British cable operator Virgin Media
Much like rival BSkyB
Also like BSkyB, the strategy appears to be paying off, as the number of customers taking its new TiVo TV service, which offers on-demand programming and recommendations, more than doubled in the fourth quarter with 273,000 net additions.
It had 435,000 TiVo customers at the end of the year, 12 percent of the overall TV base. Also during the quarter, 133,000 new and existing customers moved to its superfast broadband offering.
We are seeing the work that we have been doing over the last few years -- building better capability in the network, better broadband and now launching TiVo. We are seeing the combination really starting to give us a competitive advantage, chief executive Neil Berkett told Reuters.
Overall, the group attracted 15,000 net new cable customers in the quarter, helping it show strong cash generation.
Revenue for the quarter was up 2 percent to 1.0 billion pounds, broadly in line with forecasts, while operational cash flow and free cash flow were up 5 percent and 1.1 percent respectively, both ahead of forecasts.
In a fast-changing industry and an uncertain economic environment, our 2011 results demonstrate the underlying resilience of Virgin Media's business model, with modest revenue growth driving robust operating cash flow and record free cash flow, the group said.
Our next accelerated stock repurchase of $250 million shows our ability and commitment to translate the cash generative characteristics of our business into shareholder value.
While Virgin Media does not give an official outlook, Berkett said he was happy with the progress it was making and said he was not seeing any deterioration over its performance in the last couple of quarters.
Goldman Sachs said it expected the results to support Virgin Media stock, which is traded in the United States, if it can maintain a stable customer base.
(Editing by Paul Sandle and Dan Lalor)