News Corp hit by $87m NotW costs

News Corp has reported a 43% hit on its publishing arm, which includes its UK national newspapers, reducing the unit's operating income to $218m (£138m) as it was hit by multimillion-pound costs relating to the phone-hacking scandal at the News of the World.

Rupert Murdoch: chairman and chief executive of News Corporation
Rupert Murdoch: chairman and chief executive of News Corporation

News Corporation's third-quarter results reveal that it has paid out $87m (£55m) in charges relating to the ongoing investigation into phone hacking and payments to police officers at its UK newspaper arm.

The $87m charge is in addition to the $91m (£57m) charge News Corporation announced three months ago relating to the closure of the News of the World.

Overall, the group – whose empire spans newspapers, film, TV and cable operations –reported net income up from $642m (£405m) to $1.057bn (£667m) in the three months ending December 31 2011, buoyed by the performance of its cable networks such as Fox Networks.

Rupert Murdoch, chairman and chief executive of News Corporation, said: "I am particularly pleased with the success of our business strategies, in spite of the uncertain economic conditions that we continue to face.

He said News Corporation would continue to focus on generating shareholder returns.

Across its divisions, TV reported  a 25% uplift in income from $151m (£95m) to $189m (£119m), bolstered  by advertising support for 'The X Factor' in the US and the strong viewing figures for Major League Baseball.

Income at its filmed entertainment unit more than doubled from $189m to $393m, swelled by the performance of big budget releases such as 'Rise of the Planet of the Apes' and 'X-Men'.

Its cable division – which accounts for nearly 60% of operating income – was helped by the performance of its flagship Fox channel, and its affiliate channels, which led to operating income rising from $735m to $882m.

The company's satellite division – which includes Sky Italia – shifted from the red to the black, reporting income of $6m (£3.8m), helped by increased advertising and subscription revenues.

News Corporation's publishing arm, encompassing UK newspapers, The Times, The Sunday Times, and The Sun, suffered because of last year's closure of the News of the World, reducing income from $380m (£239m) to $218m (£137m) in the period.

The group said its publishing division was also hit by lower advertising revenues at its Australian newspapers.

The Financial Times is reporting that News Corporation executives are expecting a fall of about $150m (£94m) in its full-year contribution from its UK newspapers.

Follow John Reynolds on Twitter @johnreynolds10

Have your say...

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus
Media Week Jobs
Search for more media jobs

Latest

Pamco names Jan Gooding as chair and appoints Ipsos Mori for new measurement service

Pamco names Jan Gooding as chair and appoints Ipsos Mori for new measurement service

The newly created Publishers Audience Measurement Company, Pamco, has announced that Jan Gooding, the group brand director at insurance company Aviva, is joining as chair of the organisation.

Share
Maxus brings in ZenithOptimedia's Symons as head of talent

Maxus brings in ZenithOptimedia's Symons as head of talent

Maxus has appointed Rudi Symons as its first EMEA head of talent and culture.

Share
Most people do not know how UK newspapers are funded by advertising, reveals study

Most people do not know how UK newspapers are funded by advertising, reveals study

Consumers underestimate the contribution that advertising revenue has in funding high quality editorial, research from video advertising specialist Teads has found.

Share

Get news by email