Satellite television provider Dish Network Corp. (DISH) on Monday reported a 42 percent surge in profit for the fourth quarter from last year on higher revenues.
Earnings per share beat analysts' expectations, while quarterly revenues missed their estimates. The company also recorded pay-TV subscriber losses in the quarter amid a programming dispute with 21st Century Fox Inc. (FOX,FOXA).
Dish also said that President and Chief Executive Officer Joseph Clayton will retire from his position, effective March 31, 2015. He will be succeeded in those roles by Dish Co-founder and Chairman Charles Ergen.
The company noted that gross new pay-TV subscriber activations during the latest period were negatively impacted by programming interruptions in connection with scheduled expiration of certain programming carriage contracts with several content providers.
In addition, gross new pay-TV subscriber activations continued to be negatively impacted by increased competitive pressures, including aggressive marketing, discounted promotional offers and more aggressive retention efforts.
The Englewood, Colorado-based company reported fourth-quarter net income attributable to the company of $409.93 million or $0.88 per share, up from $288.04 million or $0.63 per share in the prior-year quarter.
On average, 22 analysts polled by Thomson Reuters expected the company to report earnings of $0.43 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter grew 4 percent to $3.68 billion from $3.54 billion in the same quarter last year, but missed analysts' consensus estimate of $3.70 billion.
The company activated about 615,000 gross new pay-TV subscribers in the quarter, down from last year's 654,000.
Total pay-TV subscribers in the quarter declined about 63,000, compared to additions of about 8,000 net Pay-TV subscribers last year, primarily resulting from lower gross new Pay-TV subscriber activations. The company closed the quarter with 13.98 million pay-TV subscribers, compared to 14.06 million pay-TV subscribers a year ago.
Dish started to again show Fox News and Fox Business News in mid-January, after reaching an agreement with 21st Century Fox. The deal ended a closely-watched stalemate that began on December 21, 2014 when Dish blacked out the Fox stations in a disagreement over fees paid by satellite providers to carry the channels.
Pay-TV ARPU for the quarter totaled $84.17, a 3.6 percent increase over $81.24 a year ago, primarily reflecting programming package price increases and higher hardware related revenue.
Pay-TV subscriber churn rate rose to 1.61 percent from 1.53 percent last year. The company noted that its pay-TV churn rate continued to be adversely affected by increased competitive pressures.
DISH added only about 24,000 net broadband subscribers in the quarter to bring its broadband subscriber base to about 577,000, compared to last year's addition of about 51,000 net broadband subscribers. The decrease primarily resulted from lower gross new broadband subscriber activations and a higher number of customer disconnects.
For fiscal 2014, Dish net income rose to $945 million or $2.04 per share from $807 million or $1.76 per share in the previous year. Revenues for the year grew 5 percent to $14.6 billion from $13.9 billion in the prior year.
Street expected the company to earn $1.59 per share for the year on revenues of $14.66 billion.
DISH is trading at $79.85, up $1.54 or 1.97 percent on a volume of 298,693 shares.
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