Sirius Conference Call Wrap Up
May 2, 2006
The results for the first quarter are in and Satellite Standard group brings you the details of the call.
Sirius beat the street on all metrics across the board. The loss was narrower than expected, coming in at 33 cents per share versus expectations of 36 cents per share. Revenue all beat street expectations. Sirius posted $126,700,000 in revenue.
SUBSCRIBERS
Sirius finished the quarter with 4,077,747 NET subscribers. This represented an addition of 761,187 subscribers. Sirius now has 38.54% overall market share in satellite radio, and in Q1 increased that category by 2.68 points.
Sirius increased year end 2006 subscriber guidance to 6,200,000 subscriber, up from 6,000,000.
Sirius captured 57% of the overall satellite radio subscribers for the quarter.
Sirius captured 64% of the retail subscribers in the quarter by adding 534,958 NET Retail subscribers. For the first time, NPD percentage share numbers had to be adjusted up for Sirius. Sirius’ NPD share for the quarter was 59%.
Sirius posted NET OEM subscribers of 225,343. This represents 27% of the total OEM Sirius has guided to. Their current guidance for the OEM channel is 826,000.
LOSS
Sirius posted a NET loss of $458,500,000 for the first quarter. It is important to note that 20 cents of the 33 cent loss are attributable to equity granted to third parties (items such as the Howard Stern shares). The equity granted to third parties line item accounted for $284,586,000. On a year over year basis the adjusted loss went up by 1 cent. The adjusted loss was $136,650,000.
REVENUE
Sirius brought in revenue of $126,700,000, beating street expectations. Sirius expects 2006 revenue to exceed $600,000,000
ADVERTISING REVENUE
Sirius improved dramatically in this area. Sirius posted Advertising Revenue of $7,300,000. This represents more revenue than all of 2005, and Sirius stated that they captured 53% of all satellite Radio ad dollars even while having a smaller subscriber base. The impact of revenue on ARPU was an addition of 65 cents (substantially higher than XM).
SUBSCRIBER ACQUISITION COST (SAC)
Costs to gain subscribers came in at $113. Sirius maintained guidance of SAC cost approaching $110 for the full year 2006.
CHURN
Sirius reports a FULLY LOADED churn. Sirius churn came in at 1.8%, and was in line with guidance and expectations. Deactivations for the first quarter came in at 199,423. For comparison, XM had over 450,000 deactivations in Q1.
AVERAGE REVENUE PER SUBSRIBER (ARPU)
Sirius had an ARPU of $10.70. The impact of mail in rebates, ad revenue, and rental cars brought ARPU to $10.80
CASH FLOW BREAK EVEN
Sirius reiterated that they anticipate CFBE as early as Q4 2006, and for the entire year of 2007.
Overall the call was very positive, and the results for the quarter have been well received by the street. Satellite Standard Group will be looking more closely at certain aspects of the metrics, and will be publishing articles on them. Stay Tuned
5/02/2006 09:33:00 AM
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