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Sky reports record annual profits of £1.2bn

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Sky has weathered the ongoing economic gloom in the UK and Ireland to post record profits over the past year, following strong growth in demand across all of its services.

The pay-TV giant today reported a 14% increase in operating profit in the 12 months ending June 30 to reach £1.223 million - a record level for the broadcaster. Revenue was up 3% year-on-year to £6.791m.

Total customers taking services from the company hit 10.6 million over the year, an overall increase of 312,000.

Sky's broadband service is now delivered to 4m customers, while total TV subscribers grew by 101,000 over the 12 months.

An additional half a million Sky homes subscribed to the firm's high definition TV service over the year, taking the total customer base to 4,343,000.

Sky said that a total of 3.4 million customers now take a 'triple play' service of broadband, phoneline and TV from the firm, up 21% year-on-year.

The strong financial and operation performance resulted in Sky's share price increasing 2% when the FTSE 100 opened for business today.

It also outlined why Rupert Murdoch's News Corporation was so keen to snap up the remaining 60.9% of the business that it did not already own last year. The takeover bid was ultimately aborted after public pressure following the phone hacking scandal at Murdoch's UK newspapers.

Sky chief executive Jeremy Darroch, who recently agreed a multi-billion dollar new deal to Premier League TV rights, said that the firm had succeeded with a "consistent approach of investing where it matters most to customers and improving efficiency behind the scenes is working extremely well".

"In what remains a tough economic environment, customers are choosing Sky over other providers," Darroch said.

"We've continued to add new households and existing customers are remaining loyal and taking more products from us.

"More than nine million homes are now choosing to watch their TV through Sky, we're helping more customers to save money in home communications and innovative services like Sky Go are adding even more value to their subscription."

Ofcom is currently investigating whether Sky and Murdoch's News Corp remains 'fit and proper' to retain a UK broadcasting licence following the hacking affair.

But Darroch pointed to a recent Sky-commissioned report that indicated the firm contributes more than £5bn to UK GDP and supports almost 120,000 jobs.

He also noted the "wonderful achievement" of Team Sky and Bradley Wiggins, after they recently became the first British winners of the Tour De France.

"These are good examples of the important economic and social contribution that a successful British company can make and we hope to do even more in the future," Darroch stressed.

Also today, Sky announced plans to launch a broadband and talk services in the Republic of Ireland next year, and confirmed a deal with TalkTalk to wholesale its major channels on the firm's upcoming YouView service.

Sky has further agreed a deal to bring Channel 5's Demand 5 service to its Sky+ customers later in 2012, following previously announced agreements to the BBC and ITV's catch-up TV offerings.

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