After Scaling Down Staff, Sirius Forecasts '09 Profit

Sirius XM Radio said yesterday that it will have trimmed 22 percent of its workforce, or 458 people, by year-end, and it reaffirmed its forecast that it will post its first-ever adjusted profit next year.

The New York-based satellite radio provider will have 1,600 workers, down from the 2,058 it employed before its July acquisition of XM Satellite Radio Holdings of the District. Sirius chief executive Mel Karmazin made the announcement at the firm's annual shareholders meeting, according to a filing with the Securities and Exchange Commission.

The company forecast a smaller-than-expected adjusted loss before interest, taxes, depreciation and amortization of $200 million this year, down from the previous forecast of $300 million.

Sirius expects the job cuts and other cost-reduction measures to save $425 million next year.

For 2009, Sirius reaffirmed its expectation for adjusted profit of $300 million. But the number of subscriptions to its service, many sold through cars with its radios preinstalled, is forecast to rise to just 20.6 million -- below the 21.5 million Sirius forecast in September, before the Detroit automakers asked Congress for emergency loans. Karmazin noted that November automobile sales in the United States fell 37 percent, the weakest results in nearly three decades.

Sirius also reaffirmed revenue forecasts of $2.4 billion this year and $2.7 billion in 2009.

The company said $995 million of debt is due next year. It is talking with debt holders as well as new investors in an effort to ease its repayment schedule.

Also at yesterday's meeting, shareholders approved a reverse stock split to boost Sirius's share price. Shares closed at 14 cents yesterday, well off from $3.22 a year ago. Sirius said its shares must trade at $1 or higher to continue listing on the Nasdaq Stock Market.