NEW YORK, April 28, 2015 /PRNewswire/ --
- First Quarter Revenue Increases 8% to $1.08 Billion
- Net Income Climbs 12% to $106
Million
- Adjusted EBITDA Jumps 19% to a Record $399 Million
- Free Cash Flow Reaches $276
Million, up 24%
- Company Increases 2015 Guidance for Revenue and
Subscribers
SiriusXM today announced first quarter 2015 operating and
financial results, including record first quarter revenue of
$1.08 billion, up 8% versus the first
quarter of 2014.
Net income was $106 million, up
12% from $94 million in the first
quarter of 2014. Net income per diluted common share was
$0.02 in the first quarter of 2015
and 2014. Adjusted EBITDA was $399
million in the first quarter of 2015, up 19% from
$335 million in the first quarter of
2014.
"The year is off to a fantastic start at SiriusXM. We are
increasing our subscriber guidance to approximately 1.4 million net
additions and revenue guidance to approximately $4.47 billion after reporting our best first
quarter for self-pay subscriber additions since 2008. Our results
demonstrate that SiriusXM's bundle of live news and sports,
exclusive talk and comedy, and curated, commercial-free music is
resonating with more and more consumers every day," said
Jim Meyer, Chief Executive Officer,
SiriusXM.
"This month, we have aired great live performances from the
Coachella music festival and exclusive programming from the Masters
golf tournament. Later this year, we will introduce new channels
led by Andy Cohen and Pitbull. We
continually seek to add new and exclusive talent, shows, and
channels that speak to our growing base of paying subscribers,"
added Meyer.
FIRST QUARTER 2015 HIGHLIGHTS
- Subscriber growth off to a strong start. SiriusXM added
431 thousand net new subscribers in the first quarter, a 61%
increase from the 267 thousand net new subscribers added in the
first quarter of 2014. Self-pay net subscriber additions were 394
thousand in the first quarter of 2015 compared to 173 thousand in
the first quarter of 2014. Marking the strongest first quarter for
self-pay subscriber growth since 2008.
- First quarter EBITDA climbs 19%. Adjusted EBITDA of
$399 million in the first quarter of
2015 was the highest quarterly amount in the company's history, an
increase of 19% over the $335 million
reported in the first quarter of 2014. Adjusted EBITDA margin was
37%, also the highest in the company's history.
- Free cash flow per diluted share climbs strongly. Free
cash flow of $276 million was up 24%
from $223 million in the first
quarter of 2014. Driven by higher cash flow and a lower share count
from the share repurchase program, free cash flow per diluted share
climbed an even stronger 36% to 4.9
cents in the first quarter of 2015, up from 3.6 cents in the first quarter of 2014.
"We repurchased 144 million shares for $534 million during the first quarter and
continue to see our shares as an attractive investment. With our
growing free cash flow, the successful placement of $1 billion of 5.375% Senior Notes in March, and
$1.25 billion of unused revolver
capacity, we have plenty of liquidity to continue returning capital
to shareholders while maintaining prudent leverage. In just over
two years since we began our capital return program with a special
dividend, we have paid our shareholders nearly $5.3 billion and retired nearly 22% of our then
outstanding shares," noted David
Frear, Chief Financial Officer, SiriusXM.
INCREASED 2015 GUIDANCE
The company increased its 2015 guidance for revenue and
subscribers, originally given on January 7,
2015, and reiterated its guidance for adjusted EBITDA and
free cash flow:
- Net subscriber additions of approximately 1.4 million,
- Revenue of approximately $4.47
billion,
- Adjusted EBITDA of approximately $1.6
billion, and
- Free cash flow of approximately $1.25
billion.
FIRST QUARTER 2015 RESULTS
SIRIUS XM HOLDINGS
INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME
|
(UNAUDITED)
|
|
|
For the Three
Months Ended
March 31,
|
(in thousands,
except per share data)
|
2015
|
|
2014
|
|
|
|
|
Revenue:
|
|
|
|
Subscriber
revenue
|
$
911,470
|
|
$
851,436
|
Advertising
revenue
|
26,873
|
|
22,214
|
Equipment
revenue
|
24,841
|
|
23,978
|
Other
revenue
|
117,806
|
|
100,083
|
Total
revenue
|
1,080,990
|
|
997,711
|
Operating
expenses:
|
|
|
|
Cost of
services:
|
|
|
|
Revenue share and
royalties
|
212,978
|
|
195,411
|
Programming and
content
|
71,146
|
|
74,870
|
Customer service and
billing
|
92,097
|
|
91,069
|
Satellite and
transmission
|
21,304
|
|
21,380
|
Cost of
equipment
|
8,845
|
|
7,804
|
Subscriber
acquisition costs
|
122,260
|
|
123,022
|
Sales and
marketing
|
78,744
|
|
76,327
|
Engineering, design
and development
|
14,960
|
|
15,911
|
General and
administrative
|
79,823
|
|
76,243
|
Depreciation and
amortization
|
65,027
|
|
68,267
|
Total operating
expenses
|
767,184
|
|
750,304
|
Income from
operations
|
313,806
|
|
247,407
|
Other income
(expense):
|
|
|
|
Interest expense, net
of amounts capitalized
|
(69,908)
|
|
(54,092)
|
Interest and
investment income
|
981
|
|
4,349
|
Loss on change in
value of derivatives
|
-
|
|
(27,023)
|
Other (loss)
income
|
(258)
|
|
95
|
Total other
expense
|
(69,185)
|
|
(76,671)
|
Income before income
taxes
|
244,621
|
|
170,736
|
Income tax
expense
|
(138,929)
|
|
(76,748)
|
Net income
|
$
105,692
|
|
$
93,988
|
Foreign currency
translation adjustment, net of tax
|
-
|
|
118
|
Total comprehensive
income
|
$
105,692
|
|
$
94,106
|
Net income per common
share:
|
|
|
|
Basic
|
$
0.02
|
|
$
0.02
|
Diluted
|
$
0.02
|
|
$
0.02
|
Weighted average
common shares outstanding:
|
|
|
|
Basic
|
5,570,748
|
|
6,094,784
|
Diluted
|
5,639,838
|
|
6,173,848
|
SIRIUS XM HOLDINGS
INC. AND SUBSIDIARIES
|
CONSOLIDATED BALANCE
SHEETS
|
|
|
As of March
31,
|
|
As of December
31,
|
|
2015
|
|
2014
|
(in thousands,
except per share data)
|
(unaudited)
|
|
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
482,043
|
|
$
147,724
|
Receivables,
net
|
219,421
|
|
220,579
|
Inventory,
net
|
22,937
|
|
19,397
|
Prepaid
expenses
|
135,960
|
|
116,336
|
Related party current
assets
|
3,374
|
|
4,344
|
Deferred tax
asset
|
937,767
|
|
1,038,603
|
Other current
assets
|
2,242
|
|
2,763
|
Total current
assets
|
1,803,744
|
|
1,549,746
|
Property and
equipment, net
|
1,477,657
|
|
1,510,112
|
Long-term restricted
investments
|
9,888
|
|
5,922
|
Deferred financing
fees, net
|
12,909
|
|
12,021
|
Intangible assets,
net
|
2,631,823
|
|
2,645,046
|
Goodwill
|
2,205,107
|
|
2,205,107
|
Related party
long-term assets
|
-
|
|
3,000
|
Long-term deferred
tax asset
|
402,279
|
|
437,736
|
Other long-term
assets
|
6,602
|
|
6,819
|
Total
assets
|
$
8,550,009
|
|
$
8,375,509
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts payable and
accrued expenses
|
$
548,863
|
|
$
587,755
|
Accrued
interest
|
67,750
|
|
80,440
|
Current portion of
deferred revenue
|
1,668,484
|
|
1,632,381
|
Current portion of
deferred credit on executory contracts
|
558
|
|
1,394
|
Current maturities of
long-term debt
|
7,546
|
|
7,482
|
Related party current
liabilities
|
4,860
|
|
4,340
|
Total current
liabilities
|
2,298,061
|
|
2,313,792
|
Deferred
revenue
|
156,102
|
|
151,901
|
Long-term
debt
|
5,101,886
|
|
4,493,863
|
Related party
long-term liabilities
|
12,925
|
|
13,635
|
Other long-term
liabilities
|
92,857
|
|
92,481
|
Total
liabilities
|
7,661,831
|
|
7,065,672
|
Stockholders'
equity:
|
|
|
|
Common stock, par
value $0.001; 9,000,000 shares authorized; 5,513,664 and 5,653,529
shares issued; 5,507,239 and 5,646,119 outstanding at March 31,
2015 and December 31, 2014, respectively
|
5,514
|
|
5,653
|
Accumulated other
comprehensive loss, net of tax
|
(402)
|
|
(402)
|
Additional paid-in
capital
|
6,243,166
|
|
6,771,554
|
Treasury stock, at
cost; 6,425 and 7,410 shares of common stock at March 31, 2015 and
December 31, 2014, respectively
|
(24,858)
|
|
(26,034)
|
Accumulated
deficit
|
(5,335,242)
|
|
(5,440,934)
|
Total stockholders'
equity
|
888,178
|
|
1,309,837
|
Total liabilities and
stockholders' equity
|
$
8,550,009
|
|
$
8,375,509
|
|
|
|
|
SIRIUS XM HOLDINGS
INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(UNAUDITED)
|
|
|
For the Three
Months Ended March 31,
|
(in
thousands)
|
2015
|
|
2014
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
105,692
|
|
$
93,988
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
65,027
|
|
68,267
|
Non-cash interest
expense, net of amortization of premium
|
1,852
|
|
5,231
|
Provision for
doubtful accounts
|
10,885
|
|
10,634
|
Amortization of
deferred income related to equity method investment
|
(694)
|
|
(694)
|
Gain on
unconsolidated entity investments, net
|
-
|
|
(4,326)
|
Dividend received
from unconsolidated entity investment
|
3,778
|
|
4,222
|
Loss on change in
value of derivatives
|
-
|
|
27,023
|
Share-based payment
expense
|
19,417
|
|
18,240
|
Deferred income
taxes
|
136,294
|
|
74,565
|
Other non-cash
purchase price adjustments
|
(836)
|
|
(945)
|
Changes in operating
assets and liabilities:
|
|
|
|
Receivables
|
(9,727)
|
|
(11,080)
|
Inventory
|
(3,540)
|
|
(5,124)
|
Related party
assets
|
192
|
|
654
|
Prepaid expenses and
other current assets
|
(19,102)
|
|
(15,682)
|
Other long-term
assets
|
215
|
|
718
|
Accounts payable and
accrued expenses
|
(27,918)
|
|
(68,168)
|
Accrued
interest
|
(12,690)
|
|
15,291
|
Deferred
revenue
|
40,304
|
|
34,861
|
Related party
liabilities
|
503
|
|
177
|
Other long-term
liabilities
|
377
|
|
3,538
|
Net cash provided by
operating activities
|
310,029
|
|
251,390
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Additions to property
and equipment
|
(29,831)
|
|
(28,601)
|
Purchases of
restricted and other investments
|
(3,966)
|
|
-
|
Acquisition of
business, net of cash acquired
|
-
|
|
1,144
|
Net cash used in
investing activities
|
(33,797)
|
|
(27,457)
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from
exercise of stock options
|
-
|
|
259
|
Taxes paid in lieu of
shares issued for stock-based compensation
|
(12,711)
|
|
(4,229)
|
Proceeds from
long-term borrowings and revolving credit facility, net of
costs
|
1,263,745
|
|
-
|
Repayment of
long-term borrowings and revolving credit facility
|
(657,731)
|
|
(152,528)
|
Common stock
repurchased and retired
|
(535,216)
|
|
(81,069)
|
Net cash provided by
(used in) financing activities
|
58,087
|
|
(237,567)
|
Net increase
(decrease) in cash and cash equivalents
|
334,319
|
|
(13,634)
|
Cash and cash
equivalents at beginning of period
|
147,724
|
|
134,805
|
Cash and cash
equivalents at end of period
|
$
482,043
|
|
$
121,171
|
Key Operating
Metrics
The following table contains our key operating metrics based on
our adjusted results of operations for the three months ended
March 31, 2015 and 2014,
respectively. Subscribers and subscription related revenues and
expenses associated with our connected vehicle services are not
included in our subscriber count or subscriber-based operating
metrics:
|
Unaudited
|
(in thousands,
except per subscriber and per installation amounts)
|
For the Three
Months Ended March 31,
|
2015
|
|
2014
|
Self-pay
subscribers
|
22,917
|
|
21,255
|
Paid promotional
subscribers
|
4,826
|
|
4,571
|
Ending subscribers
(a)
|
27,742
|
|
25,826
|
|
|
|
|
Self-pay
subscribers
|
394
|
|
173
|
Paid promotional
subscribers
|
37
|
|
93
|
Net additions
(a)
|
431
|
|
267
|
|
|
|
|
Daily weighted
average number of subscribers
|
27,406
|
|
25,602
|
|
|
|
|
Average self-pay
monthly churn
|
1.8%
|
|
1.9%
|
|
|
|
|
New vehicle consumer
conversion rate
|
40%
|
|
42%
|
|
|
|
|
ARPU
|
$
12.26
|
|
$
12.18
|
SAC, per
installation
|
$
33
|
|
$
35
|
Customer service and
billing expenses, per average subscriber
|
$
1.01
|
|
$
1.09
|
Free cash
flow
|
$
276,232
|
|
$
222,789
|
Adjusted
EBITDA
|
$
399,227
|
|
$
334,782
|
(a)Note: Amounts may
not sum as a result of rounding.
|
|
|
|
Glossary
Adjusted EBITDA - EBITDA is defined as net income
before interest and investment income (loss); interest expense, net
of amounts capitalized; income tax expense and depreciation and
amortization. We adjust EBITDA to exclude the impact of other
income and expense, loss on extinguishment of debt, loss on change
in value of derivatives as well as certain other charges discussed
below. This measure is one of the primary Non-GAAP financial
measures on which we (i) evaluate the performance of our
businesses, (ii) base our internal budgets and (iii) compensate
management. Adjusted EBITDA is a Non-GAAP financial performance
measure that excludes (if applicable): (i) certain
adjustments as a result of the purchase price accounting for the
merger of Sirius and XM, (ii) depreciation and amortization and
(iii) share-based payment expense. The purchase price accounting
adjustments include: (i) the elimination of deferred revenue
associated with the investment in XM Canada, (ii) recognition of
deferred subscriber revenues not recognized in purchase price
accounting, and (iii) elimination of the benefit of deferred
credits on executory contracts, which are primarily attributable to
third party arrangements with an OEM and programming
providers. We believe adjusted EBITDA is a useful measure of
the underlying trend of our operating performance, which provides
useful information about our business apart from the costs
associated with our physical plant, capital structure and purchase
price accounting. We believe investors find this Non-GAAP financial
measure useful when analyzing our results and comparing our
operating performance to the performance of other communications,
entertainment and media companies. We believe investors use current
and projected adjusted EBITDA to estimate our current and
prospective enterprise value and to make investment decisions.
Because we fund and build-out our satellite radio system through
the periodic raising and expenditure of large amounts of capital,
our results of operations reflect significant charges for
depreciation expense. The exclusion of depreciation and
amortization expense is useful given significant variation in
depreciation and amortization expense that can result from the
potential variations in estimated useful lives, all of which can
vary widely across different industries or among companies within
the same industry. We also believe the exclusion of share-based
payment expense is useful given share-based payment expense is not
directly related to the operational conditions of our
business.
Adjusted EBITDA has certain limitations in that it does not take
into account the impact to our statements of comprehensive income
of certain expenses, including share-based payment expense and
certain purchase price accounting for the merger of Sirius and XM.
We endeavor to compensate for the limitations of the Non-GAAP
measure presented by also providing the comparable GAAP measure
with equal or greater prominence and descriptions of the
reconciling items, including quantifying such items, to derive the
Non-GAAP measure. Investors that wish to compare and evaluate
our operating results after giving effect for these costs, should
refer to net income as disclosed in our unaudited consolidated
statements of comprehensive income. Since adjusted EBITDA is a
Non-GAAP financial performance measure, our calculation of adjusted
EBITDA may be susceptible to varying calculations; may not be
comparable to other similarly titled measures of other companies;
and should not be considered in isolation, as a substitute for, or
superior to measures of financial performance prepared in
accordance with GAAP. The reconciliation of net income to the
adjusted EBITDA is calculated as follows (in thousands):
|
Unaudited
|
|
For the Three
Months Ended March 31,
|
|
2015
|
|
2014
|
Net income
(GAAP):
|
$
105,692
|
|
$
93,988
|
Add back items
excluded from Adjusted EBITDA:
|
|
|
|
Purchase price
accounting adjustments:
|
|
|
|
Revenues
|
1,813
|
|
1,813
|
Operating
expenses
|
(836)
|
|
(945)
|
Share-based payment
expense (GAAP)
|
19,417
|
|
18,240
|
Depreciation and
amortization (GAAP)
|
65,027
|
|
68,267
|
Interest expense, net
of amounts capitalized (GAAP)
|
69,908
|
|
54,092
|
Interest and
investment income (GAAP)
|
(981)
|
|
(4,349)
|
Loss on change in
value of derivatives (GAAP)
|
-
|
|
27,023
|
Other loss (income)
(GAAP)
|
258
|
|
(95)
|
Income tax expense
(GAAP)
|
138,929
|
|
76,748
|
Adjusted
EBITDA
|
$
399,227
|
|
$
334,782
|
Adjusted Revenues and Operating Expenses - We define
this Non-GAAP financial measure as our actual revenues and
operating expenses adjusted to exclude the impact of certain
purchase price accounting adjustments from the merger of Sirius and
XM and share-based payment expense. We use this Non-GAAP financial
measure to manage our business, to set operational goals and as a
basis for determining performance-based compensation for our
employees. The following tables reconcile our actual revenues
and operating expenses to our adjusted revenues and operating
expenses for the three months ended March
31, 2015 and 2014:
|
Unaudited For the
Three Months Ended March 31, 2015
|
(in
thousands)
|
As
Reported
|
|
Purchase Price
Accounting
Adjustments
|
|
Allocation of
Share-based
Payment Expense
|
|
Adjusted
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
Subscriber
revenue
|
$
911,470
|
|
$
-
|
|
$
-
|
|
$
911,470
|
Advertising
revenue
|
26,873
|
|
-
|
|
-
|
|
26,873
|
Equipment
revenue
|
24,841
|
|
-
|
|
-
|
|
24,841
|
Other
revenue
|
117,806
|
|
1,813
|
|
-
|
|
119,619
|
Total
revenue
|
$
1,080,990
|
|
$
1,813
|
|
$
-
|
|
$
1,082,803
|
Operating
expenses
|
|
|
|
|
|
|
|
Cost of
services:
|
|
|
|
|
|
|
|
Revenue share and
royalties
|
$
212,978
|
|
$
-
|
|
$
-
|
|
$
212,978
|
Programming and
content
|
71,146
|
|
836
|
|
(2,227)
|
|
69,755
|
Customer service and
billing
|
92,097
|
|
-
|
|
(695)
|
|
91,402
|
Satellite and
transmission
|
21,304
|
|
-
|
|
(937)
|
|
20,367
|
Cost of
equipment
|
8,845
|
|
-
|
|
-
|
|
8,845
|
Subscriber
acquisition costs
|
122,260
|
|
-
|
|
-
|
|
122,260
|
Sales and
marketing
|
78,744
|
|
-
|
|
(3,744)
|
|
75,000
|
Engineering, design
and development
|
14,960
|
|
-
|
|
(2,134)
|
|
12,826
|
General and
administrative
|
79,823
|
|
-
|
|
(9,680)
|
|
70,143
|
Depreciation and
amortization (a)
|
65,027
|
|
-
|
|
-
|
|
65,027
|
Share-based payment
expense
|
-
|
|
-
|
|
19,417
|
|
19,417
|
Total operating
expenses
|
$
767,184
|
|
$
836
|
|
$
-
|
|
$
768,020
|
|
|
|
|
|
|
|
|
(a) Purchase price
accounting adjustments included above exclude the incremental
depreciation and amortization associated with the $785,000 stepped
up basis in property, equipment and intangible assets as a result
of the merger of Sirius and XM. The increased depreciation and
amortization for the three months ended March 31, 2015 was
$9,000.
|
|
Unaudited For the
Three Months Ended March 31, 2014
|
(in
thousands)
|
As
Reported
|
|
Purchase Price
Accounting
Adjustments
|
|
Allocation of
Share-based
Payment Expense
|
|
Adjusted
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
Subscriber
revenue
|
$
851,436
|
|
$
-
|
|
$
-
|
|
$
851,436
|
Advertising
revenue
|
22,214
|
|
-
|
|
-
|
|
22,214
|
Equipment
revenue
|
23,978
|
|
-
|
|
-
|
|
23,978
|
Other
revenue
|
100,083
|
|
1,813
|
|
-
|
|
101,896
|
Total
revenue
|
$
997,711
|
|
$
1,813
|
|
$
-
|
|
$
999,524
|
Operating
expenses
|
|
|
|
|
|
|
|
Cost of
services:
|
|
|
|
|
|
|
|
Revenue share and
royalties
|
$
195,411
|
|
$
-
|
|
$
-
|
|
$
195,411
|
Programming and
content
|
74,870
|
|
945
|
|
(2,215)
|
|
73,600
|
Customer service and
billing
|
91,069
|
|
-
|
|
(577)
|
|
90,492
|
Satellite and
transmission
|
21,380
|
|
-
|
|
(946)
|
|
20,434
|
Cost of
equipment
|
7,804
|
|
-
|
|
-
|
|
7,804
|
Subscriber
acquisition costs
|
123,022
|
|
-
|
|
-
|
|
123,022
|
Sales and
marketing
|
76,327
|
|
-
|
|
(3,566)
|
|
72,761
|
Engineering, design
and development
|
15,911
|
|
-
|
|
(1,926)
|
|
13,985
|
General and
administrative
|
76,243
|
|
-
|
|
(9,010)
|
|
67,233
|
Depreciation and
amortization (a)
|
68,267
|
|
-
|
|
-
|
|
68,267
|
Share-based payment
expense
|
-
|
|
-
|
|
18,240
|
|
18,240
|
Total operating
expenses
|
$
750,304
|
|
$
945
|
|
$
-
|
|
$
751,249
|
|
|
|
|
|
|
|
|
(a) Purchase price
accounting adjustments included above exclude the incremental
depreciation and amortization associated with the $785,000 stepped
up basis in property, equipment and intangible assets as a result
of the merger of Sirius and XM. The increased depreciation and
amortization for the three months ended March 31, 2014 was
$10,000.
|
Adjusted Cash Operating Expenses - We define this
Non-GAAP financial measure as our actual operating expenses
adjusted to exclude the impact of certain purchase price accounting
adjustments from the merger of Sirius and XM, depreciation and
amortization expense, and share-based payment expense. The
following table reconciles our actual operating expenses to our
adjusted cash operating expenses for the three months ended
March 31, 2015 and 2014:
|
Unaudited
|
|
For the Three
Months Ended March 31,
|
|
2015
|
|
2014
|
Operating expenses
(GAAP):
|
$
767,184
|
|
$
750,304
|
Items excluded from
adjusted cash operating expenses:
|
|
|
|
Purchase price
accounting adjustments
|
836
|
|
945
|
Share-based payment
expense (GAAP)
|
(19,417)
|
|
(18,240)
|
Depreciation and
amortization (GAAP)
|
(65,027)
|
|
(68,267)
|
Adjusted cash
operating expenses
|
$
683,576
|
|
$
664,742
|
ARPU - is derived from total earned subscriber
revenue, advertising revenue and other subscription-related
revenue, excluding revenue associated with our connected vehicle
business, divided by the number of months in the period, divided by
the daily weighted average number of subscribers for the period.
Other subscription-related revenue includes the U.S. Music Royalty
Fee. ARPU is calculated as follows (in thousands, except per
subscriber amounts):
|
Unaudited
|
|
For the Three
Months Ended March 31,
|
|
2015
|
|
2014
|
Subscriber revenue,
excluding connected vehicle (GAAP)
|
$
888,381
|
|
$
832,804
|
Add: advertising
revenue (GAAP)
|
26,873
|
|
22,214
|
Add: other
subscription-related revenue (GAAP)
|
92,654
|
|
80,768
|
|
$ 1,007,908
|
|
$
935,786
|
Daily weighted
average number of subscribers
|
27,406
|
|
25,602
|
ARPU
|
$
12.26
|
|
$
12.18
|
|
|
|
|
Average self-pay monthly churn - is defined as the
monthly average of self-pay deactivations for the period divided by
the average number of self-pay subscribers for the period.
Customer service and billing expenses, per average
subscriber - is derived from total customer service and billing
expenses, excluding connected vehicle customer service and billing
expenses and share-based payment expense, divided by the number of
months in the period, divided by the daily weighted average number
of subscribers for the period. We believe the exclusion of
share-based payment expense in our calculation of customer service
and billing expenses, per average subscriber, is useful as
share-based payment expense is not directly related to the
operational conditions that give rise to variations in the
components of our customer service and billing expenses. Customer
service and billing expenses, per average subscriber, is calculated
as follows (in thousands, except per subscriber amounts):
|
Unaudited
|
|
For the Three
Months Ended March 31,
|
|
2015
|
|
2014
|
|
|
|
|
Customer service and
billing expenses, excluding connected vehicle (GAAP)
|
$
84,061
|
|
$
84,103
|
Less: share-based
payment expense (GAAP)
|
(695)
|
|
(577)
|
|
$
83,366
|
|
$
83,526
|
Daily weighted
average number of subscribers
|
27,406
|
|
25,602
|
Customer service and
billing expenses, per average subscriber
|
$
1.01
|
|
$
1.09
|
|
|
|
|
Free cash flow and free cash flow per diluted
share - are derived from cash flow provided by operating
activities, capital expenditures and restricted and other
investment activity. The calculation for free cash flow and free
cash flow per diluted share are as follows (in thousands, except
per share data):
|
Unaudited
|
|
For the Three
Months Ended March 31,
|
|
2015
|
|
2014
|
|
|
|
|
Cash Flow
information
|
|
|
|
Net cash provided by
operating activities
|
$
310,029
|
|
$
251,390
|
Net cash used in
investing activities
|
$
(33,797)
|
|
$
(27,457)
|
Net cash provided by
(used in) financing activities
|
$
58,087
|
|
$
(237,567)
|
Free Cash
Flow
|
|
|
|
Net cash provided by
operating activities
|
$
310,029
|
|
$
251,390
|
Additions to property
and equipment
|
(29,831)
|
|
(28,601)
|
Purchases of
restricted and other investments
|
(3,966)
|
|
-
|
Free cash
flow
|
$
276,232
|
|
$
222,789
|
Diluted weighted
average common shares outstanding
|
5,639,838
|
|
6,173,848
|
Free cash flow per
diluted share
|
$
0.049
|
|
$
0.036
|
New vehicle consumer conversion rate - is defined as
the percentage of owners and lessees of new vehicles that receive
our satellite radio service and convert to become self-paying
subscribers after the initial promotion period. At the time
satellite radio enabled vehicles are sold or leased, the owners or
lessees generally receive trial subscriptions ranging from three to
twelve months. We measure conversion rate three months after the
period in which the trial service ends. The metric excludes rental
and fleet vehicles.
Subscriber acquisition cost, per installation - or SAC,
per installation, is derived from subscriber acquisition costs and
margins from the sale of radios and accessories, excluding purchase
price accounting adjustments, divided by the number of satellite
radio installations in new vehicles and shipments of aftermarket
radios for the period. Purchase price accounting adjustments
associated with the merger of Sirius and XM include the elimination
of the benefit of amortization of deferred credits on executory
contracts recognized at the merger date attributable to an OEM.
SAC, per installation, is calculated as follows (in thousands,
except per installation amounts):
|
Unaudited
|
|
For the Three
Months Ended March 31,
|
|
2015
|
|
2014
|
|
|
|
|
Subscriber
acquisition costs (GAAP)
|
$
122,260
|
|
$
123,022
|
Less: margin from
direct sales of radios and accessories (GAAP)
|
(15,996)
|
|
(16,174)
|
|
$
106,264
|
|
$
106,848
|
Installations
|
3,221
|
|
3,079
|
SAC, per
installation
|
$
33
|
|
$
35
|
|
|
|
|
About SiriusXM
Sirius XM Holdings Inc. (NASDAQ: SIRI) is the world's largest
radio broadcaster measured by revenue and has 27.7 million
subscribers. SiriusXM creates and broadcasts commercial-free
music; premier sports talk and live events; comedy; news; exclusive
talk and entertainment; and the most comprehensive Latin music,
sports and talk programming in radio. SiriusXM is available in
vehicles from every major car company in the U.S. and on
smartphones and other connected devices as well as online at
siriusxm.com. SiriusXM radios and accessories are available from
retailers nationwide and at shop.siriusxm.com. SiriusXM also
provides premium traffic, weather, data and information services
for subscribers in cars, trucks, RVs, boats and aircraft through
SiriusXM Traffic™, SiriusXM Travel Link, NavTraffic®, NavWeather™,
SiriusXM Aviation, SiriusXM Marineâ„¢, Sirius
Marine Weather, XMWX Aviationâ„¢, and XMWX Marineâ„¢.
SiriusXM holds a minority interest in SiriusXM Canada which has
more than 2 million subscribers. SiriusXM is also a leading
provider of connected vehicles services to major automakers, giving
customers access to a suite of safety, security, and convenience
services including automatic crash notification, stolen vehicle
recovery assistance, enhanced roadside assistance and turn-by-turn
navigation.
On social media, join the SiriusXM community on Facebook,
Twitter, Instagram, and YouTube.
This communication contains "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements include, but are not limited to,
statements about future financial and operating results, our plans,
objectives, expectations and intentions with respect to future
operations, products and services; and other statements identified
by words such as "will likely result," "are expected to," "will
continue," "is anticipated," "estimated," "believe," "intend,"
"plan," "projection," "outlook" or words of similar meaning.
Such forward-looking statements are based upon the current beliefs
and expectations of our management and are inherently subject to
significant business, economic and competitive uncertainties and
contingencies, many of which are difficult to predict and generally
beyond our control. Actual results may differ materially from
the results anticipated in these forward-looking
statements.
The following factors, among others, could cause actual
results to differ materially from the anticipated results or other
expectations expressed in the forward-looking statements: our
competitive position versus other radio and audio service
providers; our ability to attract and retain subscribers, which is
uncertain; our dependence upon the auto industry; general economic
conditions; changes in consumer protection laws and their
enforcement; the security of the personal information about our
customers; other existing or future government laws and regulations
could harm our business; failure of our satellites would
significantly damage our business; the interruption or failure of
our information technology and communications systems; royalties we
pay for music rights, which increase over time; the unfavorable
outcome of pending or future litigation; our failure to realize
benefits of acquisitions or other strategic initiatives; rapid
technological and industry changes; failure of third parties to
perform; failure to comply with FCC requirements; modifications to
our business plans; our indebtedness; and our principal stockholder
has significant influence over our management and over actions
requiring stockholder approval and its interests may differ from
interests of other holders of our common stock. Additional
factors that could cause our results to differ materially from
those described in the forward-looking statements can be found in
our Annual Report on Form 10-K for the year ended December 31, 2014, which is filed with the
Securities and Exchange Commission (the "SEC") and available at the
SEC's Internet site (http://www.sec.gov). The
information set forth herein speaks only as of the date hereof, and
we disclaim any intention or obligation to update any forward
looking statements as a result of developments occurring after the
date of this communication.
E - SIRI
Contact Information for Investors and Financial Media:
Investors:
Hooper Stevens
212 901 6718
hooper.stevens@siriusxm.com
Media:
Patrick Reilly
212 901 6646
patrick.reilly@siriusxm.com
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To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/siriusxm-reports-first-quarter-2015-results-300072804.html
SOURCE Sirius XM Holdings Inc.