Virgin Media celebrates its first £1bn quarter

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The Independent Online

Virgin Media's chief executive Neil Berkett hailed a "year of great achievement" as it recorded its highest ever annual revenues and bust through the £1bn mark in one quarter for the first time.

Yet the euphoria was slightly tempered as the company revealed the growth of new customers was lower than expected and it is no closer to bringing Sky Atlantic, the new drama channel with acclaimed US shows such as Boardwalk Empire, to Virgin Media subscribers. He said: "At the moment we do not believe it is worth the money they want for it."

In its annual results statement, Virgin posted an almost 6 per cent rise in revenues for 2010. In the last three months of the year, revenues hit £1bn, up 6.6 per cent on the corresponding period in 2009. Mr Berkett said the strong numbers followed the "execution of a strategy launched in 2007".

The performance was boosted by a rise in its customers paying for additional services or subscribing to a higher tier of those services. The average revenues per user rose almost 5 per cent in the last three months of the year to a record £47.51.

Steve Malcolm, an analyst at Evolution Securities, said the results "highlighted the virtues of the company's premium broadband position in the market".

"We are the undisputed leader in broadband," Mr Berkett said as the new customers took the company past the four million mark for the first time. Virgin said demand for its superfast services was driven by the "explosion in data consumption".

The company carries over half a terabit of data per second during busy periods, equivalent to 62 copies of the Encyclopaedia Britannica every second. Virgin is rolling out broadband with speeds of 100Mb and hopes to offer the superfast service to all its customers next year.

Yet Mr Berkett admitted that the level of customer growth had been "modest".