Sky edges closer to 9m subscribers

Sky has recorded 56,000 net customer additions in the three months to March 31 - a 10% improvement on the same period last year - bringing its total number of subscribers to 8.89m.

Of those, 3.39m are Sky+ users, with 262,000 customers having signed up to the personal video recorder service in the third quarter. Sky's high definition product gained 43,000 subscribers, taking it to a total 465,000.

Sky also recorded its lowest third quarter customer churn in four years of 10%. The company has been aiming to reduce the rate at which subscribers leave for several years. The average revenue per user was £424, up from £421 in the previous quarter.

Revenue for the year so far has increased by 10% to £3.71bn, while operating profit is down 18% to £504m. The firm has invested £127m in broadband and telephony and £20m in purchasing Easynet during the period.

The overall loss for the nine months to March 31 was £118m, down from a £388m profit for the same period in the previous year largely because of Sky's stake in ITV. The company has recorded a £474m impairment loss as ITV's share price continues to decline.

Sky credited its gains to a stronger uptake of premium products such as Sky+ and HD, and the introduction of a cross-product installation charge.

"A reduction in short-term viewing package discounts and the implementation of an installation charge across all products are contributing to the long-term health of the business," it said. "While these actions impact gross additions, the benefits can be seen in customer loyalty, with third quarter churn of 10.5% at its lowest level for four years, and good growth in ARPU, which reached £424."

Chief executive Jeremy Darroch said: "We are reporting a strong set of results today. We are delivering for customers through a combination of great quality, value and service. As a result, more customers are choosing Sky, they are more satisfied and they are taking more products than ever before.

"In the third quarter, despite a difficult consumer environment, customer growth increased by 10% on last year and third-quarter churn was at a four-year low.

"The success of our strategy is reflected in our financial performance. Revenue growth of 10%, increased quarterly profitability and reducing broadband losses put us on track to achieve our targets."