DirecTV Reports Loss as Subs Rise

Aug 5, 2004  •  Post A Comment

DirecTV Group reported Thursday a quarterly loss of $13 million, compared with a year-earlier profit of $22 million. Revenue surged 21 percent to $2.6 billion as higher costs for subscriber-acquisition and customer-retention efforts offset revenues from a 944,000-customer gain in the quarter. DirecTV ended the quarter with more than 13 million subscribers. The company will get another 1 million customers following the completion of its $875 million all-cash acquisition of Pegasus Satellite Television, the satellite arm of Pegasus Communications. The acquisition, announced last week, lays to rest a years-long legal battle between the two companies.

Separately, DirecTV’s pending $3.55 billion sale of its PanAmSat Corp. unit to a team of buyers led by Kohlberg, Kravis, Roberts & Co. could be in jeopardy because of the failure of the propulsion system in one of its satellites. If Galaxy 10R cannot be restarted, KKR, which along with Providence Equity Partners and Carlyle Group agreed in April to buy PanAmSat, could terminate the sale.