ENGLEWOOD, Colo.—International cable operator Liberty Global Inc. said Thursday its third-quarter net income fell sharply because of a jump in operating expenses as it continues to roll out digital services around the world.
The company, spun off by cable entrepreneur John Malone’s Liberty Media Corp., posted an 8 percent increase in subscribers as it expanded its bundled services in Romania, the Czech and Slovak Republics, Switzerland and the Netherlands.
“Our rollout of digital TV services continues to be a major focus for us,” Chief Executive Officer Mike Fries said in a statement. “As we look ahead, we remain committed to our core strategy of organic growth, M&A and capital structure management.”
Net income fell to $40.4 million, or 10 cents per share, from $445 million, or $1.03 per share, in the year-ago period.
The latest quarter included a gain of $553 million from the sale of an equity stake, while the third quarter of 2006 reflected a $625.4 million gain from the sale of discontinued operations.
Revenue jumped 39 percent to $2.26 billion from $1.62 billion in the 2006 quarter, while operating costs increased to $2.17 billion from $1.51 billion last year, the company said.
Liberty did not provide an adjusted earnings figure. Analysts, whose estimates typically exclude items, expected on average a loss of 6 cents per share, on revenue of $2.23 billion. The most recent results were boosted by foreign exchange rates and small acquisitions.
In the first nine months, Liberty reported a net loss of $225.4 million, or 58 cents a share, compared with net income of $737.4 million, or $1.63 a share, in the comparable period of 2006. Revenue totaled $6.54 billion up from $4.7 billion in the year-ago quarter.
As of Sept. 30, Liberty Global reported 23.5 million revenue units, which included subscribers to telephone, television and Internet services. Fries said about 55 percent are buying advanced services, compared with 48 percent in the third quarter of 2006.
For the full year, Liberty said it will miss the lower end of its projection for 10 percent to 12 percent higher revenue because of weakness in its Japan, Netherlands and Romania units.
Liberty released the results after the market closed, and shares fell 20 cents to $39.29. Its shares had fallen 92 cents to $39.49 a share in regular trading Thursday.
