Virgin reports increased ad revenue, but writes down £366m on mobile

LONDON - Virgin Media TV reported a 10.6% year-on-year lift in ad revenue for the three months to 30 June, helping to lift overall revenues for the TV operation by 9.3%, to £28.3m.

In the second quarter, Virgin Media added 24,800 net TV subscribers, compared to just 2,200 net additions in the same period of 2007 - a time when Virgin Media's appeal had been hit by the removal of Sky's basic channels from its platform following a dispute over the price.

Virgin Media chief executive Neil Berkett said: "We will continue to exploit our competitive advantages in leading next-generation broadband in the UK and redefining the on-demand TV experience."

On a monthly basis, 1.6 million of Virgin's TV customers are using its VoD services, representing a reach of 48%. Average views per user per month in the quarter were 24, compared to 14 a year ago. Average monthly views were 38 million in the quarter, up 5% on the previous quarter and up 92% on the same quarter in 2007.

Virgin Media was the first TV platform to launch the BBC iPlayer on its platform, which achieved 10.5 million views in June. The broadcaster is also developing its long-form ad platform Showcase, with sales house IDS signing up Disney Destinations International to produce a series of 10-minute Disney Travel on-demand programmes available to viewers any time.

During the quarter, Virgin added 60,700 V+ DVR (Digital Video Recorder) subscribers to take the total to 424,900 -13% of Virgin Media's digital subscriber base of 3.4 million.

Overall, Virgin Media reported revenues of £990.5m for the quarter, compared to £995m the previous year. The company was hit by an operating loss of £333m, including a £366m write-down for its mobile segment.

Virgin Media said that having conducted a valuation of the mobile business, it concluded the declining valuations of comparable mobile companies meant it needed to make the write-down.

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