Murdoch jnr restores Sky divi
JAMES Murdoch, the controversial new chief executive of BSkyB, stunned investors today with news that the satellite broadcaster is to pay its first dividend for more than five years.
Analysts had expected Rupert Murdoch's son to name the date for the payout later this year but instead he chose to announce an interim dividend of 2.75p.
He said: 'These results show a business that continues to improve. We enter our second half with good momentum, robust financial health and a full programme of work.'
Sky added a further 193,000 subscribers in the Christmas quarter, taking its total to 7.2m. For the half-year to the end of December, its revenues rose by 17% to £1.77bn and pre-tax profits rebounded from £12m to £130m.
The dividend payout means the Murdoch dynasty will collect £18.9m through its 35% shareholding in BSkyB. The shares have powered ahead since last year's controversial succession debate.
Sky has continued to score on the woes of its rivals with the BBC in turmoil and ITV only beginning to emerge from the merger of Granada and Carlton. As Murdoch pointed out today, the combined market share of the traditional terrestrial channels fell below 50% for the first time in 2003.
Sky subscribers are also paying more for their programmes. Average annual spending on the service rose by 5% to £369 and that was before January's price increase.
BSkyB faces another showdown with some of its institutional shareholders over the pay-off of £4m or more that Martin Stewart is likely to receive when he stands down as finance director later this year. He applied for the chief executive job and is staying on until lucrative share options become exercisable.
The scale of his pay-off is dwarfed by that to former chief executive Tony Ball, who received £10.7m when he left, on condition he did not work for a competitor for at least two years.
Murdoch Junior said he was confident the group would hit its target of eight million subscribers by the end of 2005. More importantly, 55% of subscribers buy the top Sky World package. The addition of Sky channels on the Freeview system means that more than half the households in Britain now have access to one or more Sky channels.
News Corp's television programming guide provider Gemstar-TV Guide International has struck a licensing deal for its programme guides with cable operator Comcast which includes a $250m (£133.7m) one-off cash payment by Comcast.
With News Corp's new stake in DirecTV, Gemstar will now have the backing of the largest cable and satellite operators in the US. Gemstar chief executive Jeff Shell said the deal would ease concerns by other cable operators about doing business with Gemstar.
