Sky News Owner Unveils 18% Profit Increase

Sky plc, the home and mobile entertainment group which owns Sky News, has announced an 18% increase in full-year operating profit and said it had recorded the highest growth in its UK customer base for more than a decade.

Announcing annual results on Wednesday, the UK’s largest pay-television company said operating profit in the year to 30 June was £1.4bn, while profit before tax was up by 6% on an adjusted basis to just under £1.2bn.

The results are the first set of full-year figures since Sky completed the takeover of its sister companies in Germany and Italy, which took the number of countries in which it operates to five.

Its performance in its home markets of the UK and Ireland is expected to be well-received in the City, with organic customer growth of 506,000, taking the total number of customers in those countries to more than 12 million for the first time.

It also grew the number of products across its portfolio, which includes broadband and fixed-line telephony alongside pay-TV services.

Significantly, the level of customer churn in the UK and Ireland fell to its lowest for 11 years, which Sky said reflected its investment in “connected services and quality content”.

Announcing a 3% rise in its dividend, Jeremy Darroch, Sky’s chief executive, said: "The past 12 months have been an outstanding period of growth for Sky.

"We’ve successfully completed a deal that has transformed the size and scale of opportunity for the business whilst delivering an excellent financial and operational performance as more customers chose Sky and took more of our products.

"It’s clear that the steps we have taken to broaden out our business are paying off. By distributing our content over multiple platforms and launching new products and services, we are now able to offer something for every household."

Investors have been looking for a strong performance from Sky following its decision earlier this year to commit more than £4bn to retain the lion’s share of live Premier League rights for the three seasons from 2016-17.

Mr Darroch also pointed to dramas such as Fortitude and 1992 as evidence of Sky’s commitment to original content, and said the company saw "an expanded opportunity for growth by serving the market broadly with multiple products and services".

It has struck a partnership with Telefonica to offer mobile phone services under the Sky brand, with the launch expected next year.

Sky also said it was making “good progress towards establishing a roadmap for a single set-top box across the group” and added that it was on track to hit targets from the integration of Sky Italia and Sky Deutschland.

Shares in Sky, which closed on Tuesday at 1124p, are up more than 24% over the last year.