SKT Sky Network Television Limited.

[winner69]

Doesn’t make much of a return on equity or invested capital
L.

No wonder share price is where it is

[Ogg]

Doesn’t make much of a return on equity or invested capital
L.

No wonder share price is where it is

Do you want to take this one mista or shall I?

[Ogg]

Doesn’t make much of a return on equity or invested capital
L.

No wonder share price is where it is

ROE ins't an appropriate valuation metric given the recent write down of goodwill and the large equity placement. The EOY accounts should provide a better picture. However, you need to take into account there are two businesses. A mature satellite business and a growing streaming business. Both of these are being reported together, giving you a mixed result, so you need to be careful when reading the numbers.

What you're really saying is how profitable is Sky?

• The satellite business was once very profitable is now just somewhat profitable.

• The streaming business is currently not very profitable but over time it maybe very profitable.

As a user above suggested, it maybe appropriate at some stage to either divest or separate the two businesses out, making it easier for investors to calculate an appropriate valuation. A more likely outcome is that a merger or takeover will happen and the two businesses will be broken out into subsidiaries.

At the end of the day, it's always hard to evaluate any "weightless" business. It would be great if we could count how many "railroad carts, factories, and arable hectares" the business had. The one asset that Sky does have, is it's market position in New Zealand, which remarkably, over the many years has been shaken, but remains intact. This asset will likely continue to give a favorable return to shareholders over the long term and thus provide a good ROE.

[Leftfield]

ROE ins't an appropriate valuation metric .....
What you're really saying is how profitable is Sky....
....This asset will likely continue to give a favorable return to shareholders over the long term and thus provide a good ROE.

Can you please provide evidence to support what your 'continued favourable return to shareholders' has been (say) over the last 5 years?

Just curious. Thanks.

[winner69]

Thanks Ogg ...You make it sound like it’s going be years before any decent profit (or ROE). If F20 $20m to $25m and F21 indicative $5m to $15m is any indication then it’s probably F24 before anything decent (hopefully)

[Snow Leopard]

...Glad you answered instead of that loser mate of yours ....seems he’s a few fries short of a Happy Meal

[Dlownz]

Subscriber satellite numbers as at April 30 were 586000 and streaming was 415000
Streaming doesn't break down the seperation between sky sport and neon.
What will be interesting to see is how many people stay with neon now they have to pay for it. Sky had only lost a satellite base of 1% during covid which is very low concidering but have gained streaming customers. What would be good to see with the result in August will be holding onto streaming customers or even increasing the base But going from free to $10 with spark will be a test.
So off simple calculations.
Satellite rev is $576mil
Streaming based off $10 a month is 50mill
Is that right?
Also in the pipeline is 80-90 mil in savings.
Get this conversation off the mud slinging. Let's leave that to the politicians.
Talk numbers and estimates. 😊

[Ogg]

Can you please provide evidence to support what your 'continued favourable return to shareholders' has been (say) over the last 5 years?

Just curious. Thanks.

It's always been a cash cow. Millions in dividends were paid out. It provided a favourable return after the GFC when finance companies and term deposits fell out of favour. Ma and Pa investors poured millions into the company as they trusted the name and liked the regular dividend payments. As a result the valuation became stretched.

The problem is that the company took on debt to invest in the business while at the same time paid out earnings. During this time new technology and competitors entered the market. The long term outlook changed and the current equity holders were wiped out.

The company has since been recapitalised and enough time has past that the long term outlook is more clear. The doomsday Blockbuster scenario can be ruled out. Sky is still relevant. The question is what valuation should be placed on it. Some say zero, the market says $230m, I say about $550m, others say more, Infratil or Comcast maybe even more than that. That's what I like about this stock, the unknown.

[Vince]

Do you want to take this one mista or shall I?

It's okay, - I've got this....... see you in a week!

[Beagle]

When its all said and done the shares continue their downtrend and from a technical perspective I think a test of their all time low of 12.5 cps looks likely.

I struggle to see what the catalyst is for a breakout of their current downtrend ? They've raised a bunch of capital at 12.0 cents...simple logic suggests to me that's where this is headed in the short term. Shareholders just as disenfranchised as subscribers ?