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Sky Network Television Annual Results 2003 - Summary & Forecast

Explore Sky Network Television's annual results for 2003, including subscriber growth, revenue analysis, expense breakdown, and key financial metrics. Discover the company's net profit, cash flow, capital expenditure, and future guidance for 2004. Stay informed about the latest programming initiatives and performance highlights.

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Sky Network Television Annual Results 2003 - Summary & Forecast

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  1. SKY NETWORK TELEVISION ANNUAL RESULTS 2003

  2. Subscribers

  3. ‘000 2002 2003 % Change UHF Residential 136.3 117.7 (13.6%) DBS (Satellite) Residential 284.3 340.3 19.7% DBS Wholesale 75.4 76.7 1.7% Commercial 7.2 8.1 12.5% Total Subscribers 503.2 542.9 7.9% Subscriber Growth

  4. Moving Annual Churn

  5. Churn

  6. Viewer Hours per Day

  7. Subscriber Revenue

  8. Total ARPU

  9. ARPU

  10. Advertising Revenue

  11. Programming Costs % Revenue

  12. EBITDA

  13. Capital Expenditure (excluding transponders)

  14. Net Profit/(Loss)

  15. Big Mac Index

  16. $NZ million 2002 2003 % Change Revenue 344.6 391.3 13.6% Operating Expenses 236.4 240.5 1.7% EBITDA 108.2 150.8 39.4% Depn & Amort 113.0 124.1 9.8% EBIT (4.8) 26.7 656.3% Interest 26.7 28.0 4.9% Other (1.3) (2.0) 53.8% Net Profit/(Loss) after Tax (30.2) 0.7 102.3% Results Summary

  17. $NZ million 2002 2003 % Change Net Operating Cash Flow 77.0 128.0 66.2% Net Investing Cash Flows (114.2) (96.0) (15.9%) Free Cash Flow (37.2) 32.0 186.0% Free Cash Flow

  18. $NZ million 2002 2003 % Change Residential 266.0 309.1 16.2% Commercial 19.6 22.3 13.8% Sky Watch 6.1 6.8 11.5% Advertising 16.5 19.6 18.8% Installation, programming sales & other 36.4 33.5 (8.0)% Total Revenue 344.6 391.3 13.6% Revenue Analysis

  19. $ million 2002 2003 % Change Programming 166.6 168.1 0.9% Subscriber Management 12.7 13.7 7.9% Transmission 6.9 7.0 1.4% Selling, General & Administration 48.6 49.7 2.3% Depreciation & Amortisation 113.1 124.1 9.7% Total Operating Expenses 347.9 362.6 4.2% Expense Analysis

  20. Programming Costs

  21. Foreign Currency Hedging • Sky’s hedging positions at 31 July 2003 • 97% hedged for 0 -12 months $US exposures @ .500 • 46% hedged for 13-24 months $US exposures @ .536 • 33% hedged for 25-36 months $US exposures @ .565 • 96% hedged for 0 -12 months $A exposures @ .899 • 74% hedged for 13-24 months $A exposures @ .904 • 66% hedged for 25-36 months $A exposures @ .892 • average $US payment rate for opex for year to June 03 = 44.8c

  22. Funding • New 5 year NZ$200m revolving bank facility refinanced in May 2003 - TD, HSBC, ANZ, BNZ, Westpac • Event of review if News direct/indirect ownership of Sky is less than 27.5% • Bank Facility drawn to NZ$148m. Margin is 75bp • NZ$111m of Capital Notes raised October 2001 @ 9.3%. Election date October 2006, market yield on notes @ June 03 was 7.6%

  23. Tax • Tax losses carried forward of NZ$106m @ 33% = $35m • Tax Asset of NZ$54m not recognised (includes June 02 offset to INL) • NZ$53m of losses offset by INL for June 02 year, NZ$52m anticipated for June 03 year • INL to repay cash to SKY when tax is due • ie ($53m + $52m) x 33% = $35m • Sky will receive imputation credit benefit of loss transfer

  24. $ million 2002 2003 % Change Transponder Lease 17.5 19.7 12.6% Subscriber Equipment 85.7 74.4 (13.2%) Digital Expansion 2.0 1.5 (25.0%) Interactive Applications 3.0 0.7 (76.7%) Right of renewal 10.7 7.6 (29.0%) Other 4.5 1.9 (57.8%) Total Capital Expenditure 123.4 105.8 (14.3%) Capital Expenditure Analysis

  25. DBS (Satellite) Install Costs $832 $803 $719 $524

  26. 2003 Key Messages • Net profit of $0.7m a $30.9m improvement • Operating cash flow up 66% to $128m • Negative free cash flow improved by $69m to a positive $32m • Subscriber numbers up 8% to 543k. • ARPU up 3% to $51.83, DBS ARPU up 5% to $59.35 • Net Churn down 7% to 10.8%

  27. 2004 Guidance • Our July 2003 survey of brokers forecasts indicates NZ$m Mean ($m) EBITDA 175 - 199 187 NPAT 29 - 47 39 Capex 70 - 106 91 • Guidance is that SKY expects to be at the lower end of each of these forecasts

  28. Programming Initiatives 2003/04

  29. SKY NETWORK TELEVISION ANNUAL RESULTS 2003

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