Austar (ASX:AUN) posted a surge in profit despite the effects of Australia's recent natural disasters on subscriber numbers and revenue in the first quarter.
While profit increased 355% to $74 million, revenue stayed flat at $174 million.
Austar said average revenue per user (ARPU) fell 1% from a combination of increased promotions and credits due to natural disasters. Customer churn also grew to 1.72%, from 1Q10's 1.39%.
“The devastation of so much of regional Australia by flooding and cyclones had an immediate impact on Austar,” CEO John Porter said.
But he added that the company achieved record sales and has witnessed churn returning to normal levels since March, as the region began to recover.
Operating expenses also grew 6% to $37 million, cash capex increased 33% to $20.7 million, and operating cash flow fell 2% to $59 million.
But profit grew despite these impacts due to $95.7 million booked from a spectrum sale and impairment reversal, Austar's report shows.
Austar's major shareholder, US cable operator Liberty Global, is in talks over a potential sale of its 54% stake to Foxtel.
AUN shares fell 1.52% during Wednesday's trading to $1.280.