Cox posts loss

Thursday, Feb. 12, 2004 | 11:01 a.m.

SUN STAFF AND WIRE REPORTS

ATLANTA -- Cox Communications Inc., the fourth-largest U.S. cable television company, today reported a fourth-quarter loss of $11.3 million as it spent more for programming and on marketing aimed at convincing subscribers to sign up for new services.

The net loss of 2 cents a share compared with profit of $179.6 million, or 28 cents, a year earlier, the Atlanta-based company said in a statement. Revenue rose 12 percent to $1.51 billion from $1.34 billion.

Chief Executive Jim Robbins increased marketing expenses by 13 percent as Cox added more digital cable, high-speed Internet and telephone customers. The company ended the year with roughly 6.3 million basic-cable subscribers, about the same as it had in September, and said it expects that number to grow by less than 1 percent in 2004.

Cable operators have been looking for new sources of growth as competition intensifies with satellite-TV providers such as Hughes Electronics Corp.'s DirecTV. Comcast Corp., the biggest cable provider, Wednesday offered $54.1 billion for Walt Disney Co. in a bid to get more entertainment programming to offer on its systems.

Cox said it expects sales this year to rise as much as 12.5 percent, with capital spending ranging from $1.35 billion to $1.4 billion.

Cox, which also offers voice and data communication services to businesses, said revenue from data services surged 40 percent to $238.8 million.

Video revenue rose 5.7 percent to $933.3 million as the company continued to roll out new video services such as high-definition and on-demand channels as well as a digital video recorder service.

But programming costs increased 9 percent, reflecting rate increases and customer growth, and overhead costs rose 16 percent.

Cox blamed the increases on the expense of trials of new video and telephone products, as well as higher labor, public relations and marketing expenses.

Shares of Cox fell 12 cents to $33.91 at 9:35 a.m. in New York Stock Exchange composite trading this morning. They had risen 25 percent in the past year through Wednesday.

Besides Comcast, Time Warner Cable and Charter Communications Inc. are the cable operators with more subscribers than Cox.

The Greenspun family, owner of the Las Vegas Sun, is a minority investor in Cox's Las Vegas system.