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BSkyB Q3 results
The quarter was little different from last year with growth in subscribers, subscriptions to the newer services (Sky+ and multi-room), and turnover is much in line with last year. Margin improvements continued, adjusted EPS rose 51% and Sky is on track to meet full year expectations.
The still accelerating growth justifies the fairly high PE (17× earnings for the year to June 2006) but our concern remains the limits of growth - Sky is already the market leader and it clearly can not continue to increase its customer base at this rate. However, despite competition that has been revived by free to air digital TV, Sky still has no serious direct competitors and it has plenty of scope in the medium term to further improve margins.
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