El Segundo, Calif. - Driven by continued improvement in the operating performance of its Direct-To-Home Broadcast DirecTV satellite service segment, Hughes Electronics reported an 8.3 percent increase in revenue for the fourth quarter, reaching $2.5 billion in the three months, up from $2.3 billion in the year-ago period.
Hughes registered fourth quarter net income of $115.3 million, compared with a net loss of $132.6 million in the same three months in 2001. Primary reasons for the improvement were a lower operating loss and a pre-tax gain of $600 million related to the settlement with EchoStar Communications in connection with the termination of the two companies' proposed merger.
Fourth quarter revenue for Hughes' DirecTV segment climbed 15.1 percent, hitting nearly $2 billion, compared with $1.7 billion in the same three months in 2001. The segment registered Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of $44.8 million, compared with negative EBITDA of $5.3 million in the fourth quarter of the previous year. The segment's operating loss was reduced to $142.3 million, down from a loss of $176.1 million year over year.
Continued subscriber growth and higher monthly revenue per subscriber helped drive up DirecTV's business in the United States, with revenue for the fourth quarter, ending Dec. 31, rising 19 percent, to $1.8 billion, up from $1.5 billion in the same three months in 2001. EBITDA for the fourth quarter was $191 million, compared with $63 million in the last three months of the previous year.
Subscriber growth for DirecTV in the United States climbed from 10.3 million in the fourth quarter of 2001, to 11.2 million in the same period of 2002.
Hughes revenue for 2002 rose 8.1 percent, hitting $8.9 billion, compared with $8.3 billion in 2001. The increase was due primarily to continued subscriber growth of DirecTV in the United States. EBITDA for the 12 months reached $672.4 million, up from $389.9 million in the same period the previous year.
Operating loss for the 12 months hit $394.7 million, down from an operating loss of $757.8 million in 2001. Net loss for the 12 months totaled $891.1 million, up from a net loss of $621.6 million in 2001, primarily due to charges and increased interest expense.
Looking ahead, Hughes revenue for the first quarter of 2003 should be about $2.1 billion, with full-year revenue ranging from $9.3 billion to $9.5 billion. EBITDA for Hughes' first quarter should range from $175 million to $225 million, and be about $1.1 billion for all of 2003.
DirecTV U.S. anticipates first quarter 2003 revenue of about $1.6 billion, with the satellite service registering about $7.1 billion for the upcoming 12 months. EBITDA is expected at about $160 million for the first quarter and $800 million to $850 million for the year. Net subscriber adds for DirecTV for all of 2003 should range from 750,000 to 800,000.