Press release
Record Low Churn, Improved Triple Play and Strong Free Cash Flow
LONDON, May 5, 2009 (GlobeNewswire via COMTEX) -- Virgin Media Inc. (Nasdaq:VMED) announces results for the quarter ended March 31, 2009.
Financial
* Total revenue of GBP936m (excludes Sit-up - see below) (Q1-08: GBP947m)
* OCF1 of GBP312m (Q1-08: GBP324m)
* Operating income of GBP13m (Q1-08: GBP2m loss)
* Free Cash Flow2 of GBP62m (Q1-08: GBP82m)
* Net cash provided by operating activities of GBP129m (Q1-08: GBP111m)
* Disposal of Sit-up business on April 1st; Sit-up treated as discontinued operations in Q1-09 and prior periods adjusted accordingly
Operational
* On-net3 ARPU increased year-on-year for third successive quarter to GBP42.29 (Q1-08: GBP41.95)
* On-net churn reduced to a record low of 1.1% (Q1-08: 1.2%)
* On-net customer net additions of 7,100 (Q1-08: 4,900)
* Revenue Generating Units (RGU)4 net increase of 148,400 (Q1-08: 204,300) to 12.56m (Q1-08: 11.90m)
* Record triple-play penetration of 57.0% (Q1-08: 51.3%)
On-net Broadband
* On-net broadband customer net increase of 47,300 (Q1-08: 88,400) to 3.73m (Q1-08: 3.50m)
* Improving tier mix with 1.4m next generation (10Mb and above) customers (Q1-08: 0.9m)
* 75% of gross additions subscribed to 10Mb or higher (Q1-08: 19%)
* 50Mb broadband roll-out proceeding on track
* Upgrading 2Mb customers to 10Mb, commencing May 2009
Television
* TV customer net increase of 30,600 (Q1-08: 36,800) to 3.65m (Q1-08: 3.51m)
* Video-on-demand (VOD) usage rises to 53% of digital customers (Q1-08: 46%)
* Highest ever average VOD views of 55m per month (Q1-08: 36m)
Mobile
* Contract mobile customers net increase of 62,900 (Q1-08: 59,400) to 712,300 (Q1-08: 435,700), up 63% in the last twelve months
1 OCF: operating income before depreciation, amortization, goodwill and intangible asset impairments and restructuring and other charges. OCF is a non-GAAP financial measure. Please see Appendix F for a reconciliation of non-GAAP financial measures to their nearest GAAP equivalents.
2 Free Cash Flow or FCF: operating income before depreciation, amortization, goodwill and intangible asset impairments and restructuring and other charges (OCF) reduced by purchase of fixed and intangible assets, as reported in our statements of cash flows, and net interest expense, as reported in our statements of operations. FCF is a non-GAAP financial measure.
Please see Appendix F for a reconciliation of non-GAAP financial measures to their nearest GAAP equivalents.
3 On-net: where consumer services are provided by the Company's fiber optic cable network, as opposed to non-cable areas, referred to as off-net.
4 RGU: a contract for residential broadband, TV, telephony or contract mobile services. A triple-play customer is one household taking broadband, TV and telephony, which equals three RGUs.
Neil Berkett, Chief Executive Officer of Virgin Media, said:
"We began 2009 with another quarter of sound operational and financial performance. For the third successive quarter, we've achieved year-on-year growth in on-net ARPU and have driven churn to a record low, whilst maintaining strong levels of cash generation. We have achieved these results by continuing to deliver a differentiated and highly competitive consumer proposition that exploits our strength in broadband and video-on-demand."
