Chart today looked, nice, calm and trending upwards..quite pleased...maybe its just warming the tires!!
SIRIUS XM SATELLITE RADIO FORUM
Chart today looked, nice, calm and trending upwards..quite pleased...maybe its just warming the tires!!
since cramer tanked the stock when the merger deal was approved, he has been silent. i am wondering if on thursday or friday he say something. sirians watch his show and he wants ratings.
Sirius XM Needs to Show Cost Cuts
05/04/09 - 08:00 PM EDT
SIRI , GM , F , CMCSA
Robert Holmes
Sirius XM (SIRI Quote) will report its first-quarter results before the start of trading Thursday, and while analysts will be watching subscriber numbers for signs of weakness, cost-cutting may be a better indicator of how the satellite radio giant is dealing with the harsh economic environment.
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The outlook for Sirius XM has improved dramatically after Liberty Media's $530 million loan infusion helped diffuse worries the company would be forced into bankruptcy. Shares of Sirius XM have rallied more than 600% to 39 cents from the 52-week low of 5 cents set in early February at the height of the uncertainty.
With concerns over Sirius XM's debt on the back burner, investors and analysts can resume weighting the satellite company's future based on its key metrics -- adjusted earnings before income, taxes, depreciation and amortization, subscriber count, churn and conversion rates, subscriber acquisition costs, and average revenue per subscriber.
On average, analysts expect Sirius XM to post a first-quarter loss of 2 cents a share on revenue of $647.4 million, according to a Thomson Reuters poll of three analysts. That compares to a loss of 7 cents a share in the year-ago quarter, which was before the merger between Sirius and XM, and 8 cents a share in the fourth quarter of 2008.
Sirius XM and its CEO Mel Karmazin have placed a greater emphasis on the importance of adjusted earnings before income, taxes, depreciation and amortization, or EBITDA. Karmazin has asserted that the company will see positive adjusted EBITDA of $300 million in 2009, which would be a significant win for the merged company. Just two years ago, Sirius had an adjusted loss of $565.5 million, which shrank to an adjusted loss of $136.3 million in 2008.
The fourth quarter of 2008 showed strength on the adjusted EBITDA front, as Sirius XM reported adjusted income of $31.8 million, compared with a year-ago loss of $224.1 million. If the company is able to build on that number in the first quarter, Karmazin will likely trumpet the improvement toward his $300 million goal.
Focus on Subscriber Growth
Subscriber numbers will also be very important to investors. In November, Sirius XM offered projections for the next five years, saying it expects to grow its subscriber count to 28.4 million by the end of 2013. The company ended 2008 with 19 million subscribers and said it should finish 2009 with 20.6 million subscribers.
However, when the company reported its fourth-quarter numbers in March, Sirius XM said it would not make any subscriber projections given the economic uncertainties, which raised a red flag for some investors who feared the worst.
The Good News: Lower Costs
Perhaps the bright spot in Sirius XM's first-quarter report will come from cost reductions. In tough times like these, companies do whatever is necessary to reduce costs. For Sirius XM, which merged only months ago, synergies are expected to help cut many of those costs.
reports Thursday, lower subscriber acquisition costs should garner attention. Subscriber acquisition costs declined nearly 12% in 2008. A 5% drop in gross subscriber additions helped improve that figure.
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Looking at the fourth quarter, subscriber acquisition costs per gross subscriber improved to $70 from $83 in the year-ago quarter. If that number improves in the first quarter, much of that move can be attributed to lower gross subscriber additions, but it may still help Sirius XM's bottom line.
Other costs declined in the fourth quarter. Programming and content costs decreased by 4%, revenue share and royalties expense fell by 25%, sales and marketing costs declined 34%, general and administrative costs decreased 20%, and engineering, design and development costs were 27% lower.
On the other hand, customer service and billing costs increased 3% compared to the same quarter a year ago. However, it's the programming and content costs that analysts and investors will closely watch for a change.
"Sirius XM has been unsuccessful in renegotiating some larger content contracts," Moran said. "For example, Major League Baseball reportedly refused to change its contract, which costs approximately $60 million per year for the broadcasting rights. Other large content contracts include Howard Stern, Oprah Winfrey, and the NFL. We believe Sirius XM must devise a strategy to lower content costs to remain viable."
Interesting.. thanks for the link. Not sure how i missed this before now.Originally Posted by SiriusBuzz
edit: lame the storm is not supported.
Last edited by Miller; 05-05-2009 at 12:20 AM.
hey miller it is a stripped down version, at least te one i can get, its not the full service, i cant get howard so i could care less :O
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John. I'm proud of you buddy. What an accomplishment.
socalrunningfool, first of all if you were being sarcastic, then you should be aware that it is something to be proud of. It shows I dont just follow the herd, I question what people say and I am not afraid to be banned or what ever for it. I am who I am and and that is what you get. That means you wont read from me a agreement of someone just because they have some control over a site or whatever else. Just take a look at "Satwaves" and you will see what I am talking about.
Next as for me putting that comment up it was to set the record straight on the rumor of people being banned and how false it was. I would not expect you to get that so I said it again in more plan english for you. Also coming from me it is more believable considering the history Charles and I have had. From that people can see I dont agree with Charles like many seem to do just because he runs the site.
I think its fine if this goes back to a weekly thread....
hee yahh, crack the whip go horsey go....
open with heavy volume and positive momentum... .419
I am a nitwit but is 400,000 subscriber loss bad news?
a loss is expected, bad news would be if they didnt seem on track to hit 300 million ebitda for the year.
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