News Corp reports 12pc lift in earnings

News Corp has posted a near-12 per cent increase in earnings at the conclusion of its first fiscal year, with chief executive Robert Thomson predicting an improvement in Australian advertising revenues.

Mr Thomson told analysts after the fourth quarter results:  “There are indications that the rate of decline has declined in Australia. There are green shoots on the Nullarbor Plain.”

Overall the company reported total segment earnings before interest, tax, depreciation and amortisation of $US770 million, compared with $US688 million in the previous year, a rise of 11.9 per cent.

This was despite a drop in revenue from $US8.57 billion in the 12 months to June 30, compared to $US8.89 billion year prior – a decline of around 4 per cent.

The majority of the revenue decline reflected lower advertising revenues at the newspapers, foreign currency fluctuations and the sale of the Dow Jones Local Media Group. The cable networks division, which houses Fox Sports Australia, saw revenues fall by 2 per cent.

Total advertising revenues were down 7.5 per cent to $US4.02 billion, However, there was a lift in the last quarter, with advertising revenue down a more moderate 6.1 per cent to $US1.03 billion. Australian newspaper revenues declined 18 per cent for the full year, of which 10 per cent was related to the weak Australian dollar.

REA – which is 61 per cent owned by News Corp – announced a 37 per cent rise in underlying net profit in the year ended June 30 to $149.88 million from $109.746 million the previous year. REA grew its revenue from depth listing products by 69 per cent to $220 million.

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