HD customers boost BSkyB profits
Satellite broadcaster BSkyB today said nearly half a million customers had signed up for high-definition TV in the past three months as it reaped the benefits of a pre-Christmas marketing push.
The group's 482,000 net customer additions in the quarter to December 31 takes households on Sky+HD past the two million mark after adding 1.3 million in the past year.
Chief executive Jeremy Darroch said HD provided the "standout performance" as the group lifted underlying profits 4% to £401 million in the first half of the year.
"It has been another good quarter in what remains a tough environment," Mr Darroch added.
BSkyB has benefited as more households opt for home entertainment in the recession, with its total customer base now reaching 9.7 million.
Nearly a fifth of its customers are now taking broadband and telephone services as well as television channels.
This pushed revenues per user to £492 from £444 in the same quarter a year earlier, as well as increasing loyalty.
Its rate of customer churn - measuring customers leaving Sky - was 9.6 per cent, 0.3 percentage points down on a year earlier.
While the company said the economic outlook remained "uncertain" for 2010, it began the year in a "good position".
It is also pushing into new technology with the launch of Europe's first-ever 3D television channel in April.
Next Sunday's Premier League clash between Arsenal and Manchester United will be broadcast in 3D, which will be made available to all HD+ customers as the availability of 3D televisions increases.
Mr Darroch said the firm was still weighing up its options after the Court of Appeal last week stood by the Government's decision to force the firm to reduce its controversial 17.9 per cent stake in ITV to 7.5 per cent.
BSkyB originally spent £940 million on the stake but ITV's shares have plunged and the group wrote off another £59 million on the investment in the six months to December 31.
The business is also facing a review by regulator Ofcom which could see it forced to cut wholesale prices on sports rights for other broadcasters. The review should conclude at the end of March.
Mr Darroch added: "All of our prices - wholesale and retail - are outstanding value for the investments we have made."
Shares in BSkyB rose 3 per cent following the strong customer growth.
Numis analyst Lorna Tilbian said: "In our preview note we highlighted the heavy marketing for HD in the second quarter and indicated that we viewed our 313,000 estimate as conservative.
"Even allowing for this, we view the 482,000 additions delivered today as an outstanding operational performance."
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