FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule 13a - 16 or 15d - 16 of
the Securities Exchange Act of 1934
For the month of May 2005
04 May 2005
BRITISH SKY BROADCASTING GROUP PLC
(Name of Registrant)
Grant Way, Isleworth, Middlesex, TW7 5QD England
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F
Form 20-F X Form 40-F
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934
Yes No X
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): Not Applicable
EXHIBIT INDEX
Exhibit
EXHIBIT NO.1 Press release of British Sky Broadcasting Group plc
announcing 3rd Quarter Results released on
04 May 2005
4 May 2005
BRITISH SKY BROADCASTING GROUP PLC
Results for the nine months ended 31 March 2005
BSkyB announces 95,000 net DTH subscriber additions for the third quarter,
31% year on year growth in operating profit (before goodwill) and a 51%
increase in earnings per share (before goodwill and exceptional items) to
19.9 pence
- Net DTH subscriber growth of 95,000 (2004: 66,000) in the quarter to over
7.7 million (2004: 7.3 million)
- Sky+ households increase by 128,000 (2004: 72,000) in the quarter to 770,000
(2004: 322,000)
- Multiroom households increase by 90,000 (2004: 33,000) in the quarter to
563,000 (2004: 270,000)
- Turnover increases by 10% to GBP2,960 million
- Operating profit before goodwill increases by 31% to GBP574 million, a
margin of 19.4%
- Operating cash inflow increases by 23% to GBP635 million
- Profit after tax before goodwill and exceptional items up 49% to
GBP381 million
- Profit after tax increases by 12% to GBP273 million
- Earnings per share before goodwill and exceptional items increase by 51%
to 19.9 pence
- Net debt reduced to GBP414 million after returning GBP291 million through a
share buy-back programme
Commenting on the announcement, James Murdoch, Chief Executive said:
"Continued focus on the implementation of our strategy is returning strong
subscriber growth, a good mix of customers, growth in Sky+ and multiroom, and
substantial profit and cashflow. The whole team at Sky put in a strong
performance to deliver these results and we remain focussed and energetic in
pursuing our long-term growth plan."
Results highlights
------------------------------------------------- --------------- --------------- -------------- ---------------
Key subscriber information 2005 2004 Change % Change
Net DTH subscriber additions(1) 95,000 66,000 29,000 44%
Total DTH subscribers(2) 7,704,000 7,274,000 430,000 6%
Net Sky+ household additions(1) 128,000 72,000 56,000 78%
Total Sky+ households(2) 770,000 322,000 448,000 139%
Net multiroom household additions(1) 90,000 33,000 57,000 173%
Total multiroom households(2) 563,000 270,000 293,000 109%
------------------------------------------------- --------------- --------------- -------------- ---------------
------------------------------------------------- ---------------------------------------------- ---------------
Profit and loss account (GBPm) Nine months to 31 March
2005 2004 Change % Change
Turnover 2,960 2,697 263 10%
Operating profit before goodwill(3) 574 438 136 31%
Operating profit margin before goodwill 19.4% 16.2% 3.2% 20%
Profit before taxation, goodwill and 539 371 168 45%
exceptional items(3)
Profit after taxation before goodwill and 381 255 126 49%
exceptional items(3)
Profit after taxation 273 243 30 12%
------------------------------------------------- --------------- --------------- -------------- ---------------
------------------------------------------------- ---------------------------------------------- ---------------
Cashflow information (GBPm) Nine months to 31 March
2005 2004 Change % Change
Operating cash inflow 635 518 117 23%
Net debt(4) 414 662 -248 -37%
------------------------------------------------- --------------- --------------- -------------- ---------------
------------------------------------------------- ---------------------------------------------- ---------------
Per share information (pence) Nine months to 31 March
2005 2004 Change % Change
Earnings per share before goodwill and 19.9 13.2 6.7 51%
exceptional items(3)
Earnings per share 14.2 12.5 1.7 14%
------------------------------------------------- --------------- --------------- -------------- ---------------
1. In the three months to 31 March
2. As at 31 March
3. The reconciliation to the nearest equivalent GAAP measure can be found in
the Consolidated Profit and Loss Account below
4. Net debt reduced to GBP414 million at 31 March 2005 from GBP662 million at
31 March 2004 after returning GBP407 million to shareholders between
1 April 2004 and 31 March 2005
Enquiries:
Analysts/Investors:
Robert Kingston Tel: 020 7705 3726
E-mail: investor-relations@bskyb.com
Press:
Julian Eccles Tel: 020 7705 3267
Robert Fraser Tel: 020 7705 3036
E-mail: corporate.communications@bskyb.com
Finsbury:
Alice Macandrew Tel: 020 7251 3801
A conference call for UK and European analysts and investors will be held at
8.30 a.m. (BST) today. To register for this, please contact Silvana Marsh at
Finsbury on +44 20 7251 3801. A live webcast of this call will be available on
Sky's corporate website, http://www.sky.com/corporate and available to replay.
There will be a separate conference call for US analysts and investors at 10.00
a.m. (EST) today. Details of this call have been sent to US institutions and can
be obtained from John Sutton at Taylor Rafferty on +1 212 889 4350.
OPERATING REVIEW
At 31 March 2005, the total number of direct-to-home ("DTH") digital satellite
subscribers in the UK and Ireland was 7,704,000, representing a net increase of
95,000 subscribers in the three months to 31 March 2005 ("the quarter"). The
Group remains on track to achieve its target of eight million DTH subscribers by
31 December 2005.
Gross DTH subscriber additions for the quarter were 308,000, an increase of
72,000 on the prior year. This is the second consecutive quarter that gross
additions have exceeded the levels set 12 months previously and demonstrates the
Group's ability to stimulate continued demand for pay television in a
competitive and dynamic environment.
The number of Sky+ households grew strongly, increasing by 128,000 in the
quarter to 770,000, representing 10% penetration of total DTH subscribers.
Whilst offering an attractive upgrade for existing Sky subscribers, Sky+ also
attracts consumers who previously had not chosen Sky. One third of new Sky+
households in the quarter were first-time subscribers, higher than the two
preceding quarters and significantly higher than the 21% achieved last financial
year. As highlighted in August 2004, this has been a key area of focus.
The growth in Sky+ penetration continues to drive growth in the number of
households taking two or more subscriptions, with over 50% of Sky+ subscribers
taking two or more subscriptions as at 31 March 2005. The total number of
multiroom households increased by 90,000 in the quarter to 563,000, 7%
penetration of total DTH subscribers.
DTH churn (annualised) for the nine months to 31 March 2005 ("the period") was
10.2%, an increase of 0.8% percentage points over the nine months to 31 March
2004 ("the comparable period"). Churn (annualised) for the quarter was 11.1%
following a lower level of reinstates from retention marketing activity. The
Group expects churn to remain at around 10% over time.
Annualised average revenue per DTH subscriber ("ARPU") in the quarter was
GBP382, in-line with the three months to 31 March 2004. ARPU for the quarter was
GBP4 lower than the three months to 31 December 2004 ("the second quarter")
reflecting a GBP1 decrease in DTH ARPU, principally driven by the seasonal
movement between subscription tiers following Christmas. ARPU generated from Sky
Active and SkyBet decreased by GBP3 on the second quarter.
During the quarter, Sky progressed the range of initiatives launched in the
second quarter. The 'What do you want to watch?' advertising campaign continued
in March 2005, promoting the range and depth of programming available from pay
television and encouraging consumers to re-appraise the Sky brand. Installation
charges continued to be waived on all popular Sky channel packages, eliminating
the higher upfront costs for subscribers not choosing the top tier 'Sky World'
package.
Good progress was made in the quarter in building the broadcast infrastructure
and production facilities required to launch high definition television ("HDTV")
in 2006. On 2 March 2005, Sky announced that Thomson will be the initial
supplier of HDTV set-top boxes, which will be integrated with personal video
recorder ("PVR") functionality. The introduction of HDTV to the current product
portfolio will offer our customers the highest quality viewing experience
available and further extend the range of products to meet the individual needs
of different consumers.
Sky Sports recorded its highest ever quarterly share of viewing in Sky digital
homes. In Rugby League, Super League audiences were up 30% on the same period
last year and in Football, this season's Carling Cup Final set a new viewing
record for any Cup match on Sky. The final quarter of the financial year also
features a strong line up of sporting events, as the domestic League and
European Cup competitions in Football and Rugby Union reach their final stages;
in International Cricket England challenge Australia and Bangladesh in the
Natwest Series; and the British and Irish Lions depart for their Rugby Union
tour of New Zealand. Sky Sports will provide the first view of Sir Clive
Woodward's team when they face the Pumas at the Millennium Stadium in Cardiff on
23 May 2005, and will provide live and exclusive coverage of all 11 matches from
their New Zealand Tour in June.
Sky One and Sky Movies performed well during the quarter, with the return of
flagship drama series on Sky One, such as '24' and the award winning 'Nip/Tuck,'
and premieres of 'Bruce Almighty' and 'The League of Extraordinary Gentlemen' on
Sky Movies, all achieving strong viewing share. As it continues to broaden its
appeal to subscribers, Sky One has announced that it will broadcast a new
wildlife series, 'Last Chance to Save', in the autumn and the pro-am golf
'Celebrity Cup' during the August Bank Holiday weekend.
On 25 February 2005, Sky News was named 'News Channel of the year' by the Royal
Television Society ("RTS") for the fourth year running, beating strong
competition from the BBC and ITV. Sky News' reputation has been built on its
fast and accurate coverage of breaking news, as well as its innovative approach
to covering stories as illustrated by its coverage of the 2005 General Election
campaign and its reconstructions of the current Michael Jackson trial.
FINANCIAL REVIEW
The Group has delivered a strong set of financial results during the period,
with a 51% increase in earnings per share (before goodwill and exceptional
items) over the comparable period. Operating profit before goodwill increased by
31% on the comparable period to GBP574 million, resulting in operating profit
margin before goodwill of 19.4%, up from 16.2% for the comparable period.
Total revenues increased by 10% on the comparable period to GBP2,960 million.
DTH revenues increased by 10% on the comparable period to GBP2,171 million. This
was mainly driven by 6% growth in the average number of DTH subscribers and a 3%
increase in the average revenue per DTH subscriber, mainly as a result of the
January and September 2004 prices rises and increased multiroom revenues.
Cable wholesale revenues increased by 4% on the comparable period to GBP166
million. Adjusting for a one-off receipt of audit monies received from NTL in
the first quarter of last financial year, this represents a 7% increase on the
comparable period. This has primarily been driven by the changes to wholesale
prices in January and September 2004 and the carriage of Sky Sports Extra and
PREMPLUS.
Advertising revenue increased by 9% on the comparable period to GBP242 million,
principally driven by 8% growth in the UK television advertising sector and
continued expansion in the Group's share of this sector.
Growth in SkyBet revenues accelerated during the quarter to reach GBP186 million
for the period, a 40% increase on the comparable period. The introduction of new
fixed odds games, such as Roulette and multi-line slot games, continued to drive
gross margins, which increased by 2 percentage points on the comparable period
to 10%. On 8 April 2005, the Gambling Bill was successfully passed through
Parliament, which will present further opportunities from the end of 2006 for
SkyBet and Sky Active to continue to extend the range of gaming services that
they provide.
Lower revenues from the SkyBuy retail service, and from the expiry of a number
of contracts and services, led to a 22% reduction in Sky Active revenues on the
comparable period to GBP67 million. Underlying revenues in Sky Active (excluding
these items) rose by 5% to GBP62 million, reflecting growth in areas such as
interactive advertising, games and third party betting and gaming.
Total programming costs decreased by GBP32 million on the comparable period to
GBP1,216 million. Sports costs increased by GBP7 million on the comparable
period to GBP571 million. After adjusting for the change in amortisation
phasing, as disclosed previously, sports costs would have fallen by GBP43
million on the comparable period. This underlying reduction is principally due
to savings achieved in the renewal of the FA Premier League and Football
Association contracts. Other programming costs, including Movies, News,
Entertainment and Third Party Channels, reduced by GBP39 million on the
comparable period to GBP645 million, principally as the result of the continued
weakness of the US dollar.
Gross margin (defined as total revenues less total programming costs, divided by
total revenue) increased from 54% for the comparable period to 59%.
Marketing costs increased by GBP80 million to GBP379 million, 13% of total
revenue. This increase reflects strong growth in gross additions and in the
number of existing subscribers upgrading to Sky+ and multiroom. These upgrades
generate high levels of customer satisfaction, lower churn and a higher uptake
of premium packages and multiroom subscriptions. Whilst upgrades to existing
customers do increase marketing costs in the short-term, they offer increased
yield and attractive returns on investment. Above-the-line marketing costs are
higher than the comparable period due to the continuation of the "What do you
want to watch" campaign, launched on 1 October 2004. Year on year growth in
above-the-line costs declined during the quarter to 47% as the campaign moved
out of launch phase. The Group expects above-the-line marketing costs to
increase by 40% to 50% in the 2005 financial year compared to the 2004 financial
year, in line with previous guidance.
Betting costs increased by GBP45 million to GBP168 million, in line with the
increase in SkyBet revenue. The remaining other operating costs, including
subscriber management, transmission and related functions and administration
costs, increased by GBP34 million on the comparable period to GBP623 million.
This increase is primarily attributable to increased infrastructure and
broadcast support and development costs, including the Advanced Technology
Centre, IT systems and facility costs.
Operating profit before goodwill increased by 31% on the comparable period to
GBP574 million. Operating profit margin before goodwill increased by 3.2
percentage points to 19.4%, despite the small negative mix effect of the strong
growth in SkyBet revenue in the period.
After goodwill of GBP85 million, the Group's share of operating profits of joint
ventures and associates of GBP12 million, loss on disposal of the Group's share
in Granada Sky Broadcasting of GBP23 million (as disclosed in the second
quarter) and net interest payable of GBP47 million, the Group made a profit
before tax of GBP431 million.
The total net tax charge for the period was GBP158 million. This reflects a
current tax charge of GBP109 million, a deferred tax charge of GBP50 million and
a GBP1 million tax credit from the Group's share of the tax balances in
associated undertakings. Excluding the effect of goodwill, joint ventures and
exceptional items, the Group's effective tax rate on ordinary activities
increased from 29.9% for the comparable period to 30.7%, as a result of a
decrease in the proportion of allowable tax deductions.
The mainstream corporation tax liability for the period was GBP114 million and,
in accordance with the quarterly instalment regime, GBP39 million was paid in
April 2005.
Profit after tax for the period grew by 12% on the comparable period to GBP273
million. The rate of growth was lower than operating profit due to a net
movement of GBP98 million in exceptional items, principally resulting from the
disposal of the Group's shareholdings in QVC and Manchester United plc last
financial year. Earnings per share, before goodwill and exceptional items,
increased by 6.7 pence on the comparable period to 19.9 pence.
Earnings before interest, tax, depreciation and amortisation ("EBITDA"),
excluding exceptional items, increased by 24% on the comparable period to GBP644
million. Operating cashflow generation increased by 23% on the comparable period
to GBP635 million. After taking into account cash outflows, principally
comprising capital expenditure of GBP172 million, the share buy-back programme
of GBP293 million (including GBP2 million of stamp duty and fees), dividend
payments relating to the final dividend for the 2004 financial year of GBP63
million, net interest payable of GBP61 million and taxation of GBP64 million,
the Group reduced net debt marginally from GBP429 million at 30 June 2004 to
GBP414 million at 31 March 2005.
Capital expenditure increased by GBP76 million on the comparable period to
GBP172 million with further good progress being made on the Group's
infrastructure programme in line with the plans outlined on 4 August 2004.
IFRS
The Group is required to adopt International Financial Reporting Standards
('IFRS') in the preparation of its consolidated financial statements from 1 July
2005. The Group's first results reported under IFRS will therefore be the
results for the quarter ended 30 September 2005. In order to provide comparative
information under IFRS in advance, the Group intends to release its results for
the year to 30 June 2005, restated under IFRS, in September 2005. Information
regarding the Group's transition to IFRS was provided in the Group's 2004 Annual
Report and the Group's interim results presentation on 2 February 2005.
DIVIDEND
On 2 February 2005, the Directors declared an interim dividend of 4 pence per
Ordinary Share. This dividend was paid on 22 April 2005 to shareholders of
record on 1 April 2005. The total amount paid was GBP75 million and this will be
recognised in the consolidated cashflow statement in the fourth quarter.
CORPORATE
At the Company's AGM on 12 November 2004, Sky received approval from
shareholders to repurchase up to 97 million shares, representing approximately
five percent of issued share capital. During the quarter, Sky repurchased for
cancellation 28.5 million shares for a total consideration of GBP165 million,
including stamp duty and commissions. As at 31 March 2005, 51.3 million shares,
representing approximately 2.6% of issued share capital had been repurchased and
the total number of shares outstanding was 1,890,501,108.
In August 2004, the Group announced its intention to increase the level of
distributable reserves of British Sky Broadcasting Group plc. On 1 April 2005
the Group announced that BSkyB Investments Limited, a newly-formed subsidiary of
British Sky Broadcasting plc, had applied to the High Court for a reduction of
its share capital. This application was approved by the High Court on 13 April
2005 and has resulted in an increase in the level of distributable reserves
available to British Sky Broadcasting plc.
Use of non-GAAP financial information
This results announcement contains certain information on the Group's results
and cash flows that have been derived from amounts calculated in accordance with
UK Generally Accepted Accounting Principles ("UK GAAP"), but are not themselves
UK GAAP measures. These should not be viewed in isolation as alternatives to the
equivalent UK GAAP measure and should be read in conjunction with the equivalent
UK GAAP measures. Further disclosures are also provided under "Use of Non-GAAP
Financial Information" in Appendix 2.
Forward-looking statements
This document contains certain forward-looking statements within the meaning of
the United States Private Securities Litigation Reform Act of 1995 with respect
to the Group's financial condition, results of operations and business, and
management's strategy, plans and objectives for the Group. These statements
include, without limitation, those that express forecasts, expectations and
projections with regard to DTH subscriber growth, churn and marketing
expenditure.
These statements (and all other forward-looking statements contained in this
document) are not guarantees of future performance and are subject to risks,
uncertainties and other factors, some of which are beyond the Group's control,
are difficult to predict and could cause actual results to differ materially
from those expressed or implied or forecast in the forward-looking statements.
These factors include, but are not limited to, the fact that the Group operates
in a highly competitive environment, the effects of government regulation upon
the Group's activities, its reliance on technology, which is subject to risk,
change and development, its ability to continue to obtain exclusive rights to
movies, sports events and other programming content, risks inherent in the
implementation of large-scale capital expenditure projects, the Group's ability
to continue to communicate and market its services effectively, and the risks
associated with the Group's operation of digital television transmission in the
UK and Ireland.
Information on some risks and uncertainties are described in the "Risk Factors"
section of Sky's Interim Report on Form 6-K for the period ended 31 December
2004. Copies of the Interim Report on Form 6-K are available on request from
British Sky Broadcasting Group plc, Grant Way, Isleworth TW7 5QD or from the
British Sky Broadcasting web page at www.Sky.com/corporate. All forward-looking
statements in this document are based on information known to the Group on the
date hereof. The Group undertakes no obligation publicly to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
Appendix 1
Subscribers to Sky Channels
Prior quarter Prior year Opening
Q3 2005 Q2 2005 Q3 2004 Q4 2004
as at as at as at as at
31/03/05 31/12/04 31/03/04 30/06/04
DTH homes1,2 3 7,704,000 7,609,000 7,274,000 7,355,000
Total TV homes in the UK and Ireland4 26,273,000 26,249,000 26,010,000 26,066,000
DTH homes as a percentage of 29% 29% 28% 28%
total UK and Ireland TV homes
Cable - UK 3,277,000 3,292,000 3,302,000 3,321,000
Cable - Ireland 584,000 584,000 575,000 574,000
Total Sky pay homes 11,565,000 11,485,000 11,151,000 11,250,000
Total Sky pay homes as a percentage of 44% 44% 43% 43%
total UK and
Ireland TV homes
Sky+ homes 770,000 642,000 322,000 397,000
Multiroom homes5 563,000 473,000 270,000 293,000
DTT - UK 6 4,674,000 4,216,000 2,695,000 3,084,000
1: Includes DTH subscribers in Republic of Ireland (355,000, as at 31 March
2005).
2: DTH subscribers includes only primary subscriptions to Sky (no additional
units are counted for Sky+ or multiroom subscriptions). This does not
include customers taking Sky's freesat offering or churned customers viewing
free-to-air channels.
3: DTH homes include subscribers taking Sky packages through Kingston
Interactive Television and Homechoice.
4: Total UK homes estimated by BARB and taken from the beginning of the month
following the period end (latest figures as at 1 April 2005). Total
Ireland homes estimated by Nielsen Media Research, conducted on an
annual basis in July with results available in September (latest figures as
at July 2004).
5: Multiroom includes households subscribing to more than one set-top box.
(No additional units are counted for the second or any subsequent
multiroom subscriptions.)
6: DTT homes estimated by BARB and taken from the beginning of the following
month (latest figures as at 1 April 2005). These include Sky or Cable
homes that already take multichannel TV.
Appendix 2
Use of Non-GAAP Financial Information
A summary of certain non-GAAP measures included in this results announcement,
together with the most comparable GAAP measure and descriptions of certain
non-GAAP measures, is shown below.
--------------------------------------------- ----------------------------------------------------------
Non-GAAP measure Most comparable GAAP measure
--------------------------------------------- ----------------------------------------------------------
Operating profit before goodwill Operating profit
--------------------------------------------- ----------------------------------------------------------
Profit before taxation, goodwill and Profit before taxation
exceptional items
--------------------------------------------- ----------------------------------------------------------
Profit after taxation before goodwill and Profit after taxation
exceptional items
--------------------------------------------- ----------------------------------------------------------
Earnings per share before goodwill and Earnings per share
exceptional items
--------------------------------------------- ----------------------------------------------------------
--------------------------------------------- ----------------------------------------------------------
EBITDA Operating profit
--------------------------------------------- ----------------------------------------------------------
Glossary
--------------------------------------------- ----------------------------------------------------------
Useful definitions Description
--------------------------------------------- ----------------------------------------------------------
ARPU Average Revenue Per User: the amount spent by the
Group's residential subscribers in the quarter, divided
by the average number of residential subscribers in the
quarter, annualised.
--------------------------------------------- ----------------------------------------------------------
Churn The rate at which subscribers relinquish their
subscriptions, expressed as a percentage of total
subscribers.
--------------------------------------------- ----------------------------------------------------------
Digibox Digital satellite reception equipment.
--------------------------------------------- ----------------------------------------------------------
EBITDA Earnings before interest, taxation, depreciation and
amortisation is calculated as operating profit before
depreciation and amortisation or impairment of goodwill
and intangible assets.
--------------------------------------------- ----------------------------------------------------------
Effective tax rate Corporation tax charge expressed as a percentage of
Profit before Tax, goodwill, interest, exceptional items
and share of results of joint ventures.
--------------------------------------------- ----------------------------------------------------------
Mainstream Corporation Tax liability Current corporation tax charge for the year.
--------------------------------------------- ----------------------------------------------------------
Multichannel viewing share Share of viewers of non-analogue terrestrial television.
--------------------------------------------- ----------------------------------------------------------
Multiroom Installation of one or more additional digiboxes in the
household of an existing subscriber.
--------------------------------------------- ----------------------------------------------------------
PVR Personal Video Recorder: Digital TV receiver which
utilises a built in hard disk drive to enable viewers to
record without videotapes, pause live TV, and record one
programme while watching another.
--------------------------------------------- ----------------------------------------------------------
Sky + Sky's fully-integrated Personal Video Recorder (PVR) and
satellite decoder.
--------------------------------------------- ----------------------------------------------------------
Viewing share Number of people viewing a channel as a percentage of
total viewing audience.
--------------------------------------------- ----------------------------------------------------------
British Sky Broadcasting Group plc
Consolidated Profit and Loss Account for the nine months ended 31 March 2005
--------------------------------------------------------------------------------------------------------------------------
Before 2004/05
goodwill Goodwill Nine Before 2003/04
and and months goodwill Goodwill Nine months
exceptional exceptional ended and and ended
items items 31 March exceptional exceptional 31 March
Total items items Total
GBPm GBPm GBPm GBPm GBPm GBPm
Notes (unaudited) (unaudited)(unaudited) (unaudited) (unaudited) (unaudited)
--------------------------------------------------------------------------------------------------------------------------
Turnover: Group and share of joint
ventures' turnover 3,012 - 3,012 2,759 - 2,759
Less: share of joint ventures' turnover (52) - (52) (62) - (62)
Group turnover 1 2,960 - 2,960 2,697 - 2,697
--------------------------------------------------------------------------------------------------------------------------
Operating expenses, net 2 (2,386) (85) (2,471) (2,259) (87) (2,346)
--------------------------------------------------------------------------------------------------------------------------
EBITDA 644 - 644 518 - 518
Depreciation (70) - (70) (80) - (80)
Amortisation 2 - (85) (85) - (87) (87)
--------------------------------------------------------------------------------------------------------------------------
Operating profit 574 (85) 489 438 (87) 351
--------------------------------------------------------------------------------------------------------------------------
Share of joint ventures' and associates'
operating results 12 - 12 (4) - (4)
Loss on disposal of investments in joint
ventures 3 - (23) (23) - - -
Profit on disposal of fixed asset
investments 3 - - - - 51 51
Amounts written back to fixed asset
investments, net 3 - - - - 24 24
Profit on ordinary activities before
interest and taxation 586 (108) 478 434 (12) 422
--------------------------------------------------------------------------------------------------------------------------
Interest receivable and similar income 22 - 22 5 - 5
Interest payable and similar charges (69) - (69) (68) - (68)
Profit on ordinary activities before
taxation 539 (108) 431 371 (12) 359
--------------------------------------------------------------------------------------------------------------------------
Tax on profit on ordinary activities (158) - (158) (116) - (116)
Profit on ordinary activities after taxation 381 (108) 273 255 (12) 243
--------------------------------------------------------------------------------------------------------------------------
Equity dividends (77) (53)
Retained profit for the period 196 190
--------------------------------------------------------------------------------------------------------------------------
Earnings per share - basic 19.9p (5.7p) 14.2p 13.2p (0.7p) 12.5p
Earnings per share - diluted 19.9p (5.7p) 14.2p 13.2p (0.7p) 12.5p
--------------------------------------------------------------------------------------------------------------------------
British Sky Broadcasting Group plc
Consolidated Profit and Loss Account for the three months ended 31 March 2005
------------------------------------------------------------------------------------------------------------------------------
Before 2004/05 Before 2003/04
Goodwill Three months goodwill Goodwill Three months
and ended 31 and and ended 31
exceptional March 2005 exceptional exceptional March 2004
items Goodwill Total items items Total
GBPm GBPm GBPm GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited) (unaudited)(unaudited) (unaudited)
-------------------------------------------------------------------------------------------------------------------------------
Turnover: Group and share of joint ventures'
turnover 1,029 - 1,029 950 - 950
Less: share of joint ventures' turnover (14) - (14) (19) - (19)
Group turnover 1,015 - 1,015 931 - 931
-------------------------------------------------------------------------------------------------------------------------------
Operating expenses, net (795) (28) (823) (776) (29) (805)
-------------------------------------------------------------------------------------------------------------------------------
EBITDA 242 - 242 176 - 176
Depreciation (22) - (22) (21) - (21)
Amortisation - (28) (28) - (29) (29)
-------------------------------------------------------------------------------------------------------------------------------
Operating profit 220 (28) 192 155 (29) 126
-------------------------------------------------------------------------------------------------------------------------------
Share of joint ventures' and associates'
operating results 4 - 4 1 - 1
Profit on disposal of fixed asset investments - - - - 49 49
Profit on ordinary activities before interest
and taxation 224 (28) 196 156 20 176
-------------------------------------------------------------------------------------------------------------------------------
Interest receivable and similar income 7 - 7 2 - 2
Interest payable and similar charges (22) - (22) (23) - (23)
Profit on ordinary activities before taxation 209 (28) 181 135 20 155
-------------------------------------------------------------------------------------------------------------------------------
Tax on profit on ordinary activities (62) - (62) (42) - (42)
Profit on ordinary activities after taxation 147 (28) 119 93 20 113
-------------------------------------------------------------------------------------------------------------------------------
Equity dividends - -
Retained profit for the period 119 113
-------------------------------------------------------------------------------------------------------------------------------
Earnings per share - basic 7.8p (1.5p) 6.3p 4.8p (1.0p) 5.8p
Earnings per share - diluted 7.8p (1.5p) 6.3p 4.8p (1.0p) 5.8p
-------------------------------------------------------------------------------------------------------------------------------
Notes to Financial Statements
1 Turnover
The Group's turnover, whilst deriving from one class of business, has been
analysed as follows:
--------------------------------------------------------------------------------------------------------------------
2004/05 2003/04
Nine months Nine months
ended ended
31 March 31 March
GBPm GBPm
(unaudited) (unaudited)
--------------------------------------------------------------------------------------------------------------------
DTH subscribers 2,171 1,973
Cable subscribers 166 160
Advertising 242 223
Sky Bet (i) 186 133
Sky Active (i) 67 86
Other 128 122
2,960 2,697
--------------------------------------------------------------------------------------------------------------------
(i) Additional detail has been provided with regard to the analysis of
interactive revenues between the Group's betting and games revenues -
"Sky Bet" - and other interactive revenues - "Sky Active" - and the
prior year comparatives have been restated accordingly.
2 Operating expenses, net
--------------------------------------------------------------------------------------------------------------------
2004/05 2003/04
Nine months Nine months
ended ended
31 March Before 31 March
Before goodwill Goodwill Total goodwill Goodwill Total
GBPm GBPm GBPm GBPm GBPm GBPm
(unaudited) (unaudited)(unaudited) (unaudited) (unaudited)(unaudited)
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Programming (i) 1,216 - 1,216 1,248 - 1,248
Transmission and related
functions (i) 128 - 128 115 - 115
Marketing 379 - 379 299 - 299
Subscriber management 288 - 288 279 - 279
Administration 207 85 292 195 87 282
Betting 168 - 168 123 - 123
2,386 85 2,471 2,259 87 2,346
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(i) The amounts shown are net of GBP7 million (2003/04: nine months ended
31 March: GBP10 million) receivable from the disposal of programming
rights not acquired for use by the Group, and GBP22 million (2003/04:
nine months ended 31 March: GBP21 million) in respect of the provision to
third party broadcasters of spare transponder capacity.
3 Exceptional items
2004/05
(i) Loss on disposal of investments in joint ventures
On 1 November 2004, the Group sold its 49.5% investment in Granada Sky
Broadcasting for GBP14 million in cash, realising a loss on disposal of GBP23
million. This included the write back of GBP32 million of goodwill which had
previously been written off to reserves, as permitted prior to the
implementation of Financial Reporting Standard ("FRS") 10, "Goodwill and
Intangible Assets".
2003/04
(ii) Profit on sale of fixed asset investments
On 7 October 2003, the Group disposed of its listed investment in Manchester
United plc, realising a profit on disposal of GBP2 million.
On 1 March 2004, the Group sold its 20% shareholding in QVC (UK), operator of
QVC - The Shopping Channel, for GBP49 million in cash, realising a profit on
disposal of GBP49 million.
(iii) Amounts written back to fixed asset investments, net
The Group reduced its provision against its minority equity investments in
football clubs by GBP33 million, following the disposal of its investment in
Manchester United plc in October 2003 for GBP62 million in cash. The Group also
increased its provision against its remaining minority equity investments in
football clubs by a further GBP9 million.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BRITISH SKY BROADCASTING GROUP PLC
Date: 04 May 2005 By: /s/ Dave Gormley
Dave Gormley
Company Secretary