Suddenlink posts 7.6% profit increase in Q3
Suddenlink Communications posted a 7.6 percent revenue increase for the third quarter that was driven by subscriber additions in its triple-play services.
Suddenlink and parent company Cequel Communications reported earnings this morning for the third quarter that ended Sept. 30. Suddenlink, the nation's seventh-largest cable operator, had third-quarter pro forma revenues of $423.2 million, while its revenues for the first nine months of this year grew 7.3 percent to $1.3 billion.
Suddenlink's operating costs and expenses rose 6.3 percent, primarily due to higher programming costs, increased telephone service costs, increased net compensation and employee-related expenses, increased contract labor expense, and higher bad debt expenses.
Net loss was $5.8 million for the third quarter, compared with a net loss of $7.2 million for the third quarter of 2009.
Suddenlink's revenue-generating units (RGUs) increased by 76,200 for the third quarter and 236,900 year-over-year, for an 8.5 percent annual gain. The company's average revenue per basic subscriber increased by 11 percent to $114.74 per month.
"We achieved exceptional financial and operating results in the third quarter and a record-setting pace for net RGU gains in the first nine months of the year," said Suddenlink Chairman and CEO Jerry Kent. "These results continue to validate the strategic investments we're making in our employees, infrastructure, services and the experience customers have with Suddenlink."
While video revenues increased by 2.1 percent in the third quarter – due to basic rate increases and increases in premium service revenue, as well as growth in digital subscribers and advanced video services – Suddenlink lost 4,900 basic subscribers in the quarter compared with 8,400 in the same quarter a year ago. Year-over-year, the cable operator lost 34,000 basic video subscribers.
Digital video customers increased by 98,300 subscribers over the last 12 months and increased by 33,900 during the third quarter, compared with an increase of approximately 16,200 during the same quarter a year ago.
Suddenlink's data revenues increased 10.8 percent, due to a gain of 80,800 residential subscribers over the last 12 months, and to growth in commercial high-speed Internet services to small- and medium-size businesses (SMBs), as it added approximately 3,100 commercial high-speed Internet customers over the last 12 months.
Residential high-speed Internet customers grew by 24,700 subscribers during the third quarter, compared with a gain of 24,300 during the same quarter a year ago.
Telephone revenues increased 26 percent, primarily due to an increase in residential telephone customers of 92,200 over the past year, and to growth in commercial telephone services to SMBs, as Suddenlink added 5,700 commercial telephone customers over the past 12 months.
Suddenlink said its voice growth was partially offset by average revenue per unit declines in its residential telephone product as a result of bundling and promotional discounts. Residential telephone customers grew by 22,500 during the third quarter, compared with a gain of 26,300 during the third quarter of 2009.
Advertising revenues increased 15 percent due to higher local and national advertising sales revenues, including political and automotive advertising.
Other revenues increased 12 percent due to, among other things, increased converter rental revenues for high-definition and DVR-capable digital converters, increased home networking revenues, and higher franchise and administrative fees.