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December 21, 2007 |
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AUSTAR UNITED: Posts AU$46 Million EBITDA for 3rd Quarter Austar United Communications released its unaudited results for the third quarter, ended September 30, 2007, demonstrating exceptional growth in both financial and operational metrics. For the three months ended September 30, 2007: * Revenue increased 13% to AU$145 million; * Gross margin increased 11% to AU$79 million; * EBITDA increased 33% to AU$46 million; * Net gain of 18,959 subscribers; * Total residential television ARPU up 2.5% to AU$76.33; and * Quarterly churn down 0.05% to 1.10%. AUSTAR continued to attract new customers in regional Australia, with total television subscribers increasing by 18,959 to 658,087 for the quarter. ARPU increased 2.5 percent to AU$76.33 compared with the same period last year. Churn, meanwhile, dropped to one of its lowest levels in over five years, to just 1.10%. Chief Executive Officer, John Porter, said: "Three consecutive quarters of over 18,000 customer additions demonstrates strong and sustainable growth; not only are we attracting new customers but our current base is clearly with us for the long term. "We recognize that continuous innovation and improvement are key elements to ensuring our customers stay satisfied," he continued. "In the fourth quarter we will introduce three new channels to the service: premium drama channel, Showcase, international sports provider, Setanta, and the national indigenous channel, NITV." Earnings before interest, taxation, depreciation and amortization (EBITDA) for the three months increased by 33% to AU$46 million compared to the previous corresponding period, reflecting an 11 percent increase in gross margin to AU$32 million. Mr. Porter continued, "Disciplined cost control has long been a key part of AUSTAR’s business strategy. Our ability to acquire new subscribers using more cost-effective channels such as online, as well as our use of technology to drive down service costs, has resulted in a significant decrease in operating expenses for the quarter. We expect to keep operating expense growth on par with, or below, CPI for 2007." Profit before interest, tax and significant items was AU$26 million for the three months, a 23 percent increase on the same period in 2006. The 27 percent increase in capital expenditure for the quarter reflects continued investment in future earnings with the majority of expenditure relating to subscriber growth, upgrades to satellite equipment and pre- purchase of MyStar boxes prior to its launch later this year. Operating cashflow for the 9 months ending September 30 was up 16 percent to AU$98 million. AUSTAR has meanwhile recently announced an historic arrangement with each of its commercial network colleagues, which will give MyStar customers all the benefits of the digital experience for their local commercial channels as well as their AUSTAR channels. Mr. Porter said, "Australia’s free-to-air networks will provide information for MyStar’s digital Electronic Program Guide, meaning that for the first time, customers who subscribe to MyStar will be able to enjoy its technical benefits, such as one-touch record, live-pause and playback, with their local free-to-air channels. We genuinely value our relationship with each of these channels, and look forward to a long working relationship with them. "As a direct result of this agreement, regional Australians will have the ability to view their local, free-to-air digital channels seamlessly with their AUSTAR." About Austar United New South Wales, Australia-based Austar United Communications Limited -- http://www.austarunited.com.au/ -- is a subscription television provider, offering primarily digital satellite services to customers in regional and rural areas in Australia. AUSTAR also offers dial-up Internet and mobile phone services. The company has two business segments: Subscription services and Radio spectrum licenses. Subscription services represent subscription television distribution operations, Internet, interactive television and mobile telephony operations and license fee income. Radio spectrum licenses represent income and gains earned from the leasing of radio spectrum licenses. As of September 30, 2006, the company had a net debt standing of AU$486.4 million. The Troubled Company Reporter-Asia Pacific, on December 14, 2007, included in its "Large Companies With Insolvent Balance Sheets" Column, Austar United Communications Ltd., with US$411.16 million in assets and US$43.72 million in stockholders' equity deficit. |
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