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Sky increased revenues by 10% to £4.551 billion in the year ending June 30, the company reported on Friday.

Operating profit was £815 million, down from £877 million the previous year because of the investment in the launch of its Sky Broadband service, which now has more than 700,000 customers.

Annual net customer additions over the 12 months were 406,000, taking the total customer base to 8.582 million. The level of growth will need to increase further if the company is to meet its target of 10 million customers by 2010.

Elsewhere, it proposed an increase in its dividend by 27% to 15.5p. "The team has delivered a strong financial performance whilst building the foundations for future growth," said chief exec James Murdoch. "Continued successful execution of our strategy gives us confidence that we are well placed to capitalise on the significant opportunities available to us, and the proposed 27% increase in the full year dividend is a mark of that confidence."