News Corp has released its results for the third quarter, with a four per cent increase in total segment EBITDA while total revenue was down five per cent.
Revenue dropped from US$2.18 billion in the previous third quarter to $2.08 billion, attributed mainly to foreign currency fluctuations, lower advertising revenues at the News and Information Services segment and the sale of the Dow Jones Local Media Group.
The total segment EBITDA of $175 million was a four per cent rise on $169 million in the last year.
The increase was driven by strong performances in Digital Real Estate and Book Publishing segments, offset by the News and Information Services segment.
“The past quarter marked another robust stride in the direction of expanding our digital and international businesses, which was the goal we articulated on our investor day last year,” chief executive Robert Thomson said.
The company is set to benefit from a wider reach in its purchase of Harlequin publishing group, and it was already “reaping benefits” from its acquisition of Storyful, according to Mr Thomson.
He said Storyful was “powering a new social newswire and creating video content communities around our mastheads, whose digital transition is continuing apace.”
The improved results underscored the strength and diversity of the company’s portfolio, he continued. “It is also patent that we have been consistently disciplined on costs across the company and around the globe, leading to an improvement in our profitability.”
Last year’s sale of SKY Network Television in New Zealand was a major influence on net income available to stockholders, which was $48 million compared with $323 million in the prior year.
Net income per share was $0.08 as compared to $0.56 in the prior year.
Free cash flow available to News Corporation hit $496 million, a jump of $362 million in the nine months to March 31, 2014, from $134 million in the previous fiscal year.
21st Century Fox, which formed last year from News Corporation’s split and removed itself from the ASX in March, posted strong operating profit growth for the same quarter, with OIBDA up fourteen per cent. Revenue was also up from $US7.35 billion to $US8.22bn.
Its cable networks business was a major profit driver, posting $US1.2bn OIBDA, a growth of ten per cent, and revenue of $US3.15 billion, up from $US2.82bn.
Overall profits in the third quarter hit $US1.05 billion, a drop from $US2.9bn in the same period last year, attributed primarily to Fox’s acquisition of a controlling stake in Sky Deutschland, a satellite operator.
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