Siurs XM, l'impervio cammino verso la salvezza

Sirius XM ha incontrato in questi giorni gli analisti finanziari e ha cercato di tracciare un quadro di lucido, ma aggressivo ottimismo per il suo futuro. Il Ceo della società Mel Karmazin, non può nascondere la pesante situazione debitoria, ma afferma che l'operatore radio satellitare se la caverà con una poderosa crescita del numero degli abbonati. Tra cinque anni dovrebbero superare quota 28 milioni: un esercito di ascoltatori che genererà oltre 4 miliardi di dollari di revenues. Questo articolo di Radio and Records nonentra troppo nel dettaglio della "maturity" dei debiti di Sirius Xm, che ha una tabella di marcia non meno impressionante (e a differenza del numero di abbonati, il debito è debito, non una semplice stima ottimistica). All'articolo di Radio and Records faccio seguire le note finanziarie che ho trovato su 24/7 Wall St., sono interessanti, specie lo scadenziario del debito da qui al 2013. Per allora Sirius XM dice di puntare su un flusso di cassa positivo a 1,4 miliardi di dollari ma in mezzo c'è il difficile guado di una nazione che deve fronteggiare un paio d'anni di crisi, soprattutto nella fiducia dei consumatori (e di crisi dell'auto, pessima cosa per una radio che si ascolta soprattutto a bordo delle autovetture). I programmi radiofonici satellitari dovranno essere molto, molto convincenti.
Nel frattempo, in questi mesi Sirius ha leggermente incrementato le revenues e tagliato su costi e numero di canali (ridondanti dopo il merger con XM Radio). Da oltre duemila persone l'azienda passa a 1.600 stipendiati. I canali musicali scendono da 130 a 67. L'obiettivo è un risparmio di oltre 400 milioni, in modo da coprire i debiti in scadenza per il 2009 (per il 2010, infatti, Sirius non prevede altre maturità negative, che riprendono nel 2011). Come hanno reagito gli analisti? In queste ore il titolo Sirius è in rialzo, sì. Ma vale tuttora meno di 14 centesimi di dollaro, la variazione in positivo si misura in millesimi. Il buon vecchio Mel dev'essere uno che ama vivere pericolosamente.

Sirius XM CEO: Revenue Up Over Last Year

Dec 18, 2008

-By Jeffrey Yorke, Radio and Records

Sirius XM expects to conclude the year with 19.1 million subscribers and revenues of $2.4 billion, up from $2.1 billion last year, CEO Mel Karmazin told attendees of the newly merged satellite radio operation during an annual shareholders meeting Thursday (Dec. 18) in Manhattan.
Despite a hideous year of slowing sales by vehicle manufacturers, the satcaster forecasts that 2008 will end with about 500,000 more new vehicle subscriptions to the satellite service for a total of 5.8 million, more than the 5.3 million achieved during the previous year by Sirius and XM operating as separate entities. The company expects subscriptions to be sold in 50 percent of all new cars in 2009 and to end 2009 with 20.6 million subscribers and revenues of about $2.7 billion.
While satellite radio subscriptions continue to grow, there is evidence that they are slowing. The company said it gained 10 percent more subscribers this year, compared to 27 percent growth in 2007 and a whopping 48 percent growth in 2006.
Declining subscriber growth aside, the company argued it is among the fastest growing U.S. media businesses. Sirius XM expects to grow 2009 revenues by 13 percent compared to a 9 percent gain by DirecTV, 8 percent by Cablevision, 6 percent by Time Warner and Comcast, 3 percent by Dish Network, while terrestrial radio is estimated to decline 9 percent.
By merging operations, Sirius XM expects combined synergies to save it $429 million in 2009. It has also cut its staff by 22 percent, dropping its headcount from 2,058 to 1,600 by year's end.
In November, the company concluded a "channel rationalization" realignment, and subsequently eliminated duplication on its 130 music channel lineup, which dropped to 67 music channels, 63 of them shared by the separate Sirius and XM services. There were 164 talk/sports channels reduced to 147 channels. Sirius has 75 talk/sports channels, while XM has 134 channels (including part-time channels) and there are 38 shared channels. In a filing with the Securities and Exchange Commission Thursday, the company reported that the channel reductions will save $35 million annually and that there were 10,000 consumer cancellations in the wake of the realignment.
By way of long range guidance, Sirius XM expects subscriptions to grow at an impressive clip in the coming years, jumping from an estimated 20.6 million in 2009 to 22.1 the following year, to 24 million in 2011, to 26.2 million in 2012 and to 28.4 million by 2013 with revenues reaching $4.1 billion that year.
But, before any of that happens, the company has to clear some major debt hurdles in the coming months. Karmazin said that among the management priorities is resolving the 2009 liquidity problem by restructuring and reducing a total of $995 million in debt, some $209 million incurred by the old Sirius that is due in February, and $350 million of old XM debt that matures in May 2009. Other management focus points, Karmazin said, include maximizing synergies, growth EBITDA and free cash flow, maintaining growth, and, the vintage Wall Street/public company adage, "enhancing shareholder value."

***

The companyany expects 19.1 million subscribers at the end of 2008. It sees stable self-churn rates at 1.77% expected for this year. The company's expected
revenue 2008 is expected at $2.4 billion. Its post-merger headcount is down more
than 20%.
SIRIUS puts its adjusted EBITDA guidance for 2008 at -$200 million versus prior
expectations of -$300 million. This implies a Q4-2008 adjusted EBITDA improvement of 86% to -$32 million from last year.
Karmazin also maintains that SIRIUS XM will grow faster than other major media companies in 2009 with penetration gains in every major auto maker. It sees ending 2009 with roughly 20.6 million subscribers and revenues of roughly $2.7 Billion. It also sees the 2009 merger synergies at $425 million and growing. The company is still calling for positive EBITDA in 2009 with approximately $300 million in the year.
More important than anything is the long-term guidance. You can bet that this will change drastically, but here are the long-term goals of the company:

[cifre relative agli anni 2009-2013, abbonamenti in milioni, valori in miliardi di dollari]
Ending Subscribers: 20.6; 22.1; 24.0; 26.2; 28.4
Total Revenue: $2.7; $3.0; $3.4; $3.8; $4.1;
Adjusted EBITDA: $0.3; $0.6; $0.9; $1.3; $1.5;
Free Cash Flow: $0.0; $0.4 ; $0.6 ; $1.0; $1.4;

As far as liquidity, SIRIUS sees $995 million in debt maturities in 2009, yet sees $0 in 2010. For the years beyond, it sees the following in annual debt maturities:

$230 million in 2011;
$248 million in 2012;
$500 million in 2013;
$1.334 billion maturing in 2014;