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CSR passes 2 million subscribers but posts loss

File photo of Canadian Satellite Radio CEO Mark Redmond.

Deborah Baic/Deborah Baic/The Globe and Mail

Canadian Satellite Radio Holdings Inc. crossed the two million subscriber mark, but the recently merged Sirius Canada and XM Canada posted a loss for its most recent quarter.

The company saw revenue increase 6.6 per cent to $63.1-million, compared to $59.2-million last year. It added to its growing cash pile, with $35.2-million in the bank after adding $9-million in the quarter.

"We have only started to capitalize on the opportunities available to us as a merged company and are focused on further strengthening our financial results by adding subscribers, maintaining our existing subscribers and driving increased operating efficiency across the organization," chief executive officer Mark Redmond stated.

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While it crossed the two million mark, only 1.4-million of those customers were "self-paying." That's the industry term for customers who pay for the service out of their pocket, rather than listening through a promotional package.

The company said it cost $54 to acquire each customer in the quarter, compared to $63 a year ago. Satellite radio companies rely largely on the automotive industry to source new sales, because new cars are often outfitted with receivers. About half of all the new cars sold in Canada in 2012 are expected to have a satellite radio receiver installed.

The company was formed in June when two competing satellite radio services merged. The company combined the two company's financial records to provide year-over-year comparisons. The company lost 3 cents a share, or $3.4-million, in the quarter. That compares to a 4 cents a share profit a year ago, or $3.5-million.

SiriusXM – the American satellite radio provider – announced its results yesterday. It posted a $71-million profit, with 21-million subscribers. So-called self-pay subscribers, who pay for their own subscriptions (compared to free trial subscribers), rose seven per cent to 374,432.

Subscriber acquisition costs per gross subscriber addition rose by five per cent to $55 compared to $58 a year ago. Only 44 per cent of those who received a free trial with their vehicle opted to keep the service.

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