Cox Reports Steep Drop in Profit

Jul 29, 2004  •  Post A Comment

Cable operator Cox Communications on Thursday reported a 47 percent plunge in second-quarter profit even as the company booked higher revenue due to the increased popularity of advanced services.

The Atlanta-based cable operator with 6.3 million subscribers reported a profit of $62.7 million, or 10 cents a share, vs. $117.7 million, or 19 cents a share, a year ago. The 2003 numbers included huge gains on investments, while 2004 reflected a number of pre-tax losses, including one worth $5 million for the sale of a number of small non-clustered systems in Oklahoma, Kansas, Texas and Arkansas.

Revenue climbed 12 percent to $1.6 billion, as the company reported robust growth in high-speed data and telephony services.

On the high-speed data side, Cox reported 34 percent year-over-year customer growth to 2.2 million, with 97,517 additions in the quarter. The telephone service surged 35 percent year-over-year to 1.1 million customers, with 66,265 signing up for the service in the quarter.

Meanwhile, the company’s core basic cable subscriptions were largely flat during what is traditionally a weak quarter because of the seasonal effects of college students moving out of housing and snowbirds heading north for the summer months. However, like other cable operators, Cox appears to have been at least mildly hurt by increased competition from satellite operators, which have stepped up individually and with the regional Bell operating companies to grab market share from the cable operators.

Digital cable subscriptions hit 2.3 million in the quarter, with Cox adding more than 60,000 customers in the three-month period.