TORONTO – Despite “steady” growth in revenue and subscribers, Canadian Satellite Radio Holdings, parent company of XM Canada, reported an adjusted operating loss of $3.3 million for the third quarter of 2010, slightly lower than in the third quarter of 2009.
For the three months ended May 31, 2010, net loss before foreign exchange gains was $16.1 million, compared to $15.1 million in the same period last year (excluding non-comparable items of $22.8 million as a result of a debt buyback). Pre-marketing adjusted operating profit was $1.2 million for the quarter, down from $2.4 million for the same period of 2009, marking the eighth consecutive quarter in which XM Canada has generated pre-marketing adjusted operating profit.
Revenue grew 5% year-over-year to $14.1 million from $13.5 million, which was offset by an increase in the cost of revenue and general and administrative expenses for the period, the company said. Self-paying subscribers were up 14% to 414,500 from 363,400 in 2009. (XM Canada recognizes only those customers that are paying for its service as self-paying subscribers).
"Since our launch almost five years ago, we have followed a deliberate and disciplined strategy to build a robust business with strong products and partnerships," said president and CEO Michael Moskowitz, in a statement. "We are on track with that strategy and now are in a position to fully leverage market opportunities that will expand our audience reach and revenue."
Average monthly subscription revenue per subscriber (ARPU) dipped to $11.18 from $11.97 in the third quarter of 2009. The company said that the decline was due to a "significant" increase in automotive self-paying subscribers, which have a lower ARPU; promotional discounts offered to consumers to encourage adoption of multi-year plans and increase retention; and the implementation of a revenue reserve.
