The DIRECTV Group Announces Second Quarter 2008 Results

Thursday, August 7th, 2008 
DIRECTV logo

EL SEGUNDO, Calif. — The DIRECTV Group, Inc. (NASDAQ:DTV) today reported that second quarter 2008 revenues increased 16% to $4.81 billion, operating profit before depreciation and amortization increased 20% to $1.36 billion and operating profit increased 8% to $801 million compared to last year’s second quarter. The DIRECTV Group reported that second quarter net income of $455 million increased 2% and earnings per share increased 8% to $0.40 compared with the same period last year.

DIRECTV U.S. Segment

Net subscriber additions of 129,000 were essentially flat compared with last year’s second quarter as the decline in average monthly churn rate to 1.49% mostly offset the slight decline in gross additions. The decline in gross additions to 894,000 was in part due to the end of the AT&T distribution agreement in the former BellSouth territories on April 1, 2008. The reduction in churn was principally due to a continued focus on attaining higher quality subscribers and an increase in the number of subscribers with advanced services. DIRECTV U.S. ended the quarter with 17.16 million subscribers, an increase of 5% over the 16.32 million subscribers reported on June 30, 2007.

Subscriber Data (in 000’s except Churn):

                                     Three Months       Six Months
DIRECTV U.S.                        Ended June 30,    Ended June 30,
                                   ----------------- -----------------
Gross Subscriber Additions             894      900    1,858    1,829
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Average Monthly Subscriber Churn      1.49%    1.58%    1.42%    1.51%
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Net Subscriber Additions               129      128      404      363
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Cumulative Subscribers              17,164   16,316   17,164   16,316
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DIRECTV Latin America Segment

In the second quarter of 2008, DIRECTV Latin America net subscriber additions increased 30% to 184,000 compared to the same period last year. The increase was due to higher gross additions mainly in Brazil, Argentina and Venezuela, partially offset by higher aggregate churn of 1.81% in the region. The increase in churn was primarily due to a 21,000 subscriber adjustment that was identified upon completing the integration of the Sky Brazil and DIRECTV Brazil businesses. Excluding the subscriber adjustment in Brazil, monthly churn would have been 1.61% which is higher than last year’s second quarter primarily due to higher churn in PanAmericana related to our prepaid business, competition and faster growth. The total number of DIRECTV subscribers in Latin America as of June 30, 2008 increased 24% to 3.66 million compared to 2.94 million as of June 30, 2007.

Subscriber Data (in 000’s except Churn):

                                        Three Months     Six Months
DIRECTV Latin America                  Ended June 30,  Ended June 30,
                                       --------------- ---------------
Gross Subscriber Additions                378     260     737     464
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Average Monthly Subscriber Churn         1.81%   1.38%   1.69%   1.39%
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Net Subscriber Additions                  184     141     384     229
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Cumulative Subscribers                  3,659   2,940   3,659   2,940
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