Exhibit 99.1
[SIRIUS LOGO]
SIRIUS MORE THAN DOUBLES SUBCRIBERS IN FIRST QUARTER 2003
o SUBSCRIBERS UP 127% OVER LAST YEAR
o BRAND AWARENESS DOUBLES SINCE BEGINNING OF YEAR
o "PREFERRED PLAN" OF $6.99 FOR ADDITIONAL SUBSCRIPTIONS OFFERED
o "LIFETIME OF MUSIC & MORE PLAN" INTRODUCED AT $399.99
o FINANCIAL RECAPITALIZATION CLOSED RESULTING IN IMPROVED BALANCE SHEET
AND LIQUIDITY
o COMPANY RELEASES FIRST QUARTER 2003 FINANCIAL RESULTS
NEW YORK, NY -- May 14, 2003 -- SIRIUS (NASDAQ: SIRI), the premier satellite
radio broadcaster and only service delivering uncompromised coast-to-coast music
and entertainment for your car and home, today announced that it more than
doubled its subscribers in the first quarter of this year to approximately
68,000, meeting an important target for the second company to offer nationwide
satellite radio service. The substantial growth in subscribers represents a 127
percent increase over its end-of-year 2002 figure.
"These excellent subscriber results indicate that we are beginning to see some
traction in the marketplace," said Joseph P. Clayton, President and CEO of
SIRIUS Satellite Radio. "With the introduction of our transportable `Plug &
Play' products from Kenwood and Audiovox hitting retail shelves this summer, we
fully expect to exceed 100,000 subscribers this quarter, and reach our goal of
over 300,000 subscribers by the end of the year."
SIRIUS also indicated that its brand awareness more than doubled since the
beginning of the company's first brand advertising campaign in February of this
year. These results were based on a category brand monitoring study conducted by
Diagnostic Research and commissioned by SIRIUS.
With more subscribers signing up every day, SIRIUS is introducing a "Preferred
Plan" for multiple subscriptions and a "Lifetime of Music & More Plan." On the
"Preferred Plan," once a subscriber pays the initial subscription rate of
$12.95, an additional subscription for that subscriber will cost only $6.99. On
the "Lifetime of Music & More Plan," SIRIUS will charge a one-time fee of
$399.99 that will cover the life of the satellite radio unit purchased.
SIRIUS also announced its financial results for the quarter ended March 31,
2003. SIRIUS launched its service nationwide on July 1, 2002, and had 68,059
subscribers on March 31,
2003. In addition, on March 7, 2003, SIRIUS closed a $1.2 billion
recapitalization, which eliminated approximately 91% of the company's debt and
100% of its convertible preferred stock, and raised $200 million of new equity.
SIRIUS currently has funds to cover estimated funding needs into the second
quarter of 2004.
FIRST QUARTER 2003 VERSUS FIRST QUARTER 2002
For the first quarter of 2003 SIRIUS recognized total revenue of $1.6 million,
compared to $33 thousand for the first quarter of 2002. SIRIUS reported a loss
from operations of $(99.1) million for the first quarter of 2003, compared to a
loss from operations of $(50.8) million for the first quarter of 2002. Adjusted
EBITDA loss for the first quarter of 2003 was $(75.0) million, compared with
$(36.2) million in the first quarter of 2002. Adjusted EBITDA loss for the first
quarter of 2003 excludes a $256.5 million gain in connection with the
elimination of approximately 91% of the company's debt.
SIRIUS reported net income applicable to common stockholders of $51.9 million,
or $0.16 per share, for the first quarter of 2003, compared with a net loss
applicable to common stockholders of $(90.1) million, or $(1.22) per share, for
the first quarter of 2002. Included in net income applicable to common
stockholders for the first quarter of 2003 was a $256.5 million gain in
connection with the elimination of approximately 91% of the company's debt and a
deemed dividend of $79.5 million associated with the elimination of 100% of its
convertible preferred stock.
For the quarter ended March 31, 2003, average monthly revenue per subscriber, or
ARPU, was approximately $10.94, including the effect of mail-in rebates.
(Selected Balance Sheet Data and Statement of Operations follow).
SIRIUS defines Adjusted EBITDA loss as net loss before interest and investment
income, interest expense, depreciation expense and debt restructuring. Our
definition of Adjusted EBITDA may not be comparable to similarly titled measures
of other companies in our industry. Adjusted EBITDA is not a measure of
financial performance under accounting principles generally accepted in the
United States. We have raised and invested large amounts of capital to fund the
completion of our system; as a result, our results of operations include
significant charges for depreciation and interest expense. In addition, we have
recognized a gain associated with the restructuring of our debt. Adjusted
EBITDA, which excludes these items, provides a basis to measure our operating
performance, apart from the expenses associated with our physical plant or
capital structure. Adjusted EBITDA should not be considered in isolation or as a
substitute for operating loss, cash flow from operating activities or other
measures of performance defined by accounting principles generally accepted in
the United States. A reconciliation of Adjusted EBITDA loss is presented on the
attachment.
SIRIUS defines average monthly revenue per subscriber ("ARPU") as the total
earned subscription revenue and activation revenue over the daily weighted
average number of subscribers for the period. ARPU is not a measure of financial
performance under accounting principles generally accepted in the United States
and should not be
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considered in isolation or as a substitute for measures of performance prepared
in accordance with accounting principles generally accepted in the United
States.
SIRIUS Satellite Radio Inc.
Financial Highlights
(In thousands, except per share and subscriber data)
(Unaudited)
For the Quarter Ended
March 31,
---------------------
2003 2002
--------- --------
Statement of Operations:
Subscriber revenue, net of rebates $ 1,554 $ 4
Advertising revenue, net of agency fees 17 29
Other revenue 20 --
--------- --------
Total revenue 1,591 33
--------- --------
Operating expenses:
Cost of services:
Satellite and transmission 7,867 8,757
Programming and content 6,574 3,783
Customer service and billing 2,202 1,842
Sales and marketing 45,340 15,659
General and administrative 9,094 7,540
Research and development 4,983 7,713
Depreciation expense 24,100 14,481
Non-cash stock compensation 559 (9,024)
--------- --------
Total operating expenses 100,719 50,751
--------- --------
Loss from operations (99,128) (50,718)
Other income (expense):
Debt restructuring 256,538 --
Interest and investment income 1,343 2,000
Interest expense (18,665) (30,193)
--------- --------
Total other expense 239,216 (28,193)
Net income (loss) 140,088 (78,911)
Preferred stock dividends (8,574) (11,042)
Preferred stock deemed dividends (79,634) (171)
--------- --------
Net income (loss) applicable to common stockholders $ 51,880 $(90,124)
========= ========
Net income (loss) per share applicable to common
stockholders:
Basic $ 0.16 $ (1.22)
========= ========
Diluted $ 0.16 $ (1.22)
========= ========
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Weighted average common shares outstanding:
Basic 327,785 73,861
Diluted 327,872 73,861
Reconciliation of net income (loss) to Adjusted EBITDA:
Net income (loss) as reported 140,088 (78,911)
Add back non-EBITDA items included in net loss:
Depreciation expense 24,100 14,481
Interest and investment income (1,343) (2,000)
Interest expense 18,665 30,193
Debt restructuring (256,538) --
--------- --------
Adjusted EBITDA $ (75,028) $(36,237)
--------- --------
March 31, December 31,
2003 2002
---------- ------------
Select Balance Sheet Data:
Cash, cash equivalents and marketable securities $ 289,742 $ 173,702
Restricted investments 7,200 7,200
Working capital 263,268 151,289
Total assets 1,420,985 1,340,940
Long-term debt, net of current portion 58,205 670,357
Accrued interest, net of current portion -- 46,914
Total liabilities 117,744 772,941
Convertible preferred stock -- 531,153
Accumulated deficit (787,391) (927,479)
Stockholders' equity 1,303,241 36,846
Other Data:
Subscribers (end of period) 68,059 412
About SIRIUS
SIRIUS is the only satellite radio service bringing listeners more than 100
streams of the best music and entertainment coast-to-coast. SIRIUS offers 60
music streams with no commercials, along with over 40 world-class sports, news
and entertainment streams for a monthly subscription fee of only $12.95, with
greater savings for upfront payments of multiple months or a year or more.
Stream Jockeys create and deliver uncompromised music in virtually every genre
to our listeners 24 hours a day. Satellite radio products bringing SIRIUS to
listeners in the car, truck, home, RV and boat are manufactured by Kenwood,
Panasonic, Clarion and Audiovox, and are available at major retailers including
Circuit City, Best Buy, Car Toys, Good Guys, Tweeter, Ultimate Electronics,
Sears and Crutchfield. SIRIUS is the leading OEM satellite radio provider, with
exclusive partnerships with DaimlerChrysler, Ford and BMW. Automotive brands
currently offering SIRIUS radios in select new car models include BMW, MINI,
Chrysler, Dodge, Jeep'r', Nissan, Infiniti and Mazda. Automotive brands that
have announced plans to offer SIRIUS in select models include Ford, Lincoln,
Mercury, Mercedes-Benz, Jaguar, Volvo, Audi, Volkswagen, Land Rover and Aston
Martin.
Click on www.SIRIUS.com to listen to SIRIUS live, or to find a SIRIUS retailer
or car dealer in your area.
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Any statements that express, or involve discussions as to, expectations,
beliefs, plans, objectives, assumptions, future events or performance with
respect to SIRIUS Satellite Radio Inc. are not historical facts and may be
forward-looking and, accordingly, such statements involve estimates, assumptions
and uncertainties which could cause actual results to differ materially from
those expressed in any forward-looking statements. Accordingly, any such
statements are qualified in their entirety by reference to the factors discussed
in our Annual Report on Form 10-K for the year ended December 31, 2002 filed
with the Securities and Exchange Commission. Among the key factors that have a
direct bearing on our results of operations are: our need for substantial
additional funds before the second quarter of 2004; our dependence upon third
parties to manufacture, distribute, market and sell SIRIUS radios and components
for those radios; the unproven market for our service; our competitive position
and any events which affect the useful life of our satellites.
Contacts:
SIRIUS
Jim Collins Cheryl Cramer
Media and Investor Relations Investor Relations
212-901-6422 212-901-6466
jcollins@SIRIUSradio.com ccramer@SIRIUSradio.com
Thomas Meyer
Media Relations
310-578-0425
Thomas.meyer@pr21.com
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