Foxtel grows ebitda 15.5% in FY11

Foxtel grows ebitda 15.5% in FY11

Foxtel has revealed its ebitda grew 15.5% in FY11 to $551 million, even as the company struggled with muted subscriber growth.

The pay TV operator also lifted its pre-tax profit 26% to just over $200 million, and its revenue by around 6% to $2.14 billion.

But the company's direct customer base grew just 2.5% over the year. Foxtel CEO Kim Williams said subscriber growth had been impacted by shaky consumer confidence.

“Subscriber growth remains testing as a result of the ongoing reluctance of consumers to commit to new discretionary spend,” he said, “whilst the increased competition from Freeview and broadband delivered video entertainment services has exacerbated the acquisition challenge.”

Customer churn was also 12.5% for the year, although this was a significant improvement on the prior year and Foxtel's best retention performance in four years.

Foxtel ended the financial year with 1.65 million subscriber households, including wholesale services.

Instead of subscriber growth, it was take-up of value-added services that fueled earnings growth. The company said nearly three-quarters of its customers now take the Foxtel iQ PVR service, and nearly one third subscribe to its High Definition services.

Foxtel in July arranged to acquire regional pay TV broadcaster Austar for $2.5 billion, in an offer that had first been made in May.

In its FY11 results announcement, Foxtel said it was confident the ACCC will clear the deal on the basis that the proposed merger would not substantially lessen competition in any market.

Foxtel is jointly owned by Telstra (ASX:TLS), News Corp (ASX:NWS) and Consolidated Media Holdings (ASX:CMJ).

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Tags financial resultsAustarfoxtelASX:TLSKim WilliamsConsolidated MediaASX:CMJASX:NWSNew

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