Sky TV profits drop on rising UK football costs

 European pay-TV giant Sky, set for a takeover by 21st Century Fox, announced Thursday a drop in profits, hit by the rising cost of showing live English Premier League football.

A fall in operating profits for the first nine months of Sky's financial year overshadowed a rise in revenues, the company said in an earnings statement.

"In a year in which we are absorbing significantly higher programming costs, we continue to make further progress on our efficiency plans, with operating costs down a further one percent," Sky said.

Group revenues increased five percent to £9.64 billion ($12.37 billion, 11.52 billion euros) in the nine months to March 31 compared with the equivalent period in 2015/16.

Operating profit dropped 11 percent to around £1.0 billion as Sky was hit by additional costs of £494 million linked to screening live Premier League matches featuring sides including Manchester United, Liverpool, Arsenal and Leicester.

Sky said it had added 106,000 new customers during its third quarter, or three months to the end of March.

The results were published after the European Commission earlier this month cleared Fox's multi-billion dollar buy-out of Sky.

Media tycoon Rupert Murdoch's Fox announced in December a deal to buy the 61-percent stake in Sky it did not already own for 11.7 billion pounds.

The tie-up stirred fears that the Murdoch family would gain too much control over Britain's media and the UK government has announced its own probe into the deal.

21st Century Fox is one of the world's largest entertainment companies with a vast portfolio of cable, broadcast, film, pay-TV and satellite assets across six continents.

Sky broadcasts a similar offering, including the 24-hour Sky News channel, and provides also internet and telephone services. In late 2014, Sky changed its name from BSkyB after buying Sky Italia and a majority holding in Sky Deutschland.

source: AFP