Sogecable edges into the black

TV company posts $1.6 million profit

By JOHN HOPEWELL

MADRID -- Sogecable, Spain's biggest TV company, has edged into the black, posting profits of 1.2 million euros ($1.6 million), thanks to higher sub rates at satcaster Digital Plus and a standout performance from its free-to-air broadcaster, Cuatro.

Sogecable lost $27.2 million during January-March 2006. It last registered a profit in the second quarter of 2006.

First quarter 2007 revenues at Sogecable stood at $648.2 million, up 9.4% on first quarter 2006.

Launched November 2005, startup web Cuatro posted operating profits in March, which is considered a remarkable performance.

Driven by flagship show "House," which chalked up an average 18.6% share in March, plus local yakker "Noche Hache," which took a latenight first-quarter 10.3% share, Cuatro notched an all-day 7.7% share in March.

Ad revenues rose 101.0% at Cuatro year-on-year, reaching $78.6 million.

"You can attribute to many factors of Cuatro's growth to greater brand recognition -- the fact that it's now on viewers' radar," said Fabian Lares at Santo Espirito Investment.

"Cuatro seems to be adding 0.1 or 0.2 percentage points every month. If it goes on like this, it could register operating profits in the last quarter of 2007," Lares said.

Net subs at Sogecable satcaster rose 21,000 to 2.065 million, in line with market expectations.

But the brightest result for Digital Plus was a rise in average subscription revenues to $55.50 per subscriber a month.

Digital Plus has hiked subscription rates, but subscribers still appear to think they're getting a good deal: churn fell from 11.5% in the last quarter of 2006 to 10.9% during January-March.