The ratings on Virgin Media Inc. (VMI) are constrained by the fierce competitive landscape in the U.K. market; a still highly leveraged--albeit improving--capital structure; and reliance on a competitor for some key TV content. The ratings benefit, however, from VMI's well-established business position as the second-largest pay-TV operator in the U.K., with a two-way cable network passing one-half of the households in the U.K. and strong network capabilities to provide customers with innovative and faster broadband offerings; and continuing positive free operating cash flow (FOCF) generation. VMI's third-quarter 2008 revenue of £991 million was lower than the £1,006 million in the same period last year, reflecting reduced mobile and business revenues, partially offset by growth in consumer and content revenues.
