3rd Nov 2006 07:01
British Sky Broadcasting Group PLC03 November 2006 3 November 2006 BRITISH SKY BROADCASTING GROUP PLC Results for the three months ended 30 September 2006 BSkyB announces strong first quarter net subscriber growth and substantial demand for Sky Broadband Further strong growth in Television • DTH subscribers increased to 8.258 million, net growth of 82,000 in the quarter • Sky+ households increased by 139,000 in the quarter to 1,692,000, 20% penetration of total DTH subscribers • Multiroom households increased by 46,000 in the quarter to 1,093,000, 13% penetration of total DTH subscribers • HD households increased to 96,000, net growth of 58,000 in the quarter Strong progress since the launch of Residential Broadband and Telephony (1) • Substantial demand from Sky customers with around one million registrations • Successful use of pre-registration to proactively manage demand • 74,000 customers connected, with over 20,000 orders every week • 540 local exchanges unbundled - 36% of UK homes passed, with 25 exchanges now being unbundled every week • 49,000 customers signed up to Sky Talk's £5 per month anytime calls package taking the total Sky Talk customer base to 204,000 Continued strong financial performance • Revenue increased by 11% to £1,071 million • EBITDA, excluding Easynet and the impact of Residential Broadband (£34 million), increased by 8% to £258 million • Operating profit including Easynet and the impact of Residential Broadband of £180 million, an operating margin of 17% • Operating profit, excluding Easynet and the impact of Residential Broadband (£42 million), increased by 3% to £222 million, a margin of 22% • Basic earnings per share of 6.5 pence; adjusted earnings per share of 6.3 pence James Murdoch, Chief Executive said: "This has been an important period for the company. We are building on ourleadership in pay television and are becoming an increasingly well positionedchallenger in the £20 billion combined industry for pay television, broadbandand telephone services. Sky has delivered the highest first quarter subscribergrowth for three years and is seeing high demand across our range of services.One in three families in the UK and Republic of Ireland are choosing Sky for thewidest choice in television and now almost a quarter of those families take atleast one additional product from us as well. While it is still early, we arepleased with the progress since the launch of Sky Broadband and in just 15weeks, we've seen a great response from Sky customers. Our preparations, paceof provisioning and investments in service and systems to manage demand areperforming well. Our strategy is leading to an increase in revenue growth with overall revenuesup 11% in the quarter. Our expansion into new areas is supported by continuedgrowth and strong financial performance with pay television EBITDA up 8% in thequarter. A wide choice of quality programmes, innovative services like HDTV, Sky+, andbroadband are not only attracting new customers, but also offering new servicesto existing customers. There's never been a better time to join in." --------------- (1) Residential Broadband and Telephony data as at 31 October 2006 Enquiries: Analysts/Investors: Andrew Griffith Tel: 020 7705 3118Robert Kingston Tel: 020 7705 3726 E-mail: investor-relations@bskyb.com Press: Matthew Anderson Tel: 020 7705 3267Robert Fraser Tel: 020 7705 3036 E-mail: corporate.communications@bskyb.com Finsbury: Alice Macandrew Tel: 020 7251 3801 A conference call for UK and European analysts and investors will be held at 8:30 a.m. (GMT) today. To register for this, please contact Silvana Marsh atFinsbury on +44 20 7251 3801. A live webcast of this call and replay facilitywill be available on Sky's corporate website, http://www.sky.com/corporate. There will be a separate conference call for US analysts and investors at 10.00 a.m. (EST) today. Details of this call have been sent to US institutions and can be obtained from Dana Johnson at Taylor Rafferty on +1 212 889 4350. A live webcast of this call and replay facility will also be available on Sky'scorporate website, http://www.sky.com/corporate. OVERVIEW Demand for Sky's combination of services was strong. Sales of new Sky DTHsubscriptions ("gross additions") were 14% higher than the three months toSeptember 2005 ("the comparable period"); Sky+ sales continue to exceedexpectations, with over one in five customers choosing the product; Sky HD hasdemonstrated the fastest customer take-up for an additional Sky product; over20,000 Sky Broadband orders are being processed every week; and Sky Talkrecorded its highest rate of customer growth for over two years. Sky Broadband has made an encouraging start. The Group adopted a controlledapproach to customer provisioning, which ensured a process that was bothefficient for the customer and economic for the Group. As at 31 October 2006,there had been around one million registrations of interest and 74,000 customerswere connected to the service, of which 88% were within Sky's network; 204,000customers took the Sky Talk telephony service. Total revenue for the three months to September 2006 ("the quarter") increasedby 11% to £1,071 million, with operating costs at £891 million. Total operatingprofit for the quarter was £180 million; excluding the consolidation of Easynetand the impact of Residential Broadband, operating profit increased by 3% to£222 million. Profit after tax for the quarter was £116 million. OPERATING REVIEW Television At 30 September 2006, the total number of direct-to-home ("DTH") digitalsatellite subscribers in the UK and Ireland was 8,258,000, representing a netincrease of 82,000 in the quarter and the highest first quarter net subscribergrowth since 2003. Strong demand for Sky's broad range of products led to an increase in grossadditions of 14% on the comparable period to 325,000; gross additions were 34%higher than those recorded in the three months to September 2004. Sky+ continues to exceed expectations, with over 20% of all Sky households nowtaking the product. At 30 September 2006, the number of households subscribingto Sky+ was 1,692,000, an increase of 139,000. During the quarter, the Groupreduced the price of Sky+ for existing customers, removing the necessity to takea Multiroom subscription, and thereby allowing them to upgrade at the sameattractive rates as new joiners. Multiroom households increased by 46,000 in thequarter to 1,093,000, representing 13% penetration of total DTH subscribers. Sky HD subscribers more than doubled during the quarter to 96,000, the fastestever customer take-up of an additional Sky product, and already representingthree times the sales levels achieved by Sky+ in its first year. As a consequence of this strong demand across all products, the range of monthlysubscriptions and price points has continued to broaden. Over the last twoyears, the Group has expanded its use of entry level price points and hasextended pricing options at the premium end. The addition of broadband andtelephony services will allow this subscription range to broaden further,providing more choice for new and existing customers. Annualised average revenue per DTH subscriber ("ARPU") for the quarter was £385,a £6 decrease on £391 recorded for the previous quarter(2). This reductionprimarily reflects a £5 decrease from a number of one-off and phasing items:one-off reduction in 'a la carte' revenues following Film4's re-launch as asubscription free channel; reduced pay-per-view revenues partially attributableto the timing of boxing and wrestling events; and an adverse foreign exchangemovement on Irish subscription revenues. The remaining £1 reduction was due tothe success of a number of short-term promotional offers, partially offset bythe initial effects from the recent change in retail pricing on 1 September. TheGroup expects ARPU to grow during the year, reflecting the full benefit of theretail price rise, increased new product penetration and the greater use ofbroadband and telephony in the promotional mix, rather than short-term, pricedriven, promotional offers on viewing packages, particularly in relation tochurn. DTH churn for the quarter (annualised) was 11.8%, 0.1 percentage points higherthan the comparable period. The first quarter of the financial yeartraditionally experiences high churn levels, reflecting the effects of theretail price increase and, this year, a lower level of natural reinstates. The Group continued to expand its range and quality of programming during thequarter. Sky Sports recently announced a number of significant contentagreements: live and exclusive television and IPTV rights to 'La Liga' Spanishfootball from 2006 to 2009; a new four-year agreement to broadcast the NFL untilthe 2010/11 season; and a ten year agreement for live and exclusive television,mobile and broadband rights to show the PGA Championship, one of golf's fourmajor championships, through to the end of 2016. Sky Sports has furtherincreased its commitment to women's sports coverage with the agreement tobroadcast the 2006/07 domestic netball season. Moreover, on 31 July 2006, Skylaunched a second Sky Sports HD channel, thereby further extending the amount ofcontent available to HD subscribers. Throughout the 2006/07 football season SkySports will be showing Barclays Premiership matches, Coca-Cola League games,selected matches from the UEFA Champions League, FA Cup, Carling Cup, GuinnessPremiership rugby. Furthermore, domestic and international cricket played in theUK are now produced in HD. During October, Sky One secured exclusive UK television rights to the third andfourth seasons of the award-winning series "Lost", further cementing thechannel's position as the home of the best US drama. The show will also be madeavailable on Sky's broadband and mobile platforms. Furthermore, during thequarter, Sky One screened "Robbie Williams Live: A Close Encounter", anexclusively live concert from Roundhay Park in Leeds, which was the UK'sfirst-ever live music event broadcast in HD. Sky News reinforced its reputation for breaking news by being the first UKnetwork to report the August airline terror alert. This position was furtherenhanced with the award of the International Emmy Award for Breaking News forits coverage of the 7 July London Bombings. On 26 October 2006, the Group's HD channel line-up expanded further with thelaunch of The History Channel HD. The schedule will include a wide range ofspectacular programmes in high definition, including UK premieres of"Engineering an Empire" and "The Sahara", as well as HD versions of "TheCrusades: Crescent & The Cross" and "Beyond the Da Vinci Code". During the quarter the Group demonstrated the breadth of its offering,broadcasting both the Ryder Cup and UEFA Champions League matches live, andsimultaneously, over standard definition, HD and broadband. In addition,subscribers to the Group's Sky Mobile TV service could enjoy live coverage ofthe Ryder Cup on their mobile phones. In October, the Group expandeddistribution of its Sky Mobile TV service by reaching agreement with Orange (UK)and 3 UK to make the service available to their 3G mobile customers. --------------- (2) The Group has adjusted its calculation of ARPU to reflect revisedcontractual arrangements in respect of Sky Talk. Previously, Sky Talk revenueswere recognised on a net margin basis, whereas, now, the Group recognises grosstelephony revenues in its ARPU calculations. On a like-for-like basis, thisadjustment would result in each ARPU figure disclosed during the previousfinancial year being increased by £3 (therefore, ARPU for the three months toJune 2006 would increase from £388 to £391). Residential Broadband and Telephony Sky announced its new broadband internet access service, Sky Broadband, on 18July 2006 and implemented a controlled provisioning process in anticipation ofhigh levels of customer demand. Following an initial period of registrationsonly, the Group commenced provisioning in mid August. At 31 October 2006, aroundone million customers had registered their interest in Sky Broadband and theGroup had received 113,000 orders. Of these, 74,000 customers' broadband lineshad been activated, 65,000 (88%) of which were located within Sky's network. Thevast majority of these customers were activated within 15 working days of theirbooking date. At this early stage the mix of products chosen is encouraging,with over half of customers taking a paid-for broadband package, reflecting theoffering's high quality and compelling value. The Group had a further 35,000customers registered to UK Online, Easynet's residential broadband service,bringing the total number of broadband customers to 109,000. Sky's broadband provisioning process is designed to ensure that customer demandis managed in an efficient manner. After the launch announcement, the Group's TVcustomers were invited by letter to register their interest in Sky Broadband.Following registration, customers have been invited on a phased basis to orderthe Sky Broadband product of their choice in accordance with network coverage.This has allowed the Group to maintain a controlled approach to customerprovisioning and to manage the increase in the rate of customer orders from anaverage of 950 per week during August to around 10,000 per week during Septemberand October. This rate has accelerated further and the Group is currentlyprocessing around 20,000 orders a week. The recent launch of 'eSales', theGroup's online ordering tool, will facilitate further this acceleration incustomer activations and reduce demand placed on the call centres. At 31 October 2006, 602 exchanges had been handed over by BT OpenReach forEasynet equipment installation, of which 540 had been unbundled, (representing36% of UK homes passed). The Group remains on track to meet its target networkcoverage of 50% of UK homes by December 2006 and 70% of UK homes by December2007. Following the re-launch of the Group's telephony offering on 18 July (unlimitedanytime calls to another UK landline for £5 per month), Sky Talk recorded itshighest rate of subscriber growth for over two years. At 31 October 2006, 49,000customers had signed up to the £5 per month anytime call package, with 18% ofbroadband customers taking this telephony product. The total number of Sky Talkcustomers was 204,000. FINANCIAL REVIEW Total revenues increased by 11% compared to the three months ended 30 September2005 to £1,071 million. Total operating costs increased by £140 million to £891million, generating a Group operating profit of £180 million. This result isafter the inclusion of operating losses from the consolidation of the Easynetand Residential Broadband of £7 million and £35 million respectively. Excludingthese items, the Group's operating profit was £222 million. The Easynet operating loss of £7 million comprised £38 million of revenues and£45 million of operating costs; the net residential broadband operating loss of£35 million comprised £10 million of revenue offset by £45 million ofexpenditure. The costs of Easynet and broadband fall mainly within thecategories of marketing, subscriber management, transmission and administration.A breakdown of total revenues and operating costs within these categories willbe provided at the interim results in January 2007. DTH revenues increased by 6% on the comparable period to £792 million,principally driven by 5% growth in the average number of DTH subscribers. Wholesale revenues continued to disappoint, decreasing by 2% on the comparableperiod to £53m. This reflects the further reduction in the absolute number ofcable premium television subscribers which more than offset the changes towholesale prices in September 2005. Advertising revenues for the quarter were 4% lower than the comparable period at£78 million, reflecting the challenging conditions in the general televisionadvertising sector. This sector has declined by 8% during the quarter and isforecast to fall by 7% during the entirety of calendar year 2006. However,against this backdrop, Sky's overall share of this sector increased, and theGroup expects to continue to outperform the UK television advertising sector forthe remainder of this calendar year. SkyBet net revenues increased by 43% on the comparable period to £10 million, asa consequence of strong growth in sports betting and interactive gaming. GrossSkyBet revenue for the quarter was £126 million. Sky Active revenues of £22million for the quarter were in line with the comparable period. On an underlying (defined as Group revenue, expense or profits excluding thefinancial impact of Easynet and residential broadband) basis, other revenue grewstrongly by 26% on the comparable period to £72 million. This primarily reflectsincreased installation revenues from new products, with a corresponding increasein installation costs reflected within subscriber management expenditure. Despite significant investment in high quality Sports content (including the newECB cricket contract and the biennially staged Ryder Cup), total programmingcosts reduced by £3 million on the comparable period to £393 million,principally reflecting lower third party channel and Movie costs. Reduced thirdparty channel payments on the comparable period reflected improved distributionagreements and Film4's re-launch as a subscription-free channel. Movie costsdecreased on the comparable period due to the phasing of title delivery,favourable contract renegotiations and beneficial foreign exchange movements. Underlying gross margin (defined as underlying revenue less programming costs asa proportion of revenue) increased by three percentage points on the comparableperiod to 62% (after adjusting the prior year revenues to take account of thechange in accounting treatment of SkyBet revenues). Total other operating costs increased by £143 million to £498 million on thecomparable period, including £90 million of operating expenses from Easynet andthe residential broadband business. Excluding these movements, other operatingcosts increased on an underlying basis by £53 million. Marketing costs increased by £22 million on the comparable period to £161million. This movement reflects the absolute increase in new subscribers in thequarter, as well as broadband related acquisition and consumer marketingexpenditure. Subscriber management costs increased by £55 million on thecomparable period to £151 million, principally reflecting the inclusion ofEasynet and broadband related costs, a £10m depreciation charge relating to theinstallation of new customer management systems and increased new productinstallations (as disclosed within the other revenue analysis). Administrationand transmission costs increased by £27 million and £39 million respectively,predominantly due to the inclusion of Easynet and broadband related expenditureand increased depreciation as result of the Group's infrastructure investmentprogramme. Total operating profit was £35 million lower than the comparable period at £180million; underlying operating profit for the quarter increased by £7 million onthe comparable period to £222 million. Group operating profit margin for thequarter was 17%, although this rose to 22% on an underlying basis, in line withthe comparable period. Total earnings before interest, tax, depreciation and amortisation ("EBITDA")were £15 million lower than the comparable period at £224 million; underlyingEBITDA for the quarter increased by £19 million on the comparable period to £258million. After the Group's share of operating profits from joint ventures of £2 millionand a net interest charge of £16 million, the Group made a profit before tax inthe quarter of £166 million. The total tax charge for the period of £50 million includes a current tax chargeof £37 million and a deferred tax charge of £13 million resulting in aneffective tax rate of 30.1% (September 2005: 30.0%). The Group's profit after tax for the quarter decreased by £24 million to £116million, leading to a reduction in adjusted earnings per share to 6.3 pence from7.6 pence in the comparable quarter. The Group maintained its strong cashflow generation during the quarter. Despitea seasonal working capital outflow of £165 million (principally due to thetiming of payments for Sports rights) and significant investment in broadband,the Group was still able to generate a cash inflow from operations of £59million. After net interest payable of £25 million, taxation of £7 million andother items, the Group invested £78 million in its capital expenditure programmeand returned £211 million to shareholders in the final stage of its sharebuy-back programme. As at 30 September 2006, net debt increased during thequarter from £761 million to £997 million. DISTRIBUTIONS TO SHAREHOLDERS During the quarter the Group completed its share buy-back programme. Over thecourse of the last 12 month programme the Group repurchased 92 million sharesfor cancellation, representing five percent of issued share capital, forconsideration of £493 million (including stamp duty and commissions). The totalnumber of shares outstanding at 30 September 2006 was 1,753,412,599. CORPORATE In July 2006, the Group established a retail presence through the acquisition ofthe independent retailer 'You Me TV', which offered a variety of entertainment,broadband and telephony services via a network of 59 stores in the concourses ofshopping centres around the UK. Ownership of 'You Me TV' complements Sky'sexisting retail and venue sales and provides a platform to drive awareness andtake-up of the Group's fast-growing product range among new and existingcustomers. Since the acquisition, You Me TV's stores have been re-branded asSky retail units and now focus exclusively on the promotion of Sky products,having ended supplier relationships with ntl:Telewest and others. The number ofstores in the Sky retail network has increased to 81 since completion of theacquisition and is expected to reach 100 by 31 December 2006. It is estimatedthat the shopping centres in which the stores are situated receive more than 20million customer visits each week. The Group intends to continue to expand thenetwork over time to provide access to new venues and ensure that it can promoteits entertainment and communications services to a growing audience. Lord St John of Fawsley will not be seeking re-election as a Director of theCompany at today's AGM and therefore retires from the Board. The Board wishes toexpress their gratitude to Lord St John for the outstanding contribution he hasmade to the business over a number of years. CORPORATE RESPONSIBILITY During the quarter, Sky built upon its achievement of becoming the world's firstcarbon neutral media company. The company continued to work with employees andbusiness partners to improve energy consumption, save money and play a part inaddressing climate change. The Group has been recognised for the full disclosureof its CO2 emissions in the fourth report of the Carbon Disclosure Project (CDP)in September 2006. The CDP represents 255 global investors with assets of $31trillion. During the quarter, Sky launched the first remote control specifically designedto assist older customers, people with visual impairments and those with limiteddexterity. This was recognised by the RNIB and other leading advocates forpeople with disabilities. The Group continued to use the power of its brand toengage young people and, in October, launched a Sky Sports Victory Shieldwebsite to support the Under 16s football tournament. In addition, Sky's 'Livingfor Sport' programme extended its reach to 469 schools across the country. Use of measures not defined under IFRS This press release contains certain information on the Group's financialposition, results and cash flows that have been derived from measures calculatedin accordance with IFRS. This information should not be read in isolation of therelated IFRS measures. Forward-looking statements This document contains certain forward-looking statements within the meaning ofthe United States Private Securities Litigation Reform Act of 1995 with respectto the Group's financial condition, results of operations and business, andmanagement's strategy, plans and objectives for the Group. These statementsinclude, without limitation, those that express forecasts, expectations andprojections with respect to the potential for growth of free-to-air and pay-TV,fixed line telephony, broadband and bandwidth requirements, advertising growth,DTH subscriber growth, Multiroom, Sky+ and other services penetration, churn,DTH and other revenue, profitability and margin growth, cash flow generation,programming and other costs, subscriber acquisition costs and marketingexpenditure, capital expenditure programmes and proposals for returning capitalto shareholders. These statements (and all other forward-looking statements contained in thisdocument) are not guarantees of future performance and are subject to risks,uncertainties and other factors, some of which are beyond the Group's control,are difficult to predict and could cause actual results to differ materiallyfrom those expressed or implied or forecast in the forward-lookingstatements. These factors include, but are not limited to, the fact that theGroup operates in a highly competitive environment, the effects of laws andgovernment regulation upon the Group's activities, its reliance on technology,which is subject to risk, change and development, failure of key suppliers, itsability to continue to obtain exclusive rights to movies, sports events andother programming content, risks inherent in the implementation of large-scalecapital expenditure projects, the Group's ability to continue to communicate andmarket its services effectively, and the risks associated with the Group'soperation of digital television transmission in the UK and Ireland. Information on some of the risks and uncertainties associated with the Group'sbusiness are described in the "Review of the Business - Risk Factors" section ofSky's Annual Report on Form 20-F for the year ended 30 June 2006. Copies of theAnnual Report on Form 20-F are available on request from British SkyBroadcasting Group plc, Grant Way, Isleworth TW7 5QD or from the British SkyBroadcasting web page at www.sky.com/corporate. All forward-lookingstatements in this document are based on information known to the Group on thedate hereof. Except as required by law, the Group undertakes no obligationpublicly to update or revise any forward-looking statements, whether as a resultof new information, future events or otherwise. Appendix 1 Subscribers to Sky Channels Prior year Prior First first quarter quarter quarter as at as at as at 30 September 30 June 30 September 2005 2006 2006 DTH homes(1),(2),(3) 7,844,000 8,176,000 8,258,000 Total TV homes in the UK and Ireland(4) 26,417,000 26,684,000 26,764,000 DTH homes as a percentage of total UK and Ireland TVhomes 30% 31% 31% Cable - UK 3,281,000 3,294,000 3,251,000Cable - Ireland 588,000 604,000 606,000 Total Sky pay homes 11,713,000 12,074,000 12,115,000 Total Sky pay homes as a percentage oftotal UK and Ireland TVhomes 44% 45% 45% Sky+ homes 1,027,000 1,553,000 1,692,000 Multiroom homes(5) 748,000 1,047,000 1,093,000 HD homes - 38,000 96,000 Broadband customers - - 44,000 DTT - UK(6) 5,316,000 7,326,000 7,646,000 (1): Includes DTH subscribers in Republic of Ireland (441,000, as at 30 September 2006). (2): DTH subscribers includes only primary subscriptions to Sky (no additionalunits are counted for Sky+ or Multiroom subscriptions). This does not includecustomers taking Sky's Freesat offering or churned customers viewing free-to-airchannels. (3): DTH homes include subscribers taking Sky packages via DSL through Homechoice. (4): Total UK homes estimated by BARB and taken from the beginning of the monthfollowing the period end (latest figures as at 1 October 2006). Total Irelandhomes estimated by Nielsen Media Research, conducted on an annual basis in Julywith results available in September (latest figures as at July 2006). (5): Multiroom includes households subscribing to more than one digibox. (Noadditional units are counted for the second or any subsequent Multiroomsubscriptions.) (6): DTT homes estimated by BARB and taken from the beginning of the followingmonth (latest figures as at 1 October 2006). These include Sky or Cable homesthat already take multi-channel TV. Appendix 2 Glossary Useful definitions DescriptionAdjusted profit Profit for the period adjusted to remove mark-to-market movements in derivative financial instruments that do not qualify for hedge accounting, exceptional items and any changes in the estimate of recoverable tax assets in respect of prior years. Adjusted earnings per share Adjusted profit divided by the weighted average number of ordinary shares ARPU Average Revenue Per User: the amount spent by the Group's residential subscribers in the quarter, divided by the average number of residential subscribers in the quarter, annualised. Broadband Broadband is a common term for a high bandwidth connection - one that can send or download information many times faster than a standard telephone and modem. Churn The rate at which subscribers relinquish their subscriptions, expressed as a percentage of total subscribers. Digibox Digital satellite reception equipment. EBITDA Earnings before interest, taxation, depreciation and amortisation is calculated as operating profit before depreciation and amortisation or impairment of goodwill and intangible assets. Effective tax rate Taxation divided by profit before taxation. Gross Sky Bet revenue Gross stakes placed by customers on events taking place in the period and net customer losses in respect of casino, online roulette and similar interactive casino style games. HD High Definition. Homes passed The number of homes that are covered by Sky's network. Local loop unbundling A process by which BT's exchange lines are physically disconnected from BT's network and connected to other operators' networks. This enables operators other than BT to use the BT local loop to provide services to customers. Multichannel viewing share Share of viewers of non-analogue terrestrial television. Multiroom Installation of one or more additional digiboxes in the household of an existing DTH subscriber. Net debt Cash, cash-equivalents, short-term deposits, borrowings and borrowings related derivative financial instruments. Sky + Sky's fully-integrated Personal Video Recorder (PVR) and satellite decoder. Underlying Group revenue, expense and profit excluding the impact of Easynet and residential broadband. Underlying gross margin Underlying revenue less programming expenses as a proportion of revenue. Viewing share Number of people viewing a channel as a percentage of total viewing audience. Consolidated Income Statement for the three months ended 30 September 2006 2006/07 2005/06 Three Three months months ended ended 30 30 September September £m £m Notes (unaudited) (unaudited) Revenue 1 1,071 966Operating expense 2 (891) (751) EBITDA 224 239Depreciation and amortisation (44) (24)Operating profit 180 215 Share of results from joint venturesand associates 2 2Investment income 14 8Finance costs (30) (25)Profit before tax 166 200 Taxation (50) (60)Profit for the quarter 116 140 Earnings per share (in pence) from profit forthe quarterBasic and diluted 6.5p 7.5pAdjusted 6.3p 7.6p Notes: 1. Revenue 2006/07 2005/06 Three Three months months ended ended 30 September 30 September £m £m (unaudited) (unaudited) DTH subscribers 792 746Cable subscribers 53 54Advertising 78 81Sky Bet 10 7Sky Active 22 22Other 116 56 1,071 966 2. Operating expense 2006/07 2005/06 Three Three months months ended ended 30 September 30 September £m £m (unaudited) (unaudited) Programming 393 396Transmission and related functions 84 45Marketing 161 139Subscriber management 151 96Administration 102 75 891 751 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Sky