Improvements in broadband speeds and consumer demand for on-demand television has helped troubled cable operator Virgin Media report an up-beat set of first quarter results.
The loss-making cable operator, formerly known as NTL Telewest, reported a net gain of 4,900 new customers in the first three months of 2008. Virgin Media also reported 36,800 net new additions to its cable television service, 88,400 net new additions to its broadband service and 29,000 additional customers to its landline telephony network. However, these additions largely came from existing customers adding additional services to their accounts.
Virgin also reported a monthly churn rate of 1.2 per cent.
Operating income before depreciation, amortisation and other charges was 324.2 million in the quarter, on revenue of 1 billion. Operating losses fell to 4.6 million from 15.3 million in the same quarter in 2007.
"Our first-quarter results represent another solid operational performance. In particular, churn continued to decline, reflecting the emphasis that we have placed on this area," said Virgin Media's chief executive Neil Berkett.
The company is aggressively pushing its cable broadband service, and its ability to offer higher bandwidth throughput than current UK DSL services.
"We plan to launch a 50Mb broadband service during the course of this year. This will mean that by the end of the year, we plan to have four tiers of broadband service at 2Mb, 10Mb, 20Mb and 50Mb, with top headline speeds well ahead of our DSL competitors" the company stated in its results statement.
Virgin Media has 3.5 million cable broadband subscribers in the UK, along with 300,000 'off-net' customers not covered by its last-mile cable network, who buy a rebadged DSL service from Virgin.
