Canadian Satellite Radio Holdings Inc., parent of XM Canada and Sirius Canada, reports that in the quarter prior to a merger between the two firms, XM’s loss narrowed, while profit grew at Sirius, excluding merger costs.
In the three months ended May 31, XM Canada’s third quarter, it lost $9.8 million, down from $9.95 million in the year earlier, while revenue grew 18.7% to $16.8 million from $14.1 million. Self-paying subscribers grew by 10.4% to 457,800 from 414,500.
Sirius’s profit grew in its second quarter to $6.01 million from $4.43 million a year ago with revenues increasing by 19.1% to $43 million from $36.1 million. Self-paying subscribers grew by 16.5% to 866,430 from 744,000.
XM Canada incurred merger costs of $2.5 million, while Sirius Canada reported costs of $445,000.
The company says the results do not reflect the financial position of the merged business, but the situations at the stand alone companies for the period that ended just prior to the combination.
“While both XM Canada and Sirius Canada’s numbers are impressive on a stand alone basis, the merged entity is currently expected to accelerate growth and profitability in a significant way going forward,” said Mark Redmond, president and CEO of SiriusXM Canada.
“The combined entity now has over 1.9 million total subscribers placing SiriusXM Canada in the top tier of media and entertainment companies in Canada. We now have a company with revenues in excess of $200 million annualized and currently expect to realize synergies of approximately $20 million on an annualized basis over the next 18 months. Our seasoned management team and strong cash flow position us well for the future.”
The merger was completed last month, when the combined company also closed its refinancing. It now has about $150 million in long-term debt. Canadian Satellite Radio Holdings Inc. operates as SiriusXM Canada, which has more than 120 satellite radio channels.
