BSkyB has unveiled record operating profits for the nine months to the end of March, up 15% on the year to £660m, as Britain's dominant pay-TV provider added 40,000 net new subscribers in the first three months of 2006, taking its total UK and Ireland subscriber base to 8,099,000. Pre-tax profits for the nine-month period rose 12% to £609m on revenues of £3.079bn, up 9%.
Chief executive James Murdoch said Sky was delivering on its strategic plan. "Our focus during the quarter was to successfully implement our new customer management systems, complete the final preparations for the launch of [high-definition television service] Sky HD, and continue to ready the business for the launch of residential broadband services in the summer.
"Operational achievements in the quarter were outstanding. We achieved our goals, continued to grow our customer base and increased the number of products they choose to take from us," he added.
Sky said the number of households now taking its personal video recorder service Sky+ rose by 149,000 in the quarter to 1.43m, an 86% increase on the year. Multi-room customers—those taking an additional set-top box so they can watch Sky's channels in other parts of the house—rose by 76% on the year to 990,000.
Annualised average revenues per household rose by £10 on the year to £392. Churn, the proportion of direct-to-home customers failing to renew subscriptions, increased by 0.8% on the previous quarter to 11.4%, taking annualised churn for the nine months to the end of March to 11.3%. Sky said it expected churn for the full financial year to be around 11%.
Sky HD will launch in the UK and Ireland on May 22. Sky said there demand for the new service—offering pictures four times sharper than standard definition—had been an "encouraging" since order lines went live last month. Sky HD customers will be able to watch the BBC's live coverage of the 2006 Football World Cup in high definition, broadcast as part of the BBC's year-long HD trial.
Sky said good progress had been made since acquiring broadband provider Easynet in unbundling local BT exchanges. Sky aims to reach a targeted 70% coverage of UK homes by December 2007. Easynet now has its own equipment in 259 BT exchanges and plans to reach around 379 BT exchanges by the end of June, taking the number of homes passed to around 7.5m, or 30% of UK households.
Sky is expected to announce full details of its strategy to deliver programmes via broadband, as well as providing residential telephony and high-speed internet services, later this summer.
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