Sky defies sceptics with Q1 growth

BSkyB has managed to defy continued downward economic pressure on consumer spending to beat analysts’ expectations in its latest quarterly results.

The UK sat caster added 760,000 new paid-for subscription products in its fiscal first quarter, 8% more than the previous quarter, and added 51,000 new retail customers to close the quarter at 11.5 million.

The pay TV broadcaster added 46,000 new TV customers and 462,000 new TV products, the latter number being boosted by strong demand for the Sky Go Extra product. Sky now has six million connected TV customers. The number of On Demand downloads more than trebled to 257 million in the quarter, fuelled by sales of TV box sets.

Sky said its electronic sell-through revenues via Sky Store more than doubled year-on-year, while OTT TV service Now TV tripled its subscriber base.

Sky added 300,000 home communications sales during the quarter, with its broadband base rising by 75,000.

Sky grew its revenues by 6% to £1.926 billion for the quarter, while operating profit grew by 11% to £316 million.

“We have made a strong start to the year. After a year of investment, we are seeing the returns coming through with good top-line growth of 6% translating into an 11% increase in profits.This strong financial performance was fuelled by continued operating momentum. We are seeing broad customer demand for our products whilst opening up new revenue opportunities. In all, we added 760,000 new paid-for products, 8% more than the previous quarter,” said CEO Jeremy Darroch.

“The investments that we have made in new connected TV services are delivering growing benefits to our business. We extended our lead as the UK’s largest connected TV platform, surpassing six million connected homes. Sky Store more than doubled its revenues and our mobile TV service Sky Go Extra achieved a record quarter of growth.

“The benefits are clear as connected customers watch more TV, spend more with us and are more loyal. Three months into the year, we are delivering against a clear strategy for growth in our existing business. At the same time, we are making good progress with our proposed acquisition of Sky Italia and a majority stake in Sky Deutschland.”