SIRIUS XM Q1 Earnings In Line, Revs Beat - Analyst Blog

SIRIUS XM Holdings Inc. SIRI reported better-than-expected financial results for the first quarter of 2014. The company generated record high adjusted EBITDA as a considerable number of subscribers stayed on after an initial promotional period.

Quarterly GAAP net income came in at $94.1 million or 2 cents per share compared with $123.4 million or 2 cents per share in the prior-year quarter. First-quarter net earnings per share of 2 cents were exactly in line with the Zacks Consensus Estimate.

Quarterly total revenue of $997.7 million exhibits annualized growth of 11.2% and also outpaced the Zacks Consensus Estimate of $991 million.

Quarterly total operating expenses totaled $750.3 million compared with $650.5 million in the year-ago quarter. Operating income, in the reported quarter, was around $247.4 million as against $246.9 million in the prior-year quarter. SIRIUS XM posted record first-quarter adjusted EBITDA growth of 27.8%, bringing the figure to $334.8 million.

In the first quarter of 2014, SIRIUS XM generated $251.4 million of cash from operations compared with $167.9 million in the year-ago quarter. Quarterly free cash flow was $222.8 million against $142.5 million in the year-ago quarter.

At quarter end of the reported quarter, SIRIUS XM had nearly $121.2 million of cash and cash equivalents and $3,440.7 million of outstanding debt compared with $134.8 million and $3,093.8 million, respectively, at the end of 2013. At the end of the reported quarter, the debt-to-capitalization ratio stood at 0.52 against 0.53 at the end of 2013.

Segment Results

Quarterly Subscriber revenues were $851.4 million, up 8.7% year over year. Advertising revenues stood at $22.2 million, up 9.9% year over year. Equipment revenues were $24 million, up 32.1% year over year. Other revenues were $100.1 million, up 32.2% year over year.

Subscriber Statistics

During the first quarter of 2014, SIRIUS XM added 266,799 (down 41.1% year over year) net subscribers, which reached the company's total subscriber base to 25,826,109 as of Mar 31, 2013, up 6.1% year over year. Payment category wise, Self-Pay subscribers totaled 21,255,297 (up 7% year over year) while Paid Promotional subscribers were 4,570,812 (up 2.1% year over year).

Important Operating Metrics

In the reported quarter, average revenue per user came in at $12.18 compared with $12.05 in the year-ago quarter. Average self-pay monthly churn rate was 1.9% against 2% in the prior-year quarter. New Vehicle Customer Conversion rate came in at 42% versus 44% in the year-earlier quarter. Subscriber acquisition cost stood at $35 compared with $47 in the year-ago quarter.

Financial Outlook

Management expects full-year 2014 revenues to cross the $4 billion mark. Free cash flow will likely be $1.1 billion. The company estimates an addition of 1.25 million net new subscribers in 2014. Adjusted EBITDA is projected to be around $1.38 billion.

Other Stocks to Consider

SIRIUS XM, the leading broadcast radio service provider in the U.S., currently has a Zacks Rank #3 (Hold). Other better-ranked TV/Radio broadcasters that warrant a look include Phoenix New Media Ltd. FENG, Entravision Communications Corp. EVC and Saga Communications Inc. SGA. All these stocks carry a Zacks Rank #2 (Buy).


 
ENTRAVISION COM EVC: Free Stock Analysis Report
 
PHOENIX NEW MED FENG: Free Stock Analysis Report
 
SAGA COMMS-CL A SGA: Free Stock Analysis Report
 
SIRIUS XM HLDGS SIRI: Free Stock Analysis Report
 
To read this article on Zacks.com click here.
Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!