Q3 2011 results

From MediaGuardian:

Virgin Media has won back 6,300 cable customers in the three months to end of September, partly making up for losses of 36,000 over the summer after students disconnected for the holidays.
Financial results on Thursday showed that revenues grew 2.2% to £1bn year on year, marking a 3.3% rise for the first nine months of the year.
Overall cable customer numbers increased on the second quarter to 4.79 million. The number of telephone customers fell by 13,300 to 4.31 million, as use of mobile phones at home gradually replaces landline phone calls. Virgin says that customer 'churn' – the proportion of customers who quit – has increased, to 1.7%, although those leaving its network spend on average £38.30 a month, 20% less than the bulk of its customers.
The strategy of selling more to its existing customers led to a steady rise in ARPU (average revenue per user), up 3.2% so far this year, to £47.86 a month, which is Virgin's highest on record and compares with around £44.58 a month at rival BSkyB.
More customers are parting with extra cash for higher speed broadband and on its latest digital video recorder from TiVo, which is being promoted on television in an advertising campaign fronted by Hustle actor Marc Warren.
Chief executive Neil Berkett said: "Our results show that we're successfully serving what is a rapidly emerging market for better quality services. The demand for superior connectivity is accelerating as more people, regardless of their circumstances, recognise the best digital technology is worth paying more for."
Virgin had sold 222,000 TiVo subscriptions as of Wednesday, up from 36,000 at the end of June. The number of on-demand TV shows watched each month reached 80m, an increase of 10% on 2010, although that figure is likely to rise as TiVo adoption spreads.
The company said just over half of new customers are opting for high speed, 30 megabits per second (Mbps) broadband, with the number rising 178,000 to over half a million. The number of households taking 50Mbps or 100Mbps was 187,000, twice as many as a year ago.
Over 1 million customers – 26% of the cable base – are now taking over 20Mbps, the lowest tier of above basic speed. Operating income increased year on year from £102m to 128m, while the company made a loss before tax on continuing operations of £74m, compared with a profit of nearly 10m the year before. Virgin still has total debt of £5.7bn.
The company announced that it would use £250m of the £348m raised from the sale of its UKTV channels during the summer to expand its share buyback programme, which Goldman Sachs believes could see Virgin acquire 12% of its outstanding shares by the end of 2012. This takes to £1.25bn the total that will have been spend on buybacks since mid 2010. Goldman Sachs analysts said: "We believe these results validate management's efforts to grow customer lifetime value, with TiVo success creating helpful ARPU tailwinds for 2012."

And from the VM Press Release, this on their TV offering:

In the quarter we started to market and sell our new TiVo service to new customers and since July have been running our first TiVo TV advertising campaign. The strong early demand for this service has exceeded our high expectations and by the end of the quarter we had 162,900 TiVo customers, more than four times the number of customers with which we entered the quarter. We are seeing this demand for TiVo from both new and existing customers, with around one third of all TiVo subscribers being new to Virgin Media. Growth has continued strongly in October, and we had 222,000 TiVo customers as of 26th October.
Widespread consumer research supports trends we see within our customer base whereby people are increasingly using multiple devices simultaneously, such as watching TV while playing with a tablet device.
As we move to make TiVo the hub for all our customers’ entertainment needs, we are introducing a companion app later this year which will complement the TiVo television experience. This will replicate the graphical interface and functionality of the service while enabling customers to browse, search and control their TV through a tablet device.
Both our new and legacy TV services stand apart from other TV platforms in the UK with advantages which include access to an unparalleled library of on demand programming. After the quarter end we introduced even more content following an agreement with BSkyB. This will increase what is the largest on demand service available in the UK by over a third, as measured by both users and hours of content. We remain on track to meet our predictions of 1bn views for 2011. Around two-thirds of our TV base regularly used our ondemand TV service during the quarter, averaging 80m views each month, which is an increase of 10% from the same period in 2010.
We currently have around 3.8m TV customers, of which 1.8m or 49% are able to experience HD after a further 165,200 customers took an HD set-top box in the quarter. We recently announced the launch of five new HD channels from UKTV, taking the total number of HD channels available up to 36. In addition, the number of customers who subscribe to our Sky premium channels increased by 7% to 775,100, which represents 21% of all TV customers.
The number of paying TV customers increased by 28,800; however churn in the lowest free “M” tier, with 34,500 net disconnections, meant the total TV customer base fell by 5,700 in the quarter.
We are also about to launch our exclusive partnership with digital music service Spotify, which will make Virgin Media the only entertainment provider able to integrate the Spotify streaming music service into all of
its consumer offerings. As well as online and on mobile, we are working to build an exclusive TV app which will make a catalogue of over 13 million music tracks available to listen to through home cinema systems.