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Virgin Media posts strongest result for four years

Virgin Media has posted its strongest quarterly revenue growth since its creation following the merger of NTL with Telewest four years ago, with total revenues up 7.1% to £964m (€1.152bn). Operating income grew from £9m to £80m year-on-year, while free cash flow was up 37.3% to £109m.

The UK cable operator also posted positive subscriber growth in a traditionally weak quarter, with 9,100 new customers signed up compared with a loss of 27,800 for the same period last year. Net added product sales stood at 120,800, up 26.2%. The company had 1.2 million HD customers at the end of June, up 79.7% year-on-year, while triple-play penetration at the end of the quarter stood at 62.4% and quad-play penetration stood at 11.3%. ARPU grew by 4.9% to £45.88, while churn remained flat at 1.3%.

Virgin Media now has 13.387 million RGUs, with 4.208 million broadband customers, 3.752 million TV customers, 4.328 million fixed phone customers and 1.097 million contract mobile customers.

“This performance was driven by our ability to offer households and businesses an increasingly differentiated range of digital services,” said Neil Berkett, CEO. “Going forward, we’ll continue to differentiate our propositions by proactively exploiting the advantages of our network and our mobile capability.”

Berkett announced the initiation of a £700m capital return programme, which he said was possible as a result of the company’s improved performance. The company will repurchase up to £375m of its stock over the next 12 months, beginning with an immediate plan to buy back £125m of shares.