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Sky (LON:SKY) fought back in its battle with arch-rival BT (LON:BT.) on the back of customer wins and stabilisation in parts of its European business.
The satellite broadcaster took a hit from BT's success in securing exclusive rights to the entire Champions League and Europa League this season, but it said 973,000 customers had signed up to its services in the year to June 30, 45% up on a year ago.
It passed the 12 million customer mark in the UK with the highest growth in 11 years.
The group, which has bought Sky Italia and Sky Deutschland, achieved record customer growth in Germany and Austria.
The Italian business held customer numbers stable after three years of declines.
Adjusted pre-tax profit rose 6% to nearly £2bn on a 5% increase in revenue to £11.3bn.
It emphasised its wins in TV sports rights in the UK, where it is facing an attack as BT uses sport to drive its broadband business.
It has secured an exclusive deal to cover the world’s oldest golf tournament, the Open, meaning live coverage of the tournament will no longer be free-to-air in the UK.
BT has hit back by urging regulator Ofcom to crack down on what it described as Sky's dominance in the pay-TV market.
It says Sky has a 64% share of the pay TV market, which it said was keeping prices high and hitting competition.
Sky’s chief executive Jeremy Darroch said it is winning more customers by investing in new programmes and doing deals with other TV providers to broadcast its output.
"We see an expanded opportunity for growth by serving the market broadly with multiple products and services," he said.
Wealth management firm Killik said the results were better than the market had been expecting, with a good performance in Germany and tight cost controls benefiting the company.
“There was no great change to outlook from the company though management did note there was an ‘expanded opportunity for growth’,” Killik noted.
Broker Investec, meanwhile, said it was unlikely to change its forecasts for the current financial year, which are more or less in line with the market consensus.
It reckons those consensus estimates will probably hold for 2016 but next year’s forecasts may ease a little “given Germany’s costs”.
It retains its ‘reduce’ recommendation, given increasing competitive pressures in a consolidating European market, while it expects cost pressures will continue to be a drag on share price performance.
On the other hand, the possibility of a bid from Rupert Murdoch’s Fox organisation gives some upside, as does the chance of a positive outcome (from Sky’s perspective) in industry watchdog Ofcom’s ruling on BT’s Openreach division.
Shares in Sky were virtually unchanged in afternoon trading at 1,125p after hitting 1,180p in the morning session. BT shares gained 6.95p at 472.55p.