View Full Version : Value of Sit-Up channels slashed

25-02-2009, 11:49 AM
<img src="/images/sitiuplogo.JPG" border="0" alt="sit up channels" title="sit up" hspace="4" align="right" />Virgin Media has slashed the value of its Sit-Up shopping channels by 54.8m after it failed to secure its second slot on the Freeview platform last year, plunging the cable operator deep into the red for the last three months of 2008.<br /><br />The board of the cable company, which said it gained 14,800 customers in the last three months of 2008, is expected to meet later this week to decide whether to sell its television channels business that includes a 50% share in the UKTV joint venture with the BBC.<br /><br />Analysts reckon Virgin Media TV, which includes channels such as Living, could be worth between 420m and 500m. In its fourth-quarter results, Virgin said its investment in UKTV is carried on its balance sheet at 354m, which includes outstanding loans of 138m.<br /><br />In the three months to the end of December Virgin's entire content business recorded revenues of 118.8m, up from 114.1m in the previous year after the company successfully renegotiated its carriage deal with BSkyB.<br /><br />But its Sit-Up business suffered a major setback when it ceased broadcasting on one of its two Freeview channels following its unsuccessful bid in the auction process for the renewal of its license.<br /><br />&quot;As a result of the loss of Sit-Up's second Freeview channel and the deterioration in the outlook for Sit-Up's business, management is reviewing the implications of these developments on Sit-up's business model and considering how best to address them,&quot; the company said.<br /><br />Writing down 54.8m of the value of the business pushed Virgin into a quarterly operating loss of 50.2m, compared with a 17.8m loss in the previous year. Its net loss was 241.4m, an increase from 120.8m in the third quarter and 163.2m in the previous year, due to the impairment charge and an increase in one-off charges as a result of the cost saving programme announced last year.<br /><br />Source: <a href="http://www.guardian.co.uk/media" target="_blank">MediaGuardian.co.uk<br /></a>