Virgin improves, but pressure on TV subs

Virgin Media is preparing for its acquisition by Liberty Global with a sixth consecutive quarterly fall in churn and a rise in TiVo penetration to 40% of the installed based.

The company said it had improved monthly churn from 1.2% to 1.1%, ARPU and its customer mix. However, net additions of 8,600 were lower than the 21,000 increase in the same period in 2012. It also lost 13,400 TV contracts. Virgin has been withdrawing in low-end TV packages and encouraging customers onto its TiVo-driven tiers.

Triple-play penetration now stands at 65%, quad-play penetration is at 16% and ARPU up 5.2% to £49.38.

TiVo customers increased 171,900 to 1.5m; Superfast broadband customers (30Mbps and above) increased 337,900 to 2.5m; 58% of the cable broadband base.

Neil Berkett, chief executive officer, Virgin Media, said: ‘We have had a good start to the year with accelerated revenue growth, improved churn, and strong free cash flow growth. The great value we provide through our Collections packages, which bundle superfast broadband and our next generation TiVo service, has seen new customers join and our existing customers stay loyal to us. This positive momentum in the business positions us well for our planned merger with Liberty Global.”

A strong financial performance saw revenues climb by 3.6% to £1,043 million.