Rupert Murdoch’s split of News Corp into the old and the new seems to working, for one half, at least. 21st Century Fox has reported higher revenue and profit with growth at its cable operations including Fox News and its regional sports networks.
“Although a significant amount of time and effort was spent over the past 12 months on this separation, we never lost focus on the operation of our businesses,” Murdoch, who serves as chairman and CEO of Fox, said.
The entertainment properties are in 21st Century Fox while the publishing company – which includes the Wall Street Journal and the Times, book publisher HarperCollins, the education company Amplify and pay-TV services in Australia – keep the News Corp name.
Fox’s cable networks including the Fox News Channel, FX Networks and National Geographic channels, said quarterly operating income up 25% to $1.8 bn on higher affiliate fees and advertising revenue. Fox said the company’s cable networks account for two-thirds of total earnings before interest, taxes, depreciation and amortisation (edbitda).
Fox is to invest $200m next year in new channels including Fox Sports 1 this month, a competitor to ESPN, and a new channel FXX aimed at young adults.
At its movie studio 20th Century Fox, operating income fell to $117m from $140m on lower contributions from its TV production studios. Its broadcast TV station Fox is still dogged by lower ratings for its show American Idol that dragged down advertising revenue 7% and segment oibda to $213m from $235m.
Total revenue rose 16% percent to $7.2bn for the quarter ending in June, compared with the same quarter last year. Net income was $977m from $596m, in the same quarter last year.
21st Century Fox COO Chase Carey said Sky Italia would ‘restructure costs for the reality of the Italian economy.”
He said the company’s current plan to reduce the cost of major content contracts as they come up for renewal over the next 12-24 months “will enable us to have a very profitable and strong Sky Italia, even in today’s current economic circumstances, that can grow the top line more aggressively when the economy improves.”