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BSkyB posts record profit

May 02 2012 10:11 Reuters

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London - BSkyB posted record nine-month operating profit boosted by strong broadband growth, as Britain's dominant pay-TV group showed few side effects from problems affecting its biggest shareholder - Rupert Murdoch's News Corp.

"We have made a good start to 2012," chief executive Jeremy Darroch said on Wednesday. "In what remains a tough economic environment, strong and consistent execution of our plan has delivered good growth across our product range."

BSkyB posted a 5% rise in nine-month revenue to £5.1bn, with earnings per share up 24%. Adjusted operating profit rose 15% to £908m in the period, during which Britain re-entered recession.

Rupert Murdoch's News Corp, which owns 39% of BSkyB, had to withdraw a bid to buy the rest of the group last July after a phone-hacking scandal at one of its British newspapers.

The fallout forced former BSkyB chief executive James Murdoch - Rupert's son - to stand down as chairperson last month, to try to prevent the scandal hitting the satellite broadcaster.

Regulator Ofcom has been conducting an ongoing investigation into whether BSkyB was a fit and proper owner of a broadcast licence in light of the problems at News Corp. That will entail an examination of the latter's owners and officers.

BSkyB's strong nine-month financials were driven by solid demand for services such as broadband and telephony, which made up for the fact it has started to add fewer new customers to its main television service.

The group added 15 000 new customers to the TV service in its third quarter, broadly in line with expectations, and compared with 51 000 added a year earlier.

The group also saw strong growth for its high-definition television service and said its new channel for Formula One was proving popular.

"The decision to focus our marketing on home communications has paid off with our fastest quarter of growth since launch and confirmation that Sky is now Britain's favourite triple play provider," Darroch said.

BSkyB has added fewer net new customers to its service in recent quarters, as it focused on cost control and selling more products to existing customers.

Its shares were up 2.6% in early trading.

bskyb  |  news corp
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