Cable drives News Corp to billion dollar quarterly profits
Joseph O'Halloran ©RapidTVNews | 10-05-2012
He may be on the ropes following revelations about the business practices at his firm, but in financial terms Rupert Murdoch can take pride in News Corp over its last quarter driven by double-digit growth at the company’s cable network.
For the three-month period ended 31 March 2012, the 800lb media gorilla reported third quarter revenue of $8.40 billion, a 2% year-on-year increase over the $8.26 billion revenue reported a year ago. Revenues were given a kick by the aforementioned cable business plus the filmed entertainment segments, but were, said the company, partially offset by declines primarily at the TV segment due to the absence of revenues generated from the broadcast of the National Football League Super Bowl in the prior year.
All of this contributed to third quarter total segment operating income of $1.31 billion, a 23% increase over that posted a year ago. This improvement was led by a $111 million (15%) increase at the Cable Network Programming segment. Making the performance better was the fact that the current quarter results included a $63 million hit related to the ongoing investigations initiated upon the closure of The News of the World due to the hacking scandal which has dogged Murdoch and son James. The year’s third quarter results also include a $111 million pretax gain from News Corp’s participation in the share repurchase programme in BSkyB, of which News Corp owns 39%.
Looking at the cable business in isolation, the unit delivered revenues of $846 million or Q3 and $2.503 billion for the nine months of the financial year, up 15% and 17% respectively on the corresponding periods 12 months earlier. Direct broadcast satellite TV operations brought in $40 million for Q3, more than double that of a year ago, and $165 million for the nine months, a 90% rise compared with the first nine months of fiscal 2011.
Clearly delighted to have some good news to comment on, Rupert Murdoch said: “With our disciplined approach to monetising our brands, I believe we are better situated than ever to capitalise on the increasing global demand for our superior content… Beyond the ongoing growth of our core businesses, I am very pleased with the company’s progress as we execute upon other elements of our strategy to produce sustained, meaningful value for shareholders… I am confident in the execution of our strategy which will continue to drive growth, create value for our shareholders and ensure the long-term strength of the company."