Liberty Media posts higher profit at Starz, QVC

By Kenneth Li

NEW YORK (Reuters) - Liberty Media reported fourth-quarter profit gains for two divisions on Wednesday, with Starz Entertainment cable networks benefiting from subscription growth and QVC shopping channel from increased sales.

The company's two tracking stocks rose -- Liberty Interactive Group, home to QVC, and Liberty Capital Group, which includes Starz.

Liberty Media, controlled by cable industry pioneer John Malone, did not provide figures for net income and earnings per share but posted operating results for the two divisions.

Liberty Interactive's revenue rose 11 percent and its operating cash flow 21 percent, boosted by QVC, whose revenue rose 7 percent to $2.24 billion and operating cash flow 19 percent to $557 million.

At Starz, revenue rose 4 percent to $257 million and operating cash by 72 percent to $50 million.

Libery Media plans to buy back up to $1 billion of Liberty Capital Series A shares and Series B common stock at a range of $105 to $113 per share.

Liberty said it expects interactive revenue and operating cash flow to rise in a range from high single to low double-digit percent on a compounded annual growth rate in the next three to five years.

EYEING SIRIUS, XM DEAL

The company, which aims to convert a portfolio of big minority stakes in media and communications companies into operating businesses, struck a deal last year to swap its 16.3 percent stake in News Corp. for News Corp.'s controlling 38.5 percent stake in top U.S. satellite television operator DirecTV Group Inc., some regional sports networks and $550 million in cash.

The deal, expected to close later this year, marked News Corp. Chief Executive Rupert Murdoch's exit from the U.S. satellite TV business as he now views the Internet as a bigger source of financial growth.

Since then, Liberty has been the target of speculation that it could merge DirecTV with rival satellite TV service EchoStar Communications Corp.

Liberty Chief Executive Greg Maffei told analysts the two companies were discussing myriad ways to work together.

"We have got a host of initiatives underway with EchoStar to try to capture some of the synergy that one would get through a merger, but not rise to the level of antitrust consideration," Maffei said, highlighting areas such as offering a broadband service.

But, he added, "I will say we will watch XM/Sirius with interest."

Sirius Satellite Radio and XM Satellite Radio agreed earlier this month to merge, combining the only two satellite radio licenses, but the deal awaits regulatory approval.