Cablevision's 1st-Quarter Loss Narrows
Posted on: Tuesday, 9 May 2006, 15:01 CDT
By SETH SUTEL
NEW YORK - Cablevision Systems Corp. on Tuesday reported a narrower first-quarter loss of $58.9 million on higher earnings from its core cable TV business. Cablevision also owns Madison Square Garden, Radio City Music Hall and several cable networks.
The loss, which amounted to 21 cents per share for the three months ended March 31, compared with a net loss of $118.9 million, or 41 cents per share, in the same period a year ago. Revenue rose 16 percent to $1.41 billion from $1.21 billion.
On an operating basis, before interest payments, taxes, investment gains and losses and other factors, income rose 38 percent to $103.1 million. Cablevision's net income is greatly affected by interest payments on its debt, which is currently $11.4 billion following the payout of a special $3 billion dividend.
The gain in operating income was largely due to a 35 percent jump in profit from cable TV and telecommunications services. Cablevision has been aggressively signing up customers to premium offerings like high-speed Internet and phone service delivered over cable lines.
Cablevision shares rose 42 cents, or 2 percent, to $21.32 in midday trading on the New York Stock Exchange after briefly rising to a new 52-week high of $22 earlier in the session.
Cablevision also reported a gain of about 39,000 basic video customers, its eighth consecutive quarterly increase. Analysts watch this number closely to make sure cable companies aren't losing customers to rival satellite TV providers. Sanford C. Bernstein analyst Craig Moffett told clients in a note that he was "positively surprised yet again" by the strong results.
The company also reported gains of 112,000 high-speed Internet customers and 134,000 more digital phone customers in the quarter. Cablevision has seen strong results from marketing a "triple play" bundle of video, Internet and phone service.
Tom Rutledge, Cablevision's chief operating officer, told analysts on a conference call that the triple play offering had significantly reduced the amount of churn, or subscriber departures - another figure watched closely by investors. Rutledge said churn was about 14 percent less among triple play customers compared with those who weren't.
Cablevision's cable networks unit, which includes AMC, IFC and WE, reported an operating loss of $5 million, down from a profit of $4.7 million in the year-ago period on higher programming and marketing costs for original material.
Madison Square Garden had a slightly wider operating loss of $12.3 million due to several factors, including an NBA luxury tax and higher costs from professional hockey compared to last season when there was a lockout. Cablevision owns the New York Knicks NBA team and the NHL's New York Rangers.
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On the Net:
http://www.cablevision.com
Source: Associated Press/AP Online
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