* Wins 73,000 new subscribers vs f'cast 55,000
* Q1 operating loss 55 mln eur, in line with estimates
* Shares up 4.3 pct, hit highest in 19 months
(Adds analyst comment, shares)
By Nicola Leske
BERLIN, May 12 Loss-making pay-TV broadcaster
Sky Deutschland AG SKYDn.DE won more subscribers than expected
in the first quarter, bringing it closer to profitability and
boosting its shares to a 19-month high.
The company formerly known as Premiere, in which News Corp
(NWSA.O) owns a 49.9 percent stake and whose main draw is German
premier league soccer, has suffered from sluggish growth because
of Germans' reluctance to pay for premium TV content.
Chief Executive Brian Sullivan, who took the helm in April
2010, said on Thursday: "We are happy with the results but at
the same time are aware that this is just the beginning and
there is still plenty to do."
The stock rose as high as 3.437 euros, its highest since
October 2009, and was up 4.5 percent at 3.344 euros by 1005 GMT,
outpacing the STOXX Europe 600 media index .SXMP which was
down 1 percent.
In the quarter, Sky Deutschland added 73,000 new
subscribers, which put its total subscribers by end-March at
2.73 million and well above estimates of around 55,000.
Sullivan has said that the market's understanding that the
company should break even at around 3 million subscribers or
slightly fewer was broadly correct.
Analysts at UBS noted Sky had delivered another strong set
of results and estimated net additions could reach 365,000 if
the record low churn of 9.9 percent continues for the rest of
"This is Sky's third consecutive quarter meeting or beating
expectations. We believe a succession of solid quarters combined
with credible long term guidance adds further support to the
bull case on Sky," UBS analysts said.
Sky Deutschland, which also broadcasts Hollywood movies,
documentaries, dramas and pornography, has said its core
earnings will improve significantly in 2011 but will remain
negative. It has also said it will give an update on its outlook
in the second quarter of this year.
Sky Deutschland's first-quarter loss before interest, taxes,
depreciation and amortisation reached 55 million euros ($79.2
million) compared with 64.5 million a year earlier and bang in
line with the average analyst estimate.
Quarterly sales were 269.6 million euros, slightly more than
the 265 million estimated.
The company is Germany's only pure play pay-TV broadcaster,
a tricky business because consumers can choose from more than 30
free channels and are reluctant to pay extra.
In addition, cable companies and incumbent telecom group
Deutsche Telekom (DTEGn.DE) are keen to have their fingers in
the pie by offering their own TV services in an effort to tap
new revenue streams.
(Editing by David Holmes)