Sky Deutschland AG announces results for Q1 2010
Q1 Highlights:
Subscription revenues up 20.2% year on year
Subscriber gross additions up 10.1% year on year
12 months rolling churn rate down 1.4 points year on year; quarterly annualized churn
rate now below 20%
ARPU increased further to €28.85 (up €4 year on year)
New triple-play cooperation with cable network operator NetCologne
Q1 2010 key results:
Total revenues of €234.7 million (Q1 2009: €232.7 million)
EBITDA: negative €64.5 million (Q1 2009: negative €29.8 million)
123,000 subscriber gross additions (Q1 2009: 112,000)
Subscriber net growth 1,000 (Q1 2009: negative 28,000)
12 months rolling churn rate declined to 21.0% (Q1 2009: 22.4%)
New innovation initiative:
Sky+: HDTV digital video recorder custom-made for high-value Sky programming
Sky Multiroom: Sky programs can be viewed in multiple rooms at the same time
Three great new Sky HD channels starting in August
Sky Anywhere: television and more on mobile devices, starting with the iPad in May
Munich, 12 May 2010. At the end of March 2010 the total number of subscribers of Sky Deutschland AG was 2.471 million. Gross additions during Q1 were 123,000 which is 10.1 percent above the previous year’s quarter (Q1 2009: 112,000). The rolling churn rate declined further to 21.0 percent in Q1 2010 from 22.4 percent in Q1 2009. The quarterly annualized churn rate is now below 20 percent. Net growth in Q1 2010 was 1,000 subscribers (Q1 2009: negative 28,000). As a consequence of the take up of the new pricing and packaging structure both by new additions and existing subscribers, together with an acceleration in HD take up, ARPU continues its strong growth and increased to €28.85 in Q1 2010 from €24.85 in Q1 2009.
During the first quarter 2010, Sky Deutschland AG increased its total revenues to €234.7 million (Q1 2009: €232.7 million). Subscription revenues increased by 20.2 percent due to the growth in the number of monthly contract subscribers as well as due to a strong increase in the average revenue per user (ARPU). However, this improvement was mostly offset by a reduction in non-recurring and
wholesale revenues from Q1 2009. Costs in Q1 2010 went up to €309.4 million (Q1 2009: €277.4 million) mainly due to higher costs for broadcasting the Bundesliga, other program rights, as well as higher selling expenses due to increased sales and marketing initiatives.
As a result EBITDA for the quarter was negative €64.5 million (Q1 2009: negative €29.8 million) and the loss for Q1 2010 after taxes was €97.0 million (Q1 2009: loss of €80.0 million).
At the end of the quarter net debt amounted to €139.9 million (as per 31.12.2009: €162.4 million).
Operational achievements
In April, Sky Deutschland launched its new marketing campaign with testimonial Moritz Bleibtreu. The target of the campaign is to demonstrate the outstanding quality and value that Sky offers and how Sky provides a better entertainment experience every time people turn on their TV.
On April 1st, Sky Deutschland secured the live pay-TV rights to all games of the Austrian Fußball Bundesliga for Austria, Germany, Switzerland, Italy, Liechtenstein and Luxembourg. With the newly-expanded three-year contract, Sky Deutschland holds the exclusive rights to the Austrian Bundesliga through the 2012/2013 season and will be the only TV broadcaster airing all the games live.
On May 4th, Sky Deutschland announced an initial sales and marketing cooperation with NetCologne, a successful regional cable network operator in Germany. NetCologne will offer Sky subscriptions as part of a bundled triple-play service. This is a new model for cooperation with cable partners and is under discussion with others in the market.
New innovation initiative
Last week Sky Deutschland launched Sky+, a new fully integrated HDTV digital video recorder/receiver, which is optimally tailored to the Sky Deutschland programming. Sky+ possesses numerous functions that provide optimum flexibility and comfort, including one button recording and a unique Series Link capability, meaning Sky customers need never miss their favorite programs again. The device is initially only available for satellite reception; a cable variation is planned for later this year.
Furthermore, Sky Multiroom launches this summer. Sky Multiroom gives customers the possibility to watch different programs in different rooms, even at the same time and for a discounted charge. Sky Multiroom once more reinforces Sky as the most family-friendly entertainment service available in Germany and Austria.
With three exciting new TRUE HD channels – Sky Sport HD2, Sky Cinema Hits HD and Sky Action HD which will begin airing in August - Sky Deutschland will expand the total number of Sky HD channels to ten and shortly thereafter add another, which is still being planned. Sky already has the most comprehensive HD offer in Germany and Austria and is thus extending its lead in top quality TRUE HD programming.
In addition, new and exciting mobile services and applications are planned throughout the year in order to make Sky’s great quality programs available Anywhere and at Anytime, beginning with a new service for the iPad later this month.
Brian Sullivan, CEO of Sky Deutschland AG: “I’m encouraged by the progress shown in these results and I’m excited by the opportunities for Sky in the German and Austrian markets. Much has been achieved in the first nine months since the launch of Sky, but there is still much to do. These new innovations are the next step to add value to our proposition, satisfaction to our customers and further differentiate Sky as the best choice for entertainment in Germany and Austria. Sky Deutschland is the only real premium content broadcaster in the market, leading in sports, movies and High Definition. Our customers deserve better TV and we deliver it to them day in and day out. And we will be introducing even more exciting consumer oriented innovations in the future.”
Note:
Sky Deutschland has slightly modified the reporting structure in order to improve the usability of the reporting and to align internal and external reporting.
Contact for press:
Dr. Hans-Jürgen Croissant
Senior Vice President Communications
Tel.: +49 89/99 58-63 97
hans-juergen.croissant@sky.de
Contact for investors and analysts:
Christine Scheil
Vice President Investor Relations
Tel.: +49 89/99 58-10 10
christine.scheil@sky.de
Q2 2010 results: 13 August 2010, press call at 11:30 am T
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