To enjoy the full Mail & Guardian online experience: please upgrade your browser
29 Jul 2011 15:26
Satellite broadcaster British Sky Broadcasting (BSkyB) confirmed widespread speculation by announcing a big return of cash to shareholders while reporting a 23% gain in operating profit.
The satellite broadcaster—which is 39% owned by Rupert Murdoch’s News Corp—said on Friday it was raising its full-year dividend by a hefty 20% and revealed plans for a £750-million ($1.2-billion) share buyback programme.
“This may not be enough for the mega bulls, but a good start in our view,” said Steve Liechti, analyst at Investec Securities.
BSkyB shares were up half a percent to 720 pence in early trading on the London Stock Exchange. They had been trading at 850 pence in early July before the phone hacking scandal at News Corp’s News of the World tabloid became particularly acute.
The market was expecting some sort of return to shareholders after News Corp withdrew its bid for the 61% of shares it does not own.
The bid was shelved earlier in June after the phone hacking revelations by News of the World, which was subsequently closed down.
James Murdoch remained in place as chairperson of BSkyB following Thursday’s board meeting, despite concerns that more of his time will be taken up in dealing with the fallout of the hacking scandal which has so far led to the resignation of two senior News Corp executives.
“The board discussed governance generally, that included the role of the chairperson,” said BSkyB chief executive Jeremy Darroch.
Formula 1 interests
Adjusted operating profit—excluding one-time gains a year ago—rose to £1.1-billion from £872-million a year earlier. On the net level, profits were 8% lower at £810-million ($1.3-billion).
Revenue was up 16% to £6.6-billion.
During the year, the company passed the 10-million customer mark, and it said 27% of its customers have signed up for its triple play of television, broadband and telephone, up from 21% a year earlier.
“It is to the credit of Sky’s first-class management team that the company has continued to deliver throughout the offer period that ended earlier this month,” Murdoch said.
As part of the share buyback plan, BSkyB said News Corp had agreed to sell shares to insure that its stake does not increase its stake above the present 39%.
BSkyB, which has built its success on a stable of exclusive sports rights and movies, added Formula 1 racing to its schedule in a deal with the British Broadcasting Corp.
The BBC, which had exclusive rights to show Formula 1 but is under pressure to cut costs, has agreed to a deal in which it continues to broadcast half of the races including the season finale while BSkyB gained rights to show all of them.
Darroch declined to say how much it had paid to add an attraction in “the top tier of sports property”.—Sapa-AP
Create Account | Lost Your Password?