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  1. J56D is offline
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    Joined: Jul 2008 Posts: 173
    11-10-2008, 07:13 PM #1

    Was this done on purpose? Bloomberg

    Sirius XM Loss Widens on Slowing Subscription Growth, Writedown

    By James Callan

    Nov. 10 (Bloomberg) -- Sirius XM Radio Inc., the only U.S. pay-radio broadcaster, reported a wider third-quarter loss as plummeting automobile sales slowed subscription growth and the company had a writedown related to the drop in its share price.

    The net loss of $4.88 billion, or $1.93 a share, compared with a loss of $120.1 million, or 8 cents, a year earlier, the New York-based company said today in a statement on its Web site. Revenue more than doubled to $488.4 million, missing the $590.9 million average of eight analysts' estimates complied by Bloomberg.

    Sirius XM, home to Howard Stern and the National Football League, added 344,081 net subscribers in the quarter for a total of 18.9 million amid the biggest slowdown in consumer spending in 28 years. 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.

    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. Last week, Sirius XM predicted 19.1 million users by year-end, less than an earlier forecast for 19.5 million, and lowered next year's projection by almost a million, citing the slumping car business.

    Sirius rose 1 cent to 27 cents at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have tumbled 91 percent this year. Sirius recorded a goodwill impairment of $4.75 billion, ``principally related to the decline in the company's share price since the date of the merger agreement in February 2007,'' according to the statement.

    Loan Obligations

    Sirius XM, facing about $1 billion in loan repayments in 2009 including $250 million in convertible bonds in February, is in talks with banks to refinance. The stock has traded below $1 since Sept. 10 as investors grow concerned that Karmazin, 65, won't be able to manage the debt or meet growth projections.

    ``Given the current credit environment any refinancing is uncertain,'' Fred Moran, a Boca Raton, Florida-based analyst with Stanford Financial Group, said in a note to investors last month. He advises holding the shares.

    Karmazin said in August that Sirius XM could weather the decline in auto sales because carmakers were putting his radios in more vehicles.

    Churn, the rate at which customers canceled service, widened to 1.7 percent from 1.6 percent a year earlier, Sirius XM said.

    Last month, Sirius XM announced it was issuing more stock to pay down $50 million of its $300 million in February 2009 notes and asked shareholders to approve a reverse stock split. In August, Karmazin had said the company had no plans for a split.

    The combination of Sirius and XM will generate savings of $425 million next year, the company said in September. Sirius forecasts adjusted earnings of $300 million in 2009 and said revenue should reach $2.4 billion in 2008 and $2.7 billion next year.

    To contact the reporter on this story: James Callan in New York at
    Last Updated: November 10, 2008 17:07 EST

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  2. Demian is offline
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    Joined: Oct 2008 Posts: 2,320
    11-10-2008, 07:21 PM #2
    That's the same reporter who incorrectly reported an exaggerated Feb. debt amount too. I emailed him about the error in his last article and he eventually fixed it.........

  3. tim wallick is offline
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    Joined: Jul 2008 Posts: 204
    11-10-2008, 07:56 PM #3
    the report does say they took a charge 4.8 billion do to the mark to market requirments for reporting.