SIRI Intraday Updates for the Week of 11/03/08

DEIX to exit satellite radio business.......

http://biz.yahoo.com/prnews/081105/law084.html?.v=101

""While it is never an easy decision to exit any market, there are a number of factors that made exiting the satellite radio business the only logical choice for us. These factors include a dramatic drop in demand for aftermarket satellite radio, increasing warranty returns and decreasing margins that we and our customers have experienced throughout 2007 and 2008 on satellite radio products, and the large working capital commitment required for this relatively low margin business. Exiting this business will allow us to return 100% of our focus in 2009 to improving the experience we deliver to our customers and growing our highly profitable security and entertainment businesses."

Kevin Duffy, DEI Holdings' CFO, commented, "Exiting the satellite radio business will not only allow us to focus on our core business, but also increase our ability to pay down debt by recovering the $20 to $25 million of working capital we have committed to this business. Additionally, we are pleased with the terms of our wind-down agreement, as SIRIUS XM or their new partner will be purchasing substantially all of our remaining satellite radio inventory in the first quarter of 2009. They will also be taking full responsibility for all future product returns and warranty costs after January 31, 2009, regardless of when the product was sold."

Mr. Duffy continued, "Looking at the fourth quarter and into 2009, we anticipate that purchases of consumer electronics products will continue to decline significantly. As a result, we are taking every practical action to optimize our sales while preserving our margins. In addition, considering the realities of selling into this uncertain market, as well as our planned exit from the satellite radio receiver business next year, we plan to continue rightsizing our facilities and other overhead in all divisions of the company. Combined with the restructuring initiatives we have already implemented, we are confident that we are as well positioned as possible from an operational perspective to weather the current environment.""

Good or Bad for sirius :confused:

They will also be taking full responsibility for all future product returns and warranty costs after January 31, 2009, regardless of when the product was sold."

Quote:

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Originally Posted by APEXSPORTS

Good or Bad for sirius :confused:

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It could be good for SIRI depending on who the new supplier/suppliers is/are and what the terms are...

Maybe the new supplier/suppliers will be more aggressive in marketing/advertising their sat radios......

Quote:

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Originally Posted by J56D

They will also be taking full responsibility for all future product returns and warranty costs after January 31, 2009, regardless of when the product was sold."

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How can they say this without a deal with a new supplier in place?

No real affect other than it gives us some insight into a potential slowing in radio sales. It seems to me however that there will be plenty of other players that will pick up the slack if that's not happening already.

I got a clue about who it might be.. link.. http://www.streetinsider.com/Corpora...+/4072316.html

PIONEER I bet:thumbup:

http://www.wwj.com/Azentek-Demonstra...t-SEMA/3264385

Wednesday, 05 November 2008 4:31PM
Azentek Demonstrates In-Car Computing At SEMA

"Its long list of features includes Microsoft Windows Vista, Intel Core Duo processor, built-in Wi-Fi, voice recognition, AM/FM/XM/Sirius/HD Radio capability, Bluetooth, DVD player, CD rewriter, GPS navigation, Voice Over Internet Protocol capabilities, real-time engine diagnostics, and much more."

Quote:

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Originally Posted by APEXSPORTS

I got a clue about who it might be.. link.. http://www.streetinsider.com/Corpora...+/4072316.html

PIONEER I bet:thumbup:

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Pioneer has been a supplier to XM for a long time now.....I don't know if that relationship will extend to SIRI or not, but I bet they could make a better SIRIUS portable than Directed - that's for sure!

http://www.nctimes.com/articles/2008...f700621c3f.txt

Old-time radio finding new life
By RANDY DOTINGA - For the North County Times | Wednesday, November 5, 2008 10:07 AM PST ∞

"The golden age of radio drama is long gone, snuffed out by the rise of television. But if you missed it the first time, there are many ways

to catch up.

It turns out that classic radio drama is undergoing a revival of sorts. Fans can find long-forgotten shows on satellite radio.....

......The good news: Old-time radio shows are more available than ever. The satellite radio companies XM Radio and Sirius ---- which are merging ---- both offer channels devoted to old-time radio.

"Our sense of it is that the channels are surprisingly popular," said Jeremy Coleman, a senior vice president at Sirius/XM, and not just among those who were around decades ago.

"Kids, teenagers, kids in their 20s and 30s, they've heard of it and are being introduced to it," he said. "I have a sense that even as these shows get older and older, their appeal keeps refreshing."

Shows on Sirius's Radio Classics channel include "Fibber McGee and Molly," "Abbott and Costello," "Superman" and Jack Benny, among many others. Some of the shows heard on XM's Radio Classics channel are "Dragnet," "The Whistler" and "Gunsmoke.""

The normal little tease in AH, I suppose.....

Nov. 5, 2008

Market Close: $ 0.2601

After Hours Trade Reporting

After Hours
Last: $ .27
After Hours
High: $ .2834
After Hours
Volume: 813,382
After Hours
Low: $ .26

SIRI hit .32 in early pre-mkt trading.

See thread "SiriusXM releases projections

That's good to know......

ok, so who is going to analyze the report and tell us if its good, bad or pretty much expected from previous reports?

It's good. Or, let's say, not as bad as expected.

Well, SIRI is up 15%. Must be good.

UPDATE 1-Sirius XM warns auto troubles hurting growth

NEW YORK, Nov 6 (Reuters) - Sirius XM Radio Inc (SIRI) warned that the dramatic slowdown in car sales would hurt subscriber growth next year, as it issued an updated financial outlook in light of its negotiations with banks to cover debt coming due in 2009.

Sirius XM Radio, which is talking to financial institutions about ways to replace 2.5 percent convertible notes, has struggled since the company was formed last summer in the $3.3 billion merger of Sirius Satellite Radio and XM Satellite Radio.

The ailing auto industry is one of the major problems for Sirius XM, since new vehicle sales are a key avenue for subscriber growth. The company also has been hard hit by competition from other media, like iPods, and an economic slowdown that has consumers watching their spending. Shares of the company are stubbornly stuck below $1.

"Current economic conditions, particularly the dramatic and recent slowdown in auto sales, have negatively impacted subscriber growth for 2008 and 2009," the company said in its forecast.

It said it expects to end 2008 with 19.1 million subscribers, and end 2009 with 20.6 million subscribers.

But it said it "remains confident" in its revenue and adjusted EBITDA guidance for 2008 and 2009. That guidance did not change.

Sirius XM projected 2009 revenue of $2.7 billion, 2010 revenue of $3 billion, and 2011 revenue of $3.4 billion.




I think these are bad news, how can the stock be trading between 13% to 14% up from yesterday, is it because they did not change their guidance ? Do you'all think these news are already built into the .26 - .32 stock price range ?

SiriusOwner,

I believe it is positive because it shows that they will be able to re-finance the Feb. converts without issuing new converts or going bankrupt.

Mel forecast the 08' 19.5 million and the '09 21.5 million subscriber #'s in the 8K and at the presentation on 9/9/08 - just under two months ago. Mel just reiterated the 19.5 million '08 year end subscriber forecast about 3 weeks ago on Oct. 14th at the Dow Jones Newswires Media and Money Conference.

Now he lowers his '08 year end forecast 400 million to 19.1 million and lowers his 2009 year end forecast 900 million to 20.6 million?

Is this further under promising or did he not under promise enough the first time?

This article has a huge error or lie in it. It says that SIRI has $300 million in converts due in Feb. '09 - when in fact it's 250 million now after the two recent stock for debt exchanges. I am emailing the author now and I hope you do the same!

http://www.bloomberg.com/apps/news?p...4wI&refer=news

Sirius XM in Talks to Refinance Debt, Cuts Forecast (Update2)
By James Callan

Nov. 6 (Bloomberg) -- Sirius XM Radio Inc., the only U.S. pay-radio broadcaster, said it's in talks with banks to refinance debt due next year and lowered its forecast for subscriber growth after U.S. car sales plummeted.

The company is seeking to replace 2.5 percent convertible notes due next year, Sirius XM said in a statement today. It faces $1.1 billion in loan repayments in 2009, including $300 million in convertible bonds in February.

Sirius XM's subscriber growth relies on U.S. auto sales, which plunged for the 12th straight month in October. Shares of Sirius XM, led by Chief Executive Officer Mel Karmazin, have traded below $1 since Sept. 10 amid the economic contraction and the biggest slowdown in consumer spending in 28 years.

``Mel Karmazin is making the best of a bad situation that seems to have gotten worse because of economic conditions which are beyond his control,'' Fred Moran, a Boca Raton, Florida-based analyst with Stanford Financial Group, said in an interview. ``Refinancing this debt will be an uphill battle.'' Moran recommends holding on to the shares and doesn't own any.

Sirius XM, home to Howard Stern and the National Football League, rose 2 cents to 28 cents at 10:44 a.m. in Nasdaq Stock Market trading. The shares had plunged 91 percent this year before today.

Chief Executive Officer Mel Karmazin's $2.76 billion all- stock purchase of XM Satellite Radio Holdings Inc. in July created a company with more than 18.5 million subscribers. Sirius XM today predicted 19.1 million subscribers by year-end, less than its earlier forecast for 19.5 million, and lowered the 2009 projection to 20.6 million from 21.5 million.

`Dramatic'

``Current economic conditions, particularly the dramatic and recent slowdown in auto sales, have negatively impacted subscriber growth for 2008 and 2009,'' Sirius XM said in the statement. The company reiterated its forecast for adjusted earnings of $300 million in 2009 on revenue of $2.7 billion.

U.S. auto sales plummeted 32 percent in October in what General Motors Corp. called the worst month for the industry since 1945 after accounting for population growth. Reduced access to loans and a weaker economy kept people away from car dealerships. Sirius XM has agreements with automakers to preinstall its satellite radios in vehicles.

`Hostile Market'

``The threat of refinancing debt in hostile market conditions is the biggest issue weighing on the stock,'' James Goss, an analyst with Barrington Research in Chicago, said in an interview. ``The biggest challenge is the debt issue and they seem confident, but it's not entirely under their control.'' Goss rates the shares ``outperform'' and doesn't own any.

Credit terms have loosened recently. The benchmark London interbank offered rate, what banks charge each other for three- month loans in dollars, dropped today to 2.39 percent, the lowest level in four years, after reaching a 12-month high of 5.15 on Dec. 5.

Last month, Sirius said it may issue stock to repay the debt and asked shareholders to approve a reverse split. That would help Sirius keep its Nasdaq listing by pushing the price back over $1. That was a change from August, when Karmazin said the company had no plans for a reverse split.

The Federal Communications Commission voted 3-2 on July 25 to approve the merger of the XM and Sirius. Concerned that traditional radio operators might get a judge to block the combination, Sirius struck an ``ugly'' debt deal to quickly complete the purchase of Washington-based XM, Karmazin said in August.

To contact the reporter on this story: James Callan in New York at jcallan2@bloomberg.net

Last Updated: November 6, 2008 11:16 EST