SOURCE: British Sky Broadcasting Group PLC

January 31, 2007 02:02 ET

British Sky Broadcasting Group PLC announces Interim Results

Middlesex, UK -- (MARKET WIRE) -- January 31, 2007 --

            Results for the six months ended 31 December 2006

   BSkyB announces record sales and 20% increase in interim dividend;
                         on track for our targets
Operational Highlights
* New customer additions of 432,000 in the second quarter, the highest in 
  six years

* Net customer growth in the second quarter of 183,000 to 8.441 million

* Record growth in Sky+ boxes to 2.13 million, in 1.97 million households

* HD subscribers almost doubled in the second quarter to 184,000, 
  establishing Sky's leadership in HD

* Good progress on Sky Broadband with gross bookings of 343,000 and 
  259,000 activated customers by 28 January 2007(1)

* Broadband network roll-out ahead of plan, 771 exchanges unbundled, 50% 
  of the U.K.(1)

Financial Highlights

* Revenue increased by 10% to GBP2,220 million, including GBP22 million 
  from Sky Broadband and GBP77 million from Easynet Enterprise

* Adjusted gross margin of 63% up from 60% in the comparable period(2)

* EBITDA of GBP486 million including losses of GBP66 million in Sky 
  Broadband and Easynet Enterprise and a net exceptional gain of 
  GBP59 million

* Operating profit of GBP395 million including losses of GBP84 million in 
  Sky Broadband and Easynet Enterprise and a net exceptional gain of 
  GBP59 million

* Basic EPS of 14.0p (2006: 14.9p) and adjusted EPS of 11.3p 
  (2006: 14.7p)(3)

* Interim dividend increased by 20% to 6.6 pence per share

James Murdoch, Chief Executive said:

"In the last six months we have achieved a number of important milestones in building our business for the future. Sales of new Sky boxes were the highest for six years, Sky+ broke through the two million barrier and Sky HD almost doubled in size after a strong Christmas sales period. With over one in four of our customers now taking an additional service from Sky, more people are choosing more of our products than ever before.

"At the end of our first full quarter as a broadband provider, benefits are starting to flow through the business. Sky Broadband is attracting new and existing customers with more than two-thirds opting for our faster, paid-for products. The rollout of our all-IP broadband network is progressing ahead of schedule. As a result, we now reach more households than the entire U.K. cable network with our "See, Speak, Surf" combination of TV, telephony and broadband products.

"We are committed to making a difference with energy efficiency and climate change. Sky was recognised recently as a National Energy Efficiency Champion and I want to thank all our staff for making this possible.

"In 2007, we will continue to drive towards our goal of being the leader in entertainment and communications in the U.K. and Ireland. We're on track for our targets and our expansion into broadband and telephony positions us well to take advantage of a growing opportunity in a GBP20 billion industry."

(1) Broadband data stated as at 28 January 2007. As at 31 December 2006 
    gross bookings were 252,000 with 193,000 activated customers

(2) Adjusted gross margin excludes an exceptional gain from a third party
    channel provider of GBP65 million, accounted for within programming 

(3) Adjusted EPS excludes mark-to-market in derivative financial 
    instruments that do not qualify for hedge accounting, an exceptional 
    gain of GBP65 million and an exceptional charge of GBP6 million



Andrew Griffith                                Tel: 020 7705 3118
Robert Kingston                                Tel: 020 7705 3726


Matthew Anderson                               Tel: 020 7705 3267
Robert Fraser                                  Tel: 020 7705 3036


Alice Macandrew                                Tel: 020 7251 3801
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