these new services.

“We expect the consumer environment to remain challenging over the coming twelve months. Against that backdrop, we have a strong set of plans that will extend our leadership in core areas – on screen, in home communications and in front-line service delivery; accelerate growth in new services; and improve efficiency to build a bigger, more profitable business for shareholders.”