Japan's biggest cable TV company, Jupiter Telecommunications Co Ltd, said on Thursday it aims to increase its sales by 15 percent as it also expands its customer base by 10 to 15 percent each year through 2008. Jupiter, which made its stock market debut on Wednesday, also expects its EBITDA (earnings before interest, taxes, depreciation and amortisation) margin to exceed 40 percent in 2005, up from 39.1 percent in 2004.
"We want to keep a margin of at least 40 percent in the future," Tomoyuki Moriizumi, president and chief executive of Jupiter, told Reuters in an interview.
Jupiter, better known as J-Com, has forecast a group net profit of 14 billion yen ($132.2 million) for the current business year to December 31, up 29 percent from last year's estimated 10.8 billion yen.
It expects sales to reach 185 billion yen, up 15 percent.
The company, which offers television, Internet and telephone services over its cable network, had 1.9 million customers as of December, up 7 percent from a year earlier.
Of that, its cable television subscribers numbered 1.6 million, giving it about one-third of the Japanese market.
The company was originally 65 percent-owned by a venture set up by US cable TV magnate John Malone's Liberty Media International Inc , but the venture's holdings dropped to 54 percent as the company issued more shares ahead of its initial public offering on Wednesday.
The flotation on Japan's Jasdaq securities exchange for start-ups was worth about $992 million, the biggest offer in Japan so far this year.
Moriizumi said the company planned to acquire more regional cable TV operators and offer additional services such as home security and mobile telephony through partnerships as well as new content such as television shopping.
He also said that its plans to convert completely to a digital network by 2008 and offer a combination of television and communication services would drive growth.
"When you add services, fewer customers leave and average spending per customer rises," said Moriizumi, adding that he aimed to increase average monthly revenue per customer to about 8,000 yen in three years from 7,090 yen at the end of 2004. Moriizumi also said Jupiter would increase its capital spending to about 50 billion yen this year from roughly 45 billion yen in 2004.
Industry-wide, only about one-third of Japanese households subscribe to cable television services, compared with more than twice that in the United States.
The company also faces tough competition from satellite broadcasters such as Sky Perfect Communications Inc.
The cable industry is considered to have long-term potential because it has the ability to compete with traditional telephone companies, offering Internet connections and Internet telephony in addition to broadcast services.
In the United States, cable companies pose strong competition for local phone firms because they can pull their own cable lines directly to homes instead of relying on the local operators to provide the last bit of connection.
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