BSkyB on track to meet 2010 target

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BSkyB has said its target of 10 million customers in 2010 remained in view after adding 56,000 customers in the first three months of this year.

The broadcaster reported customer numbers of 8.9 million at the end of March and said loyalty improved after a churn rate of 10.5% proved to be the best figure for the third quarter of the financial year in four years.

BSkyB said operating profits for the nine months to March 31 were down £36 million to £521 million, reflecting investment in broadband and telephony, as well as the additional cost of its new Premier League football contract.

BSkyB shares opened higher on Wednesday after the figure for net customer additions met City expectations.

Sky said: "Customer growth continues to be strong despite a difficult consumer environment and we are on track for our target of 10 million customers in 2010.

BSkyB said it was encouraged by the number of customers taking more than one product, helping revenues grow 10% to £3.7 billion in the nine months.

Sky Broadband added 229,000 customers to 1.4 million in the quarter, while Sky Talk saw additions of 180,000 to leave its customer base at 1.1 million.

The group said the reduction in short-term viewing discounts and the implementation of an installation charge across all products were "contributing to the long-term health of the business".

This time last year, the group revealed a churn rate of 13.7% - far higher than the group's 10% target and up from the 11.9% seen in the previous quarter.

It was largely down to Sky's decision to reduce the discounts offered in a bid to dissuade subscribers from leaving, only to return on a lower rate. As predicted by the group, the churn rate has since been gradually reducing and hit its target of 10% in the final three months of last year.


Source: The Press Association.