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Cablevision Swings to $54.1M 4Q Profit

Posted on: Monday, 27 February 2006, 15:00 CST

By SETH SUTEL

NEW YORK - Stronger cable earnings led Cablevision Systems Corp. to a profit of $54.1 million for the fourth quarter following a year-ago loss that reflected charges related to an abandoned satellite TV venture.

The earnings reported Monday were equivalent to 19 cents per share for the three months ended Dec. 31 and contrasted with a loss in the year-ago period of $305.8 million or $1.06 per share, which included a $166.3 million charge associated with the closure of Voom, a high-definition TV business.

Revenues rose 12.5 percent to $1.49 billion from $1.32 billion a year ago on big gains in its cable TV business as the company signed up more customers for premium services like digital video, high-speed Internet and digital phone service.

Cablevision's shares rose $1.31, or 5.2 percent, to $26.51 in morning trading on the New York Stock Exchange.

Cablevision, which is based on Long Island and has about 3 million cable subscribers around the New York area, has been one of the most successful of the cable providers in expanding premium services.

Earnings from its core cable TV business rose 38.6 percent on a 16.1 percent gain in revenues. The number of high-speed Internet customers rose 5.9 percent in the quarter, digital phone customers rose 21.6 percent, and basic video customers edged up 0.6 percent.

The company also reported other favorable indicators watched closely by investors: its average revenue per subscriber rose 3.9 percent to $100.46, while the amount of "churn," or subscriber turnover, decreased to 1.8 percent in basic video from 2.1 percent in the same quarter last year. Churn in digital video and Internet customers also declined.

Cablevision's Madison Square Garden property also reported a 70.5 percent rise in operating income on a 13.4 percent increase in revenue compared with the same period a year ago, when the Garden, home of professional hockey's New York Rangers, suffered from the NHL lockout.

Cablevision's networks division, however, reported a 4 percent decline in revenues. The unit, which includes AMC, IFC and WE: Women's Entertainment, swung to a profit of $21.6 million from a loss of $161.3 million a year, which reflected the Voom shutdown.

The company also issued upbeat guidance for 2006, saying it expected basic video subscriber growth of 2.0 percent to 2.5 percent, as well as growth in revenues and adjusted operating cash flow in the mid-teens percentage range.

Sanford C. Bernstein analyst Craig Moffett called Cablevision's results "excellent" in a note to investors, saying that "Cablevision is now definitively taking share back from satellite TV."

For the full year, Cablevision reported earnings of $94.3 million or 33 cents per share versus a loss of $676.1 million or $2.36 per share in 2004. Full-year revenues rose 9 percent to $5.18 billion from $4.75 billion a year ago.

Last year Cablevision shut down a satellite TV broadcaster called Voom, but said it would hold on to several high-definition TV networks associated with it. The dispute pitted the company's chairman and founder Charles Dolan against his son James, the CEO. The Dolan family controls the shareholder vote of Cablevision through a special class of supervoting shares.

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On the Net -

http://www.cablevision.com

Source: Associated Press/AP Online

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