News Corp Fiscal Q2 Earnings Top Wall Street Expectations
The company’s cable networks led the way in a quarter that included $56M in costs related to the UK hacking scandals — down from $87M in the period last year. News Corp generated net income of $2.46B, +118.1% vs the last three months of 2011, on revenues of $9.43B, +5.0%. The revenue number beat forecasts for $9.27B. And adjusted earnings, at 44 cents a share, exceeded expectations by two cents. The Cable Network Programming unit delivered operating income of $945M, +7%, wirh $2.56B in revenues, +18%. Domestic affiliate revenue was up 13% and ad sales were up 8%. That had to offset a 26% rise in programming expenses, largely for sports rights. Filmed Entertainment had a different story with operating income -2.5% to $383M on revenues of $2.07B, +1.9%. The company notes that last year benefited from home videos of Rio, Rise Of The Planet Of The Apes and X-Men: First Class. In Television the company enjoyed seeing retransmission consent revenues double, and an influx of cash from political campaigns – but also grappled with Fox’ lower prime time ratings, and a World Series of just four games (vs. seven last year) as the San Francisco Giants swept the Detroit Tigers. Operating income was up 18.5% to $224M on revenues of $1.53B, +7.9%. The Publishing unit was up, partly due to the launch in early 2012 of a Sunday edition in the UK of The Sun. Operating income rose 7.3% to $234M on revenues of $2.15B, +8.9%.
Related: News Corp Exec Calls Sports Network Plans “The World’s Worst Kept Secret”
News Corp says it spent $23M to prepare for the separation of the entertainment and publishing businesses. It also reported a $65M impairment charge for the newspaper business. The company’s strategies bolstered its “competitive position and enhance our ability to benefit from global demand for content, especially sports programming,” CEO Rupert Murdoch says.
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