Sirius loss widens; revenue, subscriber targets lifted By David B. Wilkerson MarketWatch
Last Update: 10:10 AM ET Aug 1, 2006 http://custom.marketwatch.com/custom/myway-com/news-story.asp?guid={B16435A1-A0AD-4CAC-A322-740881FCB3D6} CHICAGO (MarketWatch) -- Sirius Satellite Radio Inc. on Tuesday reported a wider second-quarter loss, even as revenue nearly tripled from the year-earlier quarter, with costs climbing dramatically. The company raised its revenue and subscriber forecasts for 2006. Sirius said it lost $238.8 million, or 17 cents a share, compared with its year-ago loss of $177.5 million, or 13 cents a share. The loss in the latest quarter includes a charge of 1 cent per share related to certain equipment that the company no longer needs now that it has a new satellite contract. Total operating expenses jumped 68% to $380.6 million. Revenue soared to $150.1 million from $52.2 million. Analysts polled by Thomson First Call were expecting a loss of 16 cents a share on revenue of $146.9 million. Sirius ended the quarter with 4.68 million subscribers, representing a 158% increase from the second quarter of 2005. The company picked up 600,460 net subscribers during the latest three months, capturing 60% of satellite radio sign-ups. Acquisition cost per gross subscriber addition fell to $131 from $160 a year earlier. Average monthly churn, or the rate of subscriber cancellations, rose to 1.8% from 1.4%. Sirius now expects to have 6.3 million subscribers by the end of 2006, up from its previous forecast of more than 6.2 million. It also sees revenue of $615 million, compared with its earlier estimate of more than $600 million. Analyst Kit Spring at Stifel Nicolaus & Co. reiterated his buy rating on the shares, saying the company's raised subscriber forecast was "a slight surprise," given its announcement earlier this month that it had suspended production and shipment of some of its radios containing FM transmitters until they can be brought into compliance with federal emissions rules. The Federal Communications Commission contacted both Sirius and rival XM Satellite Radio about such radios earlier this year, and both temporarily halted production of certain models. There have been complaints that the FM transmitter in some satellite radios causes interference on some stations at the lower end of the FM band -- frequencies often occupied by public stations. These signals aren't as strong as those of stations farther up the dial, and can therefore more easily be overpowered by interference. Sirius shares were up 2.4% at $4.30 in early trading Tuesday. ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu Reply with a "Thank you" if you liked this post. _____________________________ MEDIANEWS mailing list [email protected] To unsubscribe send an email to: [EMAIL PROTECTED]
