SIRIUS First Post-XM Merger Earnings On Deck (SIRI)

On Thursday morning, we’ll get our first real earnings conference call out of Sirius Satellite Radio, Inc. (NASDAQ: SIRI) on a post-XM merger basis.  Last week we got some of the preliminary data but here are some of the numbers that we are looking for…. 

SIRIUS gave preliminary revenues of $283 million and said it had 8.924million subscribers.  XM finished with 9.7 million subscribers at itslast earnings report a couple weeks ago.  Operating expenses, excludingdepreciation and stock based compensation, are expected to remainapproximately flat in the second quarter 2008 as compared to the secondquarter 2007. Second quarter 2008 adjusted loss from operations isexpected to be approximately $24 million, an improvement of 70% fromthe adjusted loss from operations of $79 million in the second quarter2007.

Mel Karmazin gave two interviews recently which offer much moreinsight.  Here is his interview given to FOX BUSINESS NEWS where hecame out positive after buying 2 million shares of common stock.  Hereis his interview on CNBC where Karmazin seemed flat and a littlefleeting to David Faber’s questions.

SIRIUS issued a statement upon the merger closing showing a combinedsubscriber base of 18.5 million and an "annualized" Q2 revenue of over$2.4 Billion.  SIRIUS also reaffirmed its targets, and said it sees2009 synergies of $400 million and 2009 adjusted EBITDA of over $300million. The company is also looking for free cash flow positivenumbers for all of 2009, but it did stipulate that it was beforesatellite capital expenditures.

As far as everything else, what we’d really like to see is a fullyconsolidated page of its total debt refinancings it has just completedand what is still in need to be completed now that it has made so many filings showing various terms.  As this will create thedilution analysis and financial leverage analysis for the months and years ahead, that is going to befar more important than any formal numbers the company gave for itslast quarter.

Jon C. Ogg
August 6, 2008