Virgin profits up, promises 100Mb
October 27, 2010
Virgin Media has announced revenue increased 6.4 per cent year on year in the third quarter to £978 million (€1.11bn) and that it would roll out superfast 100Mb broadband from December with pre-registration for the service opening today.
Virgin Media claims that 13 million homes will have the potential to access the 100Mb service as it is rolled out nationally next year; London, the south-east and Yorkshire will be first. Overall Virgin Media added 14,100 new customers in the third quarter, taking its total subscriber base to 4.78 million. “Triple-play” customers – those taking three products from Virgin – grew to 62.7 per cent of the subscriber base. “Quad-play” customers were 11.5 per cent of the total, up from 10.6 per cent a year ago.
Virgin Media signed up 33,800 new customers to its broadband in the quarter, taking the total number of subscribers to 4.24 million. The company said that more than 700,000 of those now take the 20Mb or 50Mb service, up 41 per cent year on year, and within this more than 90,000 take the 50Mb service, up 24 per cent.
Virgin Media’s TV subscribers increased by 14,800 in the third quarter to 3.77 million customers of which more than half use Virgin’s video-on-demand service. The company has increased its portfolio of high-definition channels from one to 28 in a year, including the addition of Sky Sports and Sky Movies, with 222,100 new customers taking the HD offering in the quarter. Overall Virgin Media has 1.4 million subscribers to HD, a 38 per cent year-on-year increase. It also added more than 100,000 customers taking its Sky premium suite of channels, taking the total to 725,000, including 52,000 who have signed up to Sky Sports HD and, or, Sky Movies HD since launching the channels in August.
Revenue grew by 7 per cent year on year in Virgin’s mobile operation, with contract customer numbers growing 32 per cent year on year to 1.15 million. Operating income doubled from £51 million to £102 million, while average revenue per user grew by 3.7 per cent to £46.38. Operating cash flow (OCF) – broadly equivalent to earnings before interest, tax, depreciation and amortisation (EBITDA) – grew by 11 per cent year on year to £387.3 million.
Virgin Media also made net income of £6.7 million in the third quarter from its 50 per cent stake in UKTV, the pay-TV operator jointly owns with BBC Worldwide. In the year to date Virgin has made £20.2 million from its stake in UKTV, which it is trying to sell. Virgin values the stake at £349 million, including its loans to fund its operation of £113 million.