Friday, July 11, 2008

XM Canada spring-quarter net loss deepens to $18.8M on revenue of $10.3M

TORONTO — Despite plenty of red ink on its books, Canadian Satellite Holdings Inc. (TSX:XSR), the parent company of XM Canada, foresees increasing amounts of cash will flow into its coffers in future quarters, CEO Michael Moskowitz said Thursday.

He was commenting after the satellite broadcaster's third quarter results showed it achieved its first ever quarter of positive cash flow - when cash from operations is greater than cash spent - since the company launched about three years ago.

CSR held $4.4 million in cash at May 31, $300,000 more than at the beginning of the quarter. The adjusted operating loss also improved to $7.1 million from $9.8 million.

"This quarter we achieved a very significant milestone," said Moskowitz. "For the first time in our short history as a public company, we generated positive cash flow ... ahead of plan" as well.

"We believe that you will see many more quarters like this in the future as the subscriber base grows," he told a conference call following release of the company's quarter results.

He also said "our key performance metrics improved significantly as we continue to grow our subscriber base, expand our gross margin, reduce our fixed-cost base and effectively manage our subscriber acquisition costs."

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