MUNICH -(Dow Jones)- German pay-TV company Sky Deutschland AG (SKYD.XE) will remain loss-making in fiscal 2011 but will give more detailed guidance on outlook in August, Chief Executive Brian Sullivan said Thursday at an industry event in Munich.
Sullivan promised the long-awaited guidance will come when the company reports second-quarter results mid August. In the meantime Sky Deutschland is still loss-making despite two good quarters, Sullivan said.
Earlier this week James Murdoch, News Corp.'s (NWS) chief executive for Europe and Asia said the media conglomerate's investment in Sky Deutschland is now profitable. The remarks were misinterpreted in the market and led to a sharp rise in the share price Tuesday, as investors mistakenly thought long-time loss making Sky Deutschland had turned profitable.
At Thursday's event Sullivan confirmed that Sky Deutschland will post a loss before taxes, depreciation and amortization of EUR260 million to EUR270 million in fiscal 2010 and will also be loss-making in 2011.
Since taking an initial 14.6% stake in Jan. 2008, News Corp. has injected around EUR1 billion into the company, of which it now owns 49.9%.
Sullivan also told Dow Jones Newswires he is looking for a cooperation agreement with Germany's biggest cable network provider Kabel Deutschland Holding AG (KD8.XE), similar to the one Sky Deutschland has already with smaller peer Kabel BW, in an attempt to boost sales. Sullivan said he is confident of reaching an agreement with Kabel Deutschland in the course of this year but negotiations with bigger market participants are more complex and the pay-TV company needs to avoid any financial drawbacks from a new agreement with Kabel Deutschland.
Speaking at Thursday's industry conference Sullivan he is not expecting to lose the rights to top-flight Bundesliga soccer matches in summer 2013, as losing them would pose a serious threat to Sky Deutschland.
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