Cable company profits up 10.6% in 2010

The CRTC last week released the aggregate financial results for cable, satellite distribution and multipoint distribution system (MDS) companies in Canada for 2010.

The regulator reports that Canadian cable companies earned profits before interest and taxes (PBIT) of $2.6 billion, up 10.6% from $2.3 billion in 2009 and up 121% from $1.2 billion five years earlier.

Contributing largely to the big jump in profits was strong revenue growth of 9.7% in 2010 after having increased 11.9% in 2009, and over 16% in 2008 and 2009. Cable company revenues have now more than double from under $5 billion just five years.

The number of Canadian households that obtained basic television service from a cable company rose by 2.2% to reach 8.3 million subscribers. The number of basic cable subscribers is by about 20% since 2005.

DTH and MDS

Results at Direct-to-Home (DTH) and multipoint distribution system (MDS) companies was nowhere near as strong as in Cable. Total revenues for satellite and multipoint distribution companies, while increasing from $2.2 billion in 2009 to $2.4 billion in 2010, were still less than the profits made by the Cable companies.

Total profits before interest and taxes at DTH and MDS companies were $163.9 million, a long way from the $32 million lost four years earlier but still a fraction of cable revenues.

The number of Canadian households that obtained basic television service from satellite or multipoint distribution companies increased by 3.7% in 2010 to reach 2.9 million.

Total Cable, DTH, and MDS

Overall revenues in the Canadian Broadcasting distribution industry grew by $1.1 billion from $11.4 billion in 2009 to $12.5 billion in 2010 while profits climbed to $2.6 billion.

Profits in the DTH and MDS averaged $57 per customer versus cable companies who earned an average of $310 per subscriber.

Read the complete Broadcast Distribution report on the CRTC website.

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