Sky Network Television, New Zealand's major pay-TV company, posted a 3.8 per cent gain in first-half profit, reflecting a jump in subscribers to its My Sky set-top box and higher revenue per user on the back of new channels such as SoHo.

Net profit rose to $62.6 million, or 16.08 cents a share, from $60.4 million, or 15.49 cents a year earlier, the Auckland-based company said in a statement. Sales rose 7.3 percent to $426.9 million. The results about matched forecasts from Forsyth Barr and First NZ Capital.

The company's My Sky subscribers rose 43 percent to 331,041, pushing the total customer base to 846,340. Sky's services are now beaming into 49.2 percent of the nation's 1.6 million households, up from 47.6 percent a year earlier. Shares of the company climbed 2 percent from a 1 ½-year low to $5.05.

"The improved financial position is primarily due to the continued success of the My Sky HDi decoders, a positive period for advertising sales, higher average revenue per user resulting from revenues from the new SoHo channel which launched in November 2011 and strong subscriber acquisition," chief executive John Fellet said in the statement.


The company didn't give guidance for the full year. It will pay a first-half dividend of 11 cents, more than analysts had expected and up from 8 cents a year earlier.

Gross churn, the total percentage of subscribers who left during the period, rose to 14.2 percent from 13.6 percent a year earlier. Still, Fellet said My Sky was having a positive impact on the churn rate by encourage subscribers to retain the service.

Expenses in the latest six months rose about 8 percent to $322.9 million. Programming costs rose 5.8 percent and partly reflects the costs of Sky being the host broadcaster for the 2011 Rugby World Cup.

The company said 49,753 subscribers had taken up its SoHo channel as at December 31, paying an extra $10 a month for programming dominated by the likes of HBO shows.
Sky's shares are rated 'outperform' based on the consensus of 10 recommendations compiled by Reuters.