DirecTV LatAm: “Our biggest growth engine”
May 10, 2012
As well as posting solid results (revenue up 12 per cent) for its overall pay-TV business, DirecTV’s management stated on an analysts call that its Latin American division is now the broadcaster’s “biggest growth engine” adding more net subscriber growth than the North American parent business.
“Our Latin America business has quickly become our biggest growth engine and continues to demonstrate outstanding growth momentum. For the first time ever, gross additions not only exceeded those posted by our US business in the quarter, but they also surpassed the 1 million subscriber mark, achieving yet another major milestone,” stated Mike White, DirecTV’s CEO.
“The majority of our year-over-year subscriber growth came from PanAmericana this quarter, where our net additions nearly doubled,” he continued. “This tremendous performance was driven by strong contributions from our prepaid offerings, along with the healthy postpaid gains in Colombia, Argentina and Venezuela. I might point out the Colombia market is a key part of our growth strategy in PanAmericana and although it’s early days in this opportunity, I’m delighted to see the results are running even better than Bruce [Churchill’s] very aggressive plan for that country.”
White confirmed that its North American Q2 expectations were for slower growth, although churn was down (from 1.52 to 1.44 per month) and ARPU up. It added 81,000 net new US subs during Q! And this was fewer than most expected. DirecTV said it was toughening up its credit policies and was seeking “higher quality” subscribers. Overall, there was clearly some pressure on the operation, given that its operating margin fell from last year’s 34.5 per cent to Q1’s 31.5 per cent. DirecTV had 19.97 million subs, as at March 31st.