NTL Debt Interest Turns Positive Result into $1bn Loss

08 November 2001

Debt-laden cable operator NTL announced Wednesday it had beaten its projections with a 15% increase in core earnings to $193 million (£132m) for the three months to September 30, on a 2% revenue rise to $944m (£645m).

However, once interest payments, depreciation and amortisation are factored in, the company made a staggering pre-tax loss of $1.04 billion (£713m). Moreover, interest payments on its $17bn debt totalled $356m – almost $4m daily.

NTL plans to make sufficient cash to cover interest by the middle of 2002, before moving cashflow into the black by the end of 2003. Chief executive Barclay Knapp said the group would save £100m a year from 2,000 planned job losses, and would mull a rise in prices following a similar move by satellite rival BSkyB.

During the quarter, NTL’s digital TV subscriber base rose 20% to 1.14m, on course for its target of 1.25m by year-end, and attracted 79,000 new broadband internet customers. It has 2.9m British residential subscribers, who on average pay £39.50 each per month.

News source: The Times (London)