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http://blogs.wsj.com/deals/2008/10/1.../?mod=yahoo_hs
October 14, 2008, 11:38 am
The Future of Sirius XM: Playboy and the Pope
Posted by Heidi N. Moore
You can understand if investors in Sirius XM Radio are in despair. After all the company’s shares look more like a penny stock than the shares of the second-largest U.S. audio company–created by the combination this year of Sirius Satellite Radio and XM Satellite Radio Holdings. Shares were trading at 54 cents in midmorning trading–and that was a 6% boost from Monday’s close.
Associated Press
For CEO Mel Karmazin (left), that means it is time to sell, sell, sell–not the shares, but the company’s prospects. At the Dow Jones Media and Money conference this morning, Karmazin talked up Sirius XM’s future as a content company.
And what kind of content? In a classic Karmazinian juxtaposition, the CEO crowed, “We have 24-hour-a-day Playboy Radio, we have a 24-hour-7-day-a-week Catholic Diocese channel…” Interesting synergies that.
The rest of Karmazin’s time on stage was spent on the hard sell. With analysts questioning Sirius’s ability to meet revenue forecasts and the company having agreed to offer a la carte pricing as a condition of the merger, Karmazin made his case for the full-subscription model (currently $16.99 a month at Sirius XM, with a la cart options starting at $6.99 a month), saying a full subscription was a way of guaranteeing options. “We consider ourselves a content company,” he said, reminding the attendees of the power of Sirius-only broadcasters like Howard Stern. “People can listen to commercials on radio, or pay us 43 cents a day.”
Karmazin acknowledged analysts’ skepticism about Sirius XM obliquely, by mentioning, near the end of his interview, how the company needed to increase its free cash flow.
But he saved much of his ire for competitors such as HD radio and Clear Channel Communications’ mammoth terrestrial radio network. In Washington, there has been talk of requiring car makers to install HD radio gear as an alternative to Sirius XM. Karmazin scoffed at the idea, which he said would drive up car prices.
Karmazin’s sales job was lost on no one. Wrapping up the interview, his interviewer concluded, “Well. You’ve made your pitch.”
That pitch might have been better served for the credit markets. That is because the company has $1.1 billion in debt to be refinanced next year, and Merrill Lynch analyst Jessica Reif Cohen wrote on Sept. 29 that the real fear around Sirius is that it won’t get the three debt deals done. “Investors are currently pricing substantial risk that SIRI will be unable to refinance ‘09 maturities, potentially forcing a restructuring,” she wrote.
“I wish the debt market wasn’t what it was,” Karmazin said today. “It’s very challenging, but we’ve been talking to our debt holders and I’m confident we’ll be able to work something out.”
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http://www.reuters.com/article/marke...0081014?rpc=44
UPDATE 1-Sirius CEO 'confident' about debt refinancing
Tue Oct 14, 2008 11:11am ED
NEW YORK, Oct 14 (Reuters) - Sirius XM Radio (SIRI.O: Quote, Profile, Research, Stock Buzz) Chief Executive Mel Karmazin is confident that the satellite radio company will be able to refinance its debt in spite of the troubled credit markets, he said on Tuesday.
"I believe that we will be able to refinance it," he said at the Dow Jones Media and Money conference in New York.
Sirius XM faces some $1.1 billion in debt in 2009. Of that, about $300 million comes due in February.
Karmazin had previously said the company was in talks to refinance that debt.
"I am confident that we will get that done," he said on Tuesday.
The wave of troubles in the finance markets and concerns about the looming debt payments have weighed on Sirius shares, which for the past few weeks have traded below $1.
The stock was down 1.9 percent at about 50 cents in morning Nasdaq trade. (Reporting by Franklin Paul; Editing by Lisa Von Ahn)
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http://news.cnet.com/8301-1023_3-100...=2547-1_3-0-20
October 14, 2008 8:22 AM PDT
Sirius XM chief: Yes, we will be profitable
Posted by Caroline McCarthy Post a comment
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NEW YORK--He made it past the Federal Communications Commission. But Sirius XM Radio CEO Mel Karmazin now has to deal with Wall Street.
In his keynote interview Tuesday at the Media & Money Conference, a joint production of Dow Jones and Nielsen, Karmazin wasn't in humility mode. "We're probably one of the top 25 media companies today," he said of the newly merged Sirius XM, which brought together the world's only two satellite radio companies. "I think it's very clear that we will be the most successful company in the audio entertainment industry. I know certainly, as ranked by revenue, we'll be there soon. Now we just need to grow our free cash flow and demonstrate that."
As so many have argued in recent weeks, Karmazin's mantra was that Wall Street is misguided, myopic even. "You need to make money, and in this particular environment, with Wall Street being what it is today, I think the companies that get rewarded today are companies that have an awful lot of cash flow, that make a great balance sheet. And that's not us today."
Sirius XM is in a tight spot. The merger was long and costly, both companies have shelled out extraordinary amounts of money to secure personalities like Howard Stern (who cost $500 million alone), and the credit crunch has dealt a blow to the most lucrative base of new satellite radio subscribers--car buyers. Sirius XM also has to refinance about $1 billion in debt, something else that won't be easy considering the volatile market.
Karmazin, a veteran of Viacom and CBS (which publishes CNET News), joined Sirius pre-merger in 2004, and acknowledged that he was brought onboard to accomplish a very difficult task of making the company profitable. "Before Sirius got its first dollar of revenue, which was in 2002, we had billions of dollars invested in the company," he said, explaining that the company had to launch three satellites before a single subscriber could sign up. That was a billion-dollar project.
"The day I joined the company, we had revenues of $67 million, and with revenues of $67 million the company had announced five months before that it had signed Howard Stern for $500 million," he said.
Today, Sirius XM has 19.5 million subscribers, which Karmazin said makes it the second-biggest subscriber base in the cable-satellite space behind Comcast, and is slated to keep growing. Sirius cut back its net losses last quarter, its final quarter before the merger. But the downturn in car sales is making Wall Street and the rest of the world less confident about Sirius' growth projections.
Karmazin said that if the auto market does poorly, there will still be millions of new satellite radio subscribers. "(Let's say) in 2009 there were only 12 million cars sold. That could happen, but no one has forecast that number as low," he speculated. "Of the 12 million, 6 million will leave the assembly line with satellite radio installed. So that would get us 6 million gross adds, and then there's a conversion rate. About 50 percent of those people choose to keep satellite radio...That would mean we're going to add about 3 million new subscribers just from that OEM (original equipment manufacturer) platform.
It was an optimistic pitch to the suit-clad audience, especially considering the widespread belief that satellite radio has been an overpriced, failed experiment.
But the good-ish news? The coming advertising downturn won't shoot down satellite radio. Karmazin said that between 94 percent and 96 percent of Sirius XM's revenue comes from monthly subscription fees, not advertising.
A typo was corrected: Sirius first pulled in revenue in 2002, not 2022.
Caroline McCarthy, a CNET News staff writer, is a downtown Manhattanite happily addicted to social-media tools and restaurant blogs. Her pre-CNET resume includes interning at an IT security firm and brewing cappuccinos. E-mail Caroline.
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Market is red....way red now.
SIRI just dipped to .49 - I am hoping .50 holds and there is a bounce into the close.
I thought the SIRI news flow was pretty positive today...
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http://www.fmqb.com/Article.asp?id=934519
Karmazin: Sirius XM Will Be Profitable
October 14, 2008
Sirius XM Radio CEO Mel Karmazin was the keynote speaker at this morning's Media & Money Conference, telling attendees that the merged satcaster has a bright future ahead. "We're probably one of the top 25 media companies today," Karmazin said, according to CNet. "I think it's very clear that we will be the most successful company in the audio entertainment industry. I know certainly, as ranked by revenue, we'll be there soon. Now we just need to grow our free cash flow and demonstrate that."
As for Sirius XM's chances in the current economic climate, Karmazin noted, "You need to make money, and in this particular environment, with Wall Street being what it is today, I think the companies that get rewarded today are companies that have an awful lot of cash flow, that make a great balance sheet. And that's not us today."
He said that the satcaster's 19.5 million subscribers make it the second-largest subscription-based media company, after Comcast. The satcaster CEO also boasted that Sirius XM is also the second "most successful company in the audio entertainment industry," after Clear Channel.
Karmazin was also optimistic about the future of satellite radio in automobiles. He hypothesized that "[what if] in 2009 there were only 12 million cars sold. That could happen, but no one has forecast that number as low. Of the 12 million, 6 million will leave the assembly line with satellite radio installed. So that would get us 6 million gross adds, and then there's a conversion rate. About 50 percent of those people choose to keep satellite radio...That would mean we're going to add about 3 million new subscribers just from that OEM platform."
As for the proposed legislation forcing the addition of HD Radio in cars alongside satellite, Karmazin said, "The consumer ought to decide. The government shouldn’t be requiring HD Radio just because the content is not compelling enough on its own to get people to buy these radios."
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http://www.1888pressrelease.com/seoc...-pr-77368.html
SeoChampion.com purchases several thousand shares of Sirius Satellite Radio INC
(1888PressRelease) October 12, 2008 - Michael Rotkin is a long time stock investor and Internet Guru, which has been sidelined till today after his purchase. He was trading stocks back at the age of 18, 13 years ago.
He was one of the first members of raging bull and other stock social networks of their time.
Now Michael's main business is building large online companies that are turn key and make 20%100%+ returns per month for buying and selling internet traffic through google.com, yahoo.com and msn.com
I bought Sirius today at 45.3 cents a share, which is a steal. The company has the rights to satellites to provide radio and other things I believe Sirius will with my knowledge of the future" says Michael Rotkin
To get a copy of the how to double your money monthly for " Online Businesses" and get started, paypal $500 to mrotkin ( @ ) aol dot com and get your copy, that is not published anywhere dot
Michael Rotkin predicts that Google or Yahoo or a like company will want to take over Sirius and its members or work a advertising deal, states Michael Rotkin a non Stock professional, only " Internet Marketing Professional" .
This information is directly from a opinion of Michael Rotkin CEO of Seochampion.com and domain assets
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SIRI is now trading around the low of the day near .49 with 5 minutes left...
Please close green!
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SIRI closed down .021 @ .489 - those bastards were at it again, wacking the stock at the close. Can SIRI ever hold onto it's gains? Market was down slightly considering the gain yesterday....
One of these days, Mel will really announce something.....debt financing, cash on hand, exploding "best of" subs?
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next year will be the year for Sirius
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It looks like SIRI closed at .48 - they slid in one more trade at the very end after my streamer stopped......
SIRI down .03 today.........closing at .48 - there is always tomorrow. Mel needs to say, "We got the money!" and then the stock will rocket...
