UPDATE 2-Cablevision beats expectations, shares jump

NEW YORK, Nov 3 (Reuters) - New York cable operator Cablevision Systems Corp posted better-than-expected quarterly profit, fueled by increases in Internet and phone subscribers and advertising revenue. Shares of the company, which will spin off its Madison Square Garden unit by the end of the year, rose more than 5 percent after it said its profit rose to $98.9 million, or 33 cents a share. Last year it earned $30.9 million, or 11 cents per share. Analysts on average had been expecting profit of 26 cents a share on revenue of $1.82 billion, according to according to Thomson Reuters I/B/E/S. Revenue grew 5.3 percent to $1.84 billion also beating Wall Street estimates. Cablevision Chief Executive James Dolan said the company is "moving forward" with its planned spin-off of the Madison Square Garden business, and expects to get the deal done by the end of this year. The Dolan family hopes to get a better valuation from Wall Street for assets including the New York Knicks basketball team and Radio City Music Hall.

Some analysts have valued MSG at between $1.5 billion to $2 billion as a stand-alone business plus debt. Under the new structure, the Dolans would continue to hold a controlling stake in MSG, which also owns the namesake arena and New York Rangers hockey team. James Dolan will become executive chairman of the new public company and continue as CEO of Cablevision. Cablevision founder Charles Dolan will continue as Cablevision chairman. During the third quarter, Cablevision, which faces fierce competition from Verizon Communication's FiOS TV digital service, lost 27,300 basic video subscribers which was more than some analysts had expected. The company's digital customers were up 2.6 percent, compared with a year ago. Compared with the second quarter, it lost 14,300 digital subscribers. Cablevision said its average monthly revenue rose to $141.03 from $139.69 in the second quarter and $133.11 one year ago. Cablevision shares rose 5.4 percent to $24.53 in early trade on the New York Stock Exchange (Reporting by Franklin Paul, editing by Dave Zimmerman) (To read more about our Media news, visit out MediaFile blog online at http://blogs.reuters.com/mediafile ) Keywords: CABLEVISION/ (Email: [e-mail]; [phone]; Reuters Messaging: [e-mail]) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved.

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