Cablevision swings to loss; spending up on CPE
Cablevision Systems swung to a first quarter loss, due in part to declining revenues in its cable TV unit. The company added a modest number of revenue generating units (RGUs), and increased average revenue per user (ARPU) by a little more than 1 percent, to $156.34.
Cablevision president and CEO James Dolan noted that “Cablevision started the year off delivering sequential growth in our customer relationship, high-speed data and voice subscriber metrics, all while continuing to recover from the impact of Superstorm Sandy.”
The company reported that its cable TV unit, which makes up the vast bulk of its business, saw first quarter 2013 net revenue decrease 0.7 percent to $1.35 billion, which it said was principally due to lower video revenues and a decrease in advertising revenues largely offset by the impact of a high-speed data price increase and continued growth of data and voice customers, compared to the prior year period.
Cablevision reported a total addition of approximately 5,200 customer relationships; that number includes a loss of 5,000 video subscribers, but gains of approximately 22,800 each in high-speed data and voice connections.
Many of the company’s peers reported that they had increased revenue in their first quarters as a result of price increases. Cablevision is likely to get a similar bump in its second quarter, according to Dolan, who said, “In the second quarter, we anticipate the positive impact of our recent pricing moves as well as an improved advertising outlook to lead to sequential improvement in our AOCF,” or adjusted operating cash flow.
Corporate revenue was down less than a percentage point, to $1.52 billion. Cablevision reported a Q1 ’13 loss of $16 million, compared to a profit of $57 million in first quarter of last year.
Capex spending on cable TV leapt from $150 million in the first quarter a year ago to $199 million in the most recently concluded quarter, with the biggest leap in the customer premise equipment (CPE) category.
The company said it accounted for the former Bresnan Communications, which it is in the process of selling to Charter Communications, as a discontinued business.