Ann: HALFYR: SKT: SKY TV Announces 2013 Interim R

• Release Date: 22/02/13 11:44
• Summary: HALFYR: SKT: SKY TV Announces 2013 Interim Result
• Price Sensitive: No
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SKT
22/02/2013 09:44
HALFYR

REL: 0944 HRS Sky Network Television Limited

HALFYR: SKT: SKY TV Announces 2013 Interim Result

This report has been prepared in a manner which complies with New Zealand
International Financial Reporting Standards and gives a true and fair view of
the matters to which the report relates and is based on unaudited financial
statements.

CONSOLIDATED STATEMENT OF FINANCIAL PERFORMANCE

Current Full year NZ$'000; Up/Down %; Previous Corresponding Full year
NZ$'000

Trading revenue: 443,346; Up 3.9%; 426,862

Total Operating Revenue: 443,346; Up 3.9%; 426,862

OPERATING SURPLUS BEFORE TAXATION: 93,657; Up 6.3%; 88,082

Less taxation on operating profit: 26,298; Up 3.6%; 25,380

NET SURPLUS: 67,359; Up 7.4%; 62,702

Earnings per share: 17.53 cps; 16.08 cps

SKY has reported $67.4 million in after- tax earnings, a 7.4% increase on the
previous period. Revenues are up 3.9% to $443.3 million and earnings before
interest, tax and depreciation (EBITDA) increased by 4.2% to $177.2 million.

This improved financial position is primarily due to the continued success of
the MY SKY HDi decoders and an increase in average revenue per subscriber
(ARPU). The increase in ARPU is mainly the result of SKY customers upgrading
to new services such as MY SKY HD or to premium channels such as SOHO.

Advertising revenue was down 9.5% for the six month period ending 31 December
2012 compared to the same period ending 31 December 2011. This is due to
advertising sales being unusually high in the prior period attributable to
Rugby World Cup advertising which was not repeated in the current year.

Installation revenue has decreased by $3.1 million from the previous period
primarily due to promotions including free installation to new subscribers.

MY SKY subscribers now represent 51.2% of SKY's satellite subscriber base
compared to 40.1% in the previous period. At 31 December 2012, SKY had
423,973 MY SKY subscribers compared to 331,041 in December 2011, a
significant increase of 28.1%. Subscribers continue to find great value in
the MY SKY product which is demonstrated by strong sales and increasing
penetration despite the current economic environment.

Gross churn for the period ending 31 December 2012 was 14.6% up slightly from
14.2% from the previous period. MY SKY HDi continues to deliver churn
benefits. For  the rolling 12 months to 31 December 2012, the gross churn for
 MY SKY HDi  was 10.9% compared to the churn rate of 18.1% for subscribers on
the standard digital decoder during this period.  This compares to gross
churn for MYSKY of 10.4% and a churn rate for subscribers on the standard
digital decoders of 16.3% in the comparative period.

Taking a closer look at SKY's financial results, you will note a 7.0%
increase in DBS (satellite) subscription revenues compared to the comparative
period. This can be attributed largely to a 5.5% increase in ARPU to $75.78
from $71.81.

SKY's operating costs (excluding depreciation) for the six months to 31
December 2012 increased by $9.4 million, or 3.7%. Programming costs which
comprise both the costs of purchasing programme rights and also programme
operating costs increased by $15.1 million (11.1%). This can be mainly
attributed to the cost of the Summer Olympics. This was compensated by a
decline in sales and marketing costs of $7.1 million.  Sales and marketing
costs were unusually high in the previous comparative period because of the
Rugby World Cup and the duration of this marketing campaign.  Sales and
marketing costs for the six- month period January 2012 to June 2012 were
$15.8 million compared with $16.5 million in the current period.

SKY decreased its capital expenditure during the six months to $42.8 million
from $69.6 million in the comparative period, a decrease of $26.8 million.
This is mainly due to a combined decrease in decoder costs and installation
costs of $20.6 million.

Dividends

The Board of Directors has considered the performance of the business over
the last six months and its prospects for the full year and announced on 22
February 2013 that it will pay an increased  fully imputed dividend of 12
cents per share (prior interim dividend 11 cents) with the record date being
8 March 2013. A supplementary dividend of 2.1176 cents per share will also be
paid to non-resident shareholders
End CA:00233312 For:SKT    Type:HALFYR     Time:2013-02-22 09:44:19