Published On: Fri, Jan 29th, 2016

Sky Boosts Operating Profit By 12% to £747 Million


Sky announced that it would be increasing its dividend from 12.3p to 12.6p.

Today Sky released its trading results for the six months ended 31 December 2015 to investors.

The company noted that it continued to make strong progress through investments in content and innovation whilst converting the strategy into strong revenue and profit growth. The business gained a new 337,000 customers in Q2 totalling its retail customer base to 21.5 million.

Revenue growth was up 5% for the period to £5,718 million from £5,437 million and through a strong focus on reducing operating costs this converted into a 12% increase in operating profit of £747 million.

The companies growth consisted of a 6% improvement in the UK and Ireland to £4,072 million (2015: £3,831 million) while Germany grew 10% to £693 million (2015: £628 million) however Italy’s revenues were down 3% to £953 million (2015: £978 million) due to lower average customers and the absence of advertising revenues from the 2014 FIFA World Cup.

Jeremy Darroch, Group Chief Executive said:

“We have had another very strong half as we continue to transform Sky, broadening our business and expanding into new markets and customer segments. This strategy is delivering today and opening up significant growth opportunities for the future. We are pursuing those opportunities with energy and purpose.

“Today’s results show that our approach is working and customers are responding in record numbers. Over 337,000 new customers joined Sky in the second quarter and we sold 1.1 million extra paid-for products. This has delivered strong financial performance with revenue growth of 5%, a 12% increase in operating profit and 10% growth in earnings per share.

“All of our markets are now clearly benefiting from our leadership in content and innovation and being part of the broader Sky. The launch of Sky Q will redefine our top-end TV experience and extend our market-leading portfolio of products to serve the needs of every customer.

“We have extended our lead in content with a ground-breaking new long-term deal with Showtime, which complements both Sky’s original productions and our partnership with HBO to make Sky Atlantic the best destination for world-class drama across Europe. This will bring customers the return of great shows that include Fortitude, Game of Thrones and The Affair alongside new productions such as Vinyl, Billions and The Young Pope.

“We have also announced that Nick Ferguson, our Chairman since 2012, will step down from the Sky Board at the end of April after 12 years as a Director. The entire Board offers its warmest thanks to Nick for his leadership as Chairman and the major contribution he has made to Sky over many years. We’re delighted that James Murdoch has agreed to step into the role of Chairman. James’ deep knowledge of the international media industry and his passion for supporting Sky’s ongoing success will make an even greater contribution to our business in the future.

“We’re excited about 2016 and we start the year with good momentum. With an outstanding set of new initiatives and products for our customers, we are well positioned to deliver further strong growth and returns for shareholders.”

Due to the strong performance, Sky said its Board has decided to declare a 2% increase in the interim dividend to 12.6 pence.

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