SIRIUS XM Radio Inc. (NASDAQ: SIRI) has just reported its first real earnings report since its full merger completions.  The satellite radio giant posted results which it only included in the conference call rather than in a press release.  About 12 minutes into the conference call we started seeing numbers come across newswires with additional data and some different figures, so you will need to compare results on your own.  That practice is not normal should not at all be accepted as fair or normal in today’s world.

In the conference call, the company said that Pro Forma is without many costs associated with earnings with revenues gaining 16.5% to $613 million, adjusted loss excluding costs was -$9 million.  Be advised that these were taken from the audio conference and appear different than the first headlines we saw from newswires.

Mel Karmazin did note in the conference call that it is very hard to talk positively about anything because of where the stock price is, but he wanted to discuss the positives and discuss how well this is compared to how the economy and where auto sales are.  He is still talking positive EBITDA in 2009 and now sees a smaller EBITA loss for 2008.  In 2009 it will have over $300 million in EBITDA and will not have a net cash outflow for the full year of 2009 (and will continue that beyond).

We did not put much faith in the First Call numbers of -$0.09 EPS and $587.4 million in revenues because analysts have lost coverage, have not made proper updates, and have not counted in all of the numbers from the merger. 

In fact, this last quarter still is not a true representation of thecompany on a fully combined basis.  The bad news is that when thenumbers are fully comparable, the economy will have come down to acrawl.

Will Mel take it private or will the shareholder suit win over the company?  Either way, stock de-listing issues and refinancing issues lie around the corner.

I have analyzed companies in the same manner for over a decade and this order of starting a conference call without the press release has happened so few times. 

Jon C. Ogg 
November 10, 2008

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