New services key for pay-TV resilience
Foxtel CEO Kim Williams yesterday echoed words from his counterpart at Austar earlier in the week, saying that the months ahead “appear confronting for the country and Australian business generally and this will inevitably provide Foxtel with challenges to maintain its growth momentum.”
While subscriptions rose 7% last year to reach 1.449 million at the end of December, (1.591 million including wholesale customers), Williams said the platform would need to offer new services to respond to the current challenges. These would be added progressively during the year, he said.
“The services will include a range of new channels, enhanced ways to navigate the Foxtel universe of channels and the introduction of Foxtel by Broadband. Foxtel’s broadband offer will allow subscribers to watch Foxtel on-line, exclusive events as well as shows from Foxtel’s most popular channels.”
Financially, Foxtel remains strong with leverage of 1.8 times EBITDA, no debt falling due until mid-2012 and a strongly hedged position against the fall in the Australian dollar.
EBITDA for the half-year to the end of 2008 was A$196 million, an increase of 19% on the same period the previous year. Revenue was A$908 million, up 13%, with subscription revenue up 11% to A$762 million.
Foxtel said that despite the economic climate, new subscriber additions were in line with the same period in 2007 with churn 0.2% lower at 13.3%. Nearly 45% of subscribers take the top pack and over one-third now take Foxtel iQ, with two-thirds of new subs in the half-year taking an iQ subscription. However, Foxtel HD+ signed up only 85,000 subscribers in the half-year.