SIRIUS XM Holdings Inc.
) 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
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.
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.
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
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.
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
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.
Entravision Communications Corp.
Saga Communications Inc.
). All these stocks carry a Zacks Rank #2 (Buy).
ENTRAVISION COM (EVC): Free Stock Analysis
PHOENIX NEW MED (FENG): Free Stock Analysis
SAGA COMMS-CL A (SGA): Free Stock Analysis
SIRIUS XM HLDGS (SIRI): Free Stock Analysis
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