DirecTV Loses $283 Million

DirecTV Group Inc. reported Thursday a $283-million fourth-quarter loss as the operator of the nation’s biggest satellite TV service added a record number of subscribers at a higher cost.

DirecTV, which is majority owned by News Corp., also said that because of that higher cost, it intended to raise rates an average of 4% per customer in March.

The El Segundo-based company’s net loss for the period amounted to 20 cents a share, compared with a net loss of $310 million, or 22 cents a share, in the year-earlier quarter.

The narrower loss was because of an income tax benefit.

On an operations basis, excluding the benefit and other charges, DirecTV reported a loss of $437 million, compared with a loss of $177 million a year earlier. Analysts surveyed by Thomson First Call had expected a loss of 8 cents a share.

Revenue increased 22% to $3.36 billion from $2.75 billion in the year-earlier quarter. The increase reflected subscriber growth and the inclusion of new customers from the acquisition of two companies that serve primarily rural areas.

The increase in revenue was offset by the absence of revenue from its set-top-box manufacturing segment, which DirecTV sold last year as part of its transition to being a pure satellite TV provider.

DirecTV shares closed down 57 cents to $15.23 on the New York Stock Exchange.

For the year, DirecTV Group reported a net loss of $1.94 billion, or $1.40 a share, compared with a net loss of $361.8 million, or 26 cents a share, in 2003. Revenue increased to $11.36 billion in 2004, compared to $9.37 billion in the previous year.

During the most recent quarter, the company said it added a record 1.1 million subscribers. But after accounting for lost customers, the increase was 444,000. The cost of attracting those subscribers also rose as did retention and marketing costs.