Record Profits Of £1.2bn For BSkyB

BSkyB (LSE: BSY.L - news) , the company which owns Sky News, has reported a 14% rise in operating profit for its last financial year to £1.2bn - a record for the broadcaster.

While it missed the average estimate for revenue growth among City analysts, rising by 4.5%, the firm said its performance was boosted by a growing telephony and broadband customer base.

Total (Other OTC: TTFNF.PK - news) customer numbers hit 10.6 million by the end of the year to June 30 - an increase of 312,000.

Four million BSkyB customers now take its broadband services while total TV subscribers grew by 101,000 over the 12 months.

The performance helped its share price rise 2% when the FTSE 100 (Euronext: VFTSE.NX - news) opened for business.

The company also announced this morning that it was to launch its broadband and talk service in the Republic of Ireland (Xetra: A0Q8L3 - news) later this year and confirmed that from today its 'on the move' app for Sky customers, Sky Go, would offer for the first time kids' programmes on eight channels from brands including Disney (NYSE: DIS - news) and Cartoon Network.

Channel 5 would also add its catch-up content to Sky Anytime Plus later this year when the BBC and ITV (Other OTC: ITVPF.PK - news) also join the service.

The company's chief executive, Jeremy Darroch, said it had been a strong year for BSkyB.

He said: "Our consistent approach of investing where it matters most to customers and improving efficiency behind the scenes is working extremely well.

“In what remains a tough economic environment, customers are choosing Sky over other providers."

He confirmed Sky was increasing returns to shareholders and intended to seek approval for a further £500m of share repurchases.

As the media regulator Ofcom continues to consider whether BSkyB is a fit and proper holder of a broadcasting licence amid the focus on News Corporation (NasdaqGS: NWS - news) , which owns 39.1% of BSkyB's shares, Mr Darroch also moved to highlight the company's value to the UK economy by citing the conclusions of a report by independent consultants, Oxford Economics.

He said: "It finds that Sky contributes over £5bn a year to UK GDP, supports nearly 120,000 jobs and a £2.3bn contribution to tax revenues.

"In the last 12 months, we have created 2,200 new permanent jobs at Sky as we continue to invest in customer service, programme production and technology innovation."

BSkyB released results on the same day as Talk Talk and ITV.

Talk Talk said while its total broadband customer base had fallen to 4.04 million in its first quarter, it had returned to growth since June saying connection rates had been hit by the porr summer weather.

ITV posted a 15% rise in first half pre tax profit to £235m on the back of a 3% rise in advertising revenues.

However, the broadcaster forecast a fall in revenues over the summer as viewers tuned in to the Olympics coverage on the BBC.

It expected a largely flat performance in the nine months to the end of September.