DISH Network Corp. (DISH) declared mixed financial results for the fourth quarter of 2013. The bottom line outpaced the Zacks Consensus Estimate but the top line missed the same. Yesterday, the largest satellite TV operator in the U.S. – DIRECTV (DTV) – also reported robust fourth-quarter 2013 financial results.
At the end of the fourth quarter of 2013, DISH Network had approximately 14.057 million pay-TV subscribers against 14.056 million at the end of the prior-year quarter. The company gained net 8,000 pay-TV subscribers in the reported quarter as compared with 14,000 subscribers in the same period last year. Further, the company added net 51,000 broadband subscribers against 44,000 in the fourth quarter of 2012. At the end of fiscal 2013, DISH Network had 436,000 broadband subscribers.
Quarterly net income was $288 million or 64 cents per share compared with $209.1 million or 52 cents per share in the year-ago quarter. Fourth-quarter 2013 earnings per share of 64 cents were significantly above the Zacks Consensus Estimate of 40 cents. Quarterly total revenue stood at approximately $3,538.5 million, up 6.6% year over year but below the Zacks Consensus Estimate of $3,590 million.
DISH Network posted total revenue of $13904.9 million for full fiscal 2013. Segment wise, quarterly Subscriber related revenues were $3,500.1 million, up 6.3% year over year while it generated revenues of $13, 764.8 million for full fiscal 2013, up 5.4% year over year. Equipment and merchandise sales & other revenues for fiscal 2013 came in at $94.9 million, down 3.7% from the year-ago quarter. Equipment sales, services and other revenues from EchoStar for the same period totaled $45.2 million, up 152.5% year over year.
Average monthly pay-TV subscriber churn rate in the fourth quarter of 2013 was 1.53% compared with 1.54% in the prior-year quarter. Average revenue per user was $81.24 against $77.47 in the year-ago quarter. Average subscriber acquisition cost in the fourth quarter of 2013 was $863 compared with $791 in the year-ago quarter.
In the reported quarter, Subscriber-related expenses crept up 9.3% year over year to $2,005.7 million. Depreciation and amortization expenses were $266.2 million, up 12.5% from the prior-year quarter. Accordingly, quarterly EBITDA was $888.3 million as against $721.8 million in the year-ago quarter.
At the end of 2013, DISH Network generated $2,309.2 million of cash from operations compared with $2,003.7 million in the prior-year period. Free cash flow (cash flow from operations less capital expenditures) at the end of the reported period was $1,055.7 million against $1,058.4 million in the year-ago period.
At the end of fiscal 2013, DISH Network had $9,739.4 million of cash and marketable securities and $12,616 million of outstanding debt on its balance sheet compared with $7,237.7 million of cash and marketable securities and $11,350.4 million of outstanding debt at the end of 2012.
Other Stocks to Consider
DISH Network currently has a Zacks Rank #3 (Hold). Other better-ranked stocks in the same industry which are worth considering include Cablevision Systems Corporation (CVC) and Time Warner Cable Inc. (TWC). Both of them currently carry a Zacks Rank #2 (Buy).
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