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EARNINGS ROUNDUP / DIRECTV

Subscriber gains boost net income

November 07, 2008|Times Wire Reports

DirecTV Group Inc., the nation's largest satellite-TV operator with more than 17 million customers, said its third-quarter earnings rose 14%, fueled by growth in subscribers, higher prices and lower capital expenses.

"We are in a tough economy and a competitive environment," Chief Executive Chase Carey said.

But business has been good so far and, "overall, the impact is marginal," he said.

The El Segundo-based company reported net income of $363 million, or 33 cents a share, up from $319 million, or 27 cents, a year earlier.

The result came in 2 cents short of the average estimate from analysts polled by Thomson Reuters.

Revenue increased 15% to $4.98 billion, boosted by a 49% increase in Latin America to $658 million.

DirecTV added 156,000 net new U.S. customers in the quarter, down from 240,000 in the same quarter a year ago.

In Latin America, where DirecTV has stakes in local operators, net new customer additions fell to 79,000 from 161,000.

DirecTV added fewer U.S. customers partly because a distribution agreement with phone company AT&T Inc. ended in April. The deal will be renewed starting in February.

Sanford Bernstein analyst Craig Moffett said DirecTV's subscriber growth was weaker than expected and its cancellation rate was higher than projected.

Shares of DirecTV dropped 4 cents to $20.76.

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