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News Corp earnings beat projections

Source : BUSINESS_STANDARD
Last Updated: Wed, Nov 07, 2012 21:40 hrs

Rupert Murdoch's News Corp reported quarterly profit on Tuesday that beat analyst expectations, helped by growth at cable television networks such as Fox News Channel and FX. Its shares jumped 2.4 per cent after hours. The media company that owns Fox Broadcasting and The Wall Street Journal said adjusted earnings per share reached

43 cents for the quarter that ended in September on profit of $1.0 billion (£625.6 million). Analysts on average had expected 37 cents, according to Thomson Reuters I/B/E/S.

Adjusted earnings did not account for a $1.4 billion gain from the July sale of a 49 per cent stake in TV software developer NDS Group to Cisco Systems. Unadjusted earnings totalled 94 cents per share for the quarter.

At News Corp cable networks, operating income rose 23 per cent to $953 million, lifted by growth at regional sports networks, the FX cable network and Fox News Channel.

News Corp Chief Operating Officer Chase Carey gave a cautious outlook for ad spending at the company's television networks.

He said the London Olympics on NBC grabbed a large share of third-quarter ad spending and the fourth quarter of 2012 will be "a bit better" for the company.

"I think you've got a market that is pretty reserved and pretty cautious," Carey told Wall Street analysts on a conference call. "I think markets overall are OK, not great."

Carey acknowledged a slow start to the fall television season at broadcast TV network Fox.

"Fall entertainment launches have been below our expectations," he said, adding that the quick, four-game World Series, the lowest rated on record, was "clearly not what we had hoped for."

Revenue for the just-ended quarter was $8.1 billion, a 2 per cent increase from a year earlier.

The television unit that includes Fox Broadcasting saw operating income gain 17 per cent to $156 million.

Operating income at the company's movie unit, which released animated mega-hit "Ice Age: Continental Drift," rose 15 percent from a year earlier to $400 million.

News Corp said it took a $67 million charge in the quarter for costs related to ongoing investigations into a telephone hacking scandal at British tabloid News of the World, which the company has closed.

In June, News Corp said it would separate its publishing and entertainment assets by next year in a move to satisfy shareholders pressing the company to shed its troubled newspapers business. Executives spoke little about the coming split on the earnings call, promising more details by year end.

For the fiscal first quarter, the publishing business that includes British and US newspapers reported a 48 per cent drop in operating income to $57 million due to lower advertising revenue.

Satellite broadcaster Sky Italia suffered from higher programming expenses and a strengthened US dollar, News Corp said. The service's operating income plunged 81 per cent to $23 million.

News Corp shares rose in after-hours trading to $24.85, up 2.4 per cent from their close on Nasdaq of $24.28.




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