Sky TV takes potshot at Spark
Firm gave no financial forecast at AGM
Sky offered no 2019 guidance at its annual meeting in Auckland yesterday. At its full-year result on August 24, the company said it would deliver its forecast at the AGM. Chief financial officer Jason Hollingworth told the Herald “we are not issuing guidance today as we are less than three months in”.
Neither did the company name a replacement for long-serving chief executive John Fellet, who in March announced his intention to depart. Chairman Peter Macourt said he hopes to name a successor “in the near future”.
There was no further update on subscribers numbers, and the company is refusing to address an NBC Universal buyout rumour. A source has told the Herald that delays with major announcements are an indication of a pending deal.
But shareholders did get to hear Spark getting the bash. Macourt used his address to his to take shots at the telco.
“One of the characteristics of the New Zealand market is that a significant number of New Zealanders don’t yet have access to streaming-capable internet, and it may be some years before they do,” say Macourt’s address notes, which contain several back-hand digs at Spark.
Spark won rights to the Rugby World Cup 2019 and English Premier League football for three years from 2019, and plans to stream video for both over the internet, albeit with free-to-air partner TVNZ on hand as a backup if things go south.
“Our sport partners know they can rely on Sky to deliver their content to all of their NZ fans, in ways that work for each individual,” Macourt adds. “They also know that internet delivery of live sport is notoriously difficult. Nowhere in the world is it fully succeeding yet. The recent failure in Australia to deliver the Football World Cup online is just one example.”
Spark has yet to detail how it plans to stream sport, but says it will be on a new platform, separate to Lightbox.
On August 24, the broadcaster reported a $240.7 million loss for the June year against a profit of $116.3m in the previous year.
But allowing for a $360m non-cash accounting adjustment, Sky’s underlying net profit actually increased by 2.6 per cent to $119.3m as subscriber losses slowed and expenses were kept in check. The silver-linings should not be over-stated, however. The full-year dividend was halved to 15 cents a share.
Average revenue per user (arpu) declined for the first time, and while defections slowed in the second half, thanks to price-cutting, the subscriber decline of the past couple of years continued.
Subscriber numbers for the year came to 767,727 — down from 824,782 in the previous year and 11,049 fewer than in December.
Sky refused to breakout numbers for its Neon and Fanpass streaming services.
At yesterday’s AGM, Fellet reiterated Sky’s plan to release a small, internet-only box at some point in the next 12 months, similar in size to Apple TV. As previously flagged, it will support apps from Netflix and other third parties.
He also reiterated plans for an apponly service at some point.
Macourt, who has been on the board since 2002, said the company would begin succession planning for a new chairman once a new CEO was appointed. He indicated he had previously planned to resign after the Sky TV-Vodafone merger, which was ultimately blocked by the Commerce Commission.