# Sirius Reports Record Revenue for 2Q



## Neil Derryberry (Mar 23, 2002)

Sirius Reports Record Revenue for 2Q

Over-delivering is the word at Sirius Satellite Radio - on subscriber numbers and satisfaction, on revenue, and on expectations. For the third time this year, Sirius is increasing its year-end guidance, expecting to obtain about 3 million subscribers, with revenue for the year to be $225 million, up 237 percent from 2004. The company also expects to have positive cash flow as early as Q4 of 2006. This just some of the encouraging news from company CEO Mel Karmazin on Tuesday's Q2 financial and operating results conference call.

Company officials are saying that continued momentum in the retail and automotive OEM distribution channels, and expectations of strong consumer demand for Sirius' exclusive programming - like the second year of NFL football, Martha Stewart Living Radio and the highly anticipated arrival of Howard Stern - are reasons why Sirius has revised its outlook on 2005.

"We beat Wall Street consensus expectations on all important metrics through a continuing focus on sound business execution, while maintaining low churn and very high levels of customer satisfaction," Karmazin said. "Going into the second half of the year, we believe that creative new programming, additional automotive factory programs and the introduction of exciting new products will continue to drive our strong growth for the future."

Sirius reported Q2 revenue of $52.2 million, a 295 percent increase over the $13.2 million reported for the same quarter last year. Average monthly churn during the second quarter of 2005 was "astonishingly low" at 1.4 percent. The company reported subscriber acquisition costs (SAC) per gross subscriber addition of $160, a 32 percent improvement over 2004 Q2 SAC of $234.

The company also recently extended its exclusive deal with Ford into 2011, with the option for Ford to extend it even further into 2013. Sirius said it expects this relationship to produce one million new subscribers over 2006-2007 model years, with its Diamond Chrysler factory installation program expected to contribute an additional 500,000 this year and next.

http://www.skyreport.com (used with permission)


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