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Liberty Global spurred by Virgin Media gains

Liberty Global reported financial gains and strong momentum at UK-based Virgin Media in its latest quarter, despite a loss of 11,500 video customers across its footprint.

Liberty Global CEO, Mike Fries

For the second quarter, revenue from continuing operations was up 2.7% year-on-year to US$3.05 billion (€2.63 billion), while operating income was up 31.0% to US$263.9 million thanks to higher operating cash flow.

Liberty Global CEO Mike Fries said: “Our second quarter results were underpinned by continued momentum at Virgin Media, which generated record Q2 rebased revenue and subscriber growth, delivering a 4.1% top-line increase while adding 112,000 net RGU additions.”

At Virgin, Fries credited enhanced broadband speeds and the continued rollout of its V6 set-top box for driving growth, delivering “a substantial increase” in triple-play acquisitions, and increasing average revenue per-user (ARPU).

“Our other operations delivered mixed results, with Germany achieving a solid performance, offset by challenging competitive markets in Switzerland and Belgium,” he admitted.

Across its European footprint – not including discontinued European operations – Liberty reported a 42,900 increase in revenue generating units (RGU). However, this was driven by an increase in data and voice subscribers, which offset the 11,500 decline in video subscribers.

Liberty gained 48,400 video customers in the UK, but reported video losses in each of its other continuing markets, the largest of which came in Switzerland with a decline of 35,600 video customers.

Overall, the 11,500 decline in TV customers was less than the 16,200 video customers that Liberty lost in the same quarter a year earlier. It also continued to add customers to its next generation TV platforms, which include Horizon TV, Horizon-Lite, TiVo, Virgin TV V6 and Yelo TV.

In Q2 Liberty added 158,000 subscribers to its advanced platforms to reach 6.7 million advanced video customers – the equivalent of 77% of its total cable video base, excluding DTH.

It closed the three months ending June 30 with a total of 9.45 million video subscribers across its continuing operations footprint of the UK, Belgium, Switzerland, Ireland, Poland and Slovakia, including DTH customers.

Virgin Media’s reported gains were for the period before the operator’s recent spat with UKTV, which has seen it remove UKTV’s full line-up of channels from its electronic programme guide after the two parties failed to agree terms of a new carriage deal.