On Nov. 8, satellite TV service provider DIRECTV Group (NYSE:DTV) released Q3 2006 earnings for the period ended Sept. 30.
- DIRECTV U.S. added 750,000 net subscribers over the past 12 months, and the total customer count now stands at 15.7 million. That 4.5% subscriber growth translated into a beefy 13% total sales boost, and GAAP earnings went on an absolute tear.
- The dramatic improvement in operational efficiency came from tight cost control, and more specifically, $455 million of customer acquisition costs compared with $708 million last year. Keeping costs fixed while growing revenues is a great recipe for profits.
- The company prefers to fuel its business with pure cash and has not taken on any new debt in the past year.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Avg. Est. |
Q3 2006 |
Q3 2005 |
Change | |
|---|---|---|---|---|
|
Sales |
$3,610 |
$3,667.0 |
$3,233.2 |
13.4% |
|
Net Profit |
-- |
$370.2 |
$94.6 |
291.3% |
|
EPS |
$0.27 |
$0.30 |
$0.07 |
328.6% |
|
Diluted Shares | -- |
1227.9 |
1395.5 |
(12.0%) |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q3 2006 |
Q3 2005 |
Change* | |
|---|---|---|---|
|
Gross Margin |
48.54% |
49.80% |
(1.26) |
|
Operating Margin |
17.13% |
4.84% |
12.29 |
|
Net Margin |
10.10% |
2.93% |
7.17 |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
Q3 2006 |
Q3 2005 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$2,272.1 |
$4,225.2 |
(46.2%) |
|
Accounts Rec. |
$1,155.5 |
$889.2 |
29.9% |
|
Inventory |
$167.6 |
$237.0 |
(29.3%) |
|
Liabilities |
Q3 2006 |
Q3 2005 |
Change |
|---|---|---|---|
|
Accounts Payable + Accrued Exp. |
$2,457.1 |
$2,298.8 |
6.9% |
|
Long-Term Debt |
$3,397.5 |
$3,408.2 |
(0.3%) |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
Q3 2006 |
Q3 2005 |
Change | |
|---|---|---|---|
|
Cash From Ops. |
$874.5 |
$373.4 |
134.2% |
|
Capital Expenditures |
$554.8 |
$182.8 |
203.5% |
|
Free Cash Flow |
$319.7 |
$190.6 |
67.7% |
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Related Companies:
- EchoStar Communications (NYSE:DISH)
- Comcast (NASDAQ:CMCSA)
- Time Warner (NYSE:TWX)
- TiVo (NASDAQ:TIVO)
Related Foolishness:
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At the time of publication, Fool contributor Anders Bylund had no position in any company mentioned. Fool rules are here.
