News Corp. 2Q Profit Soars on Asset Sale
By SETH SUTEL
NEW YORK – News Corp. reported sharply higher second-quarter profits Wednesday on an asset sale and improving results in its Fox broadcast network and cable network programming, which includes the Fox News Channel.
News Corp. earned $1.08 billion in the three months ending in December, up from $386 million in the same period a year ago. That was equivalent to 35 cents per Class A non-voting share versus 14 cents in the year-ago period.
Revenues edged up 1.6 percent to $6.67 billion.
The latest results include a one-time gain of $381 million from the sale of an educational subsidiary last fall. Without that sale, earnings from continuing operations were $694 million or 22 cents per share. Analysts surveyed by Thomson Financial were looking for 20 cents per share.
The results were reported right after the market closed Wednesday. Shares rose 12 cents to close at $15.84 on the New York Stock Exchange.
Earnings from movies and TV production fell 26.5 percent from the same period a year ago, when the company had several home-video hits including "Day After Tomorrow." It’s not unusual for earnings from Hollywood studios to vary widely from quarter to quarter because of the hit-driven nature of the business.
Cable TV networks turned in another strong quarter, reporting a 15 percent rise in earnings on higher advertising sales from Fox News Channel as well as growth in regional sports networks.
Earnings from the company’s newspapers, which are located mainly in the United Kingdom and Murdoch’s native Australia, tumbled 62.5 percent due largely to a $99 million charge the company took as it upgrades printing facilities at its U.K. papers, which include The Times of London and The Sun.
Profits from broadcast television rose 20 percent on higher ratings from the Fox broadcast network and lower promotional costs due to the earlier launch of Fox’s new TV season. Big ratings for two returning Fox shows, "24" and "American Idol," weren’t reflected in this report since they came out after the quarter ended.
News Corp. also reported smaller losses from its Italian satellite TV broadcasting unit Sky Italia as the company added nearly half a million subscribers, widening its base to 3.6 million.
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