Sky Network Television Ltd [NZX:SKT] has fallen by over 7% in trading today, down to $1.14 at the time of writing.
Sky — founded in 1987 — is New Zealand’s largest pay-per-view satellite TV provider. A popular presence in many Kiwi households, the company is well-known for its sporting coverage, as well as its movie and documentary offerings.
Sky currently has market cap of $472 million.
Why has the [NZX:SKT] share price plunged?
The company’s announcement today was overwhelmingly negative.
Sky posted a net loss of $608 million for the financial year, and to add to the sour news, it also declared that dividends would be suspended effective immediately.
This created a bearish mood that immediately led to a sharp sell-off of Sky shares.
Where could Sky Network Television go from here?
There is a pervasive feeling of grimness among analysts.
Sky has lost over 40,000 subscribers in the past 12 months, a trend that has been accelerated by fierce competition from other streaming services offered by Spark [NZX:SPK] and Netflix.
However, Sky management is stubbornly digging in its heels. It is attempting to bolster its sports overage by purchasing Irish company RugbyPass, billed as the world’s largest rugby streaming service.
This is an attempt by Sky to expand into the international market, even as its fortunes in New Zealand start to flag.
For the foreseeable future, the share sentiment for Sky remains negative and will likely continue to track on a downward trend.