The UK business (EAUS) is continuing to improve ahead of guidance as expected and its turnround can now be judged a success. Management has announced an aggressive plan to extract synergy from the recently acquired Thus
Prisa, the 98% owner of Sogecable, has put Spain’s leading pay-TV platform Digital+ up for sale in order to make a large reduction in its debts
In our view the potential for synergies from an acquisition of Thus by C&W, though more limited than might be supposed, would still have a significant impact on the combined entity at the EBITDA level
International performance continued to be weak apart from Macau, although well within EBITDA guidance. Turnaround in Jamaica remains a significant challenge
International performance was hit by problems in Jamaica and was weak generally except for Panama and Macau
Rising audiences for Cuatro in a booming TV advertising market have unexpectedly lifted Sogecable earnings in H1 2007, encouraging confidence that Cuatro will achieve breakeven in 2008, if not in 2007
The performance of the international business remains solid
With 84,000 net pay-TV additions in 2006, Sogecable resumed subscriber growth, but we expect this pace to decline in 2007 unless Sogecable re-positions on basic and expands distribution from satellite to cable and DSL