Murdoch's 21st Century Fox turns in bumper result
"Overall, our businesses are well positioned for continued growth," said John Nallen, 21st Century Fox's chief financial officer.
The company's profit for this financial year was $US6.8 billion ($7.6 billion), more than double the earnings in the previous year.
The result was boosted by $US3.76 billion in gains on the company's purchase of TV assets Sky Deutschland and ESPN Star Sports, and the sale of its stake in NDS Group.
In June, Mr Murdoch's global media empire News Corp split its broadcast and publishing operations.AU
The profitable pay TV, broadcast TV and film operations became 21st Century Fox, and the Australian, US and Britain newspapers, book publishing arm and Australian pay TV business became New News Corp.
What is now New News Corp was classified as discontinued operations in 21st Century Fox's accounts, and those operations made a profit of $US277 million in the year to June 30.
21st Century Fox's result was built on annual revenues of $US27.68 billion, up 10 per cent.
Mr Murdoch said in a statement that, with the split complete, 21st Century Fox "not only delivered strong earnings and revenue growth ... we also positioned ourselves for future success with strategic investments in our global channels businesses".
Mr Nallen said 21st Century Fox's growth in the next financial year would be driven by the company's cable TV business, but its filmed entertainment business would "be down a touch" on the past year.
"In 2014, our growth will be impacted by several strategic initiatives, most notably the launch of sport networks here in the US and Asia as well as the launch of [cable TV network] FXX," Mr Nallen said.
"Additionally, we are expecting adverse currency effects to impact 2014 growth, principally from Latin American currencies and the Indian rupee."
The company's Australian listed shares rose 29¢ to $35.11, while New News Corp shares rose 12.5¢ to $18.09.
Frequently Asked Questions about this Article…
21st Century Fox reported a profit of US$6.8 billion (A$7.6 billion) for the financial year — more than double the earnings of the previous year, according to the article.
The result was boosted by US$3.76 billion in gains tied to the company’s purchase of TV assets Sky Deutschland and ESPN Star Sports, plus the sale of its stake in NDS Group. These asset transactions materially lifted the year’s profit.
In June the global media empire split its broadcast and publishing operations. The profitable pay TV, broadcast TV and film operations became 21st Century Fox, while Australian, US and UK newspapers, book publishing and Australian pay TV became the newly separated New News Corp. New News Corp was treated as discontinued operations in 21st Century Fox’s accounts.
Annual revenues were US$27.68 billion, up 10% on the prior year, the company reported.
CFO John Nallen said growth next year would be driven by the company’s cable TV business. He also warned that filmed entertainment would be “down a touch,” and that growth in 2014 would be impacted by strategic initiatives — notably the cost of launching sports networks in the US and Asia and the launch of the cable TV network FXX — as well as adverse currency effects from Latin American currencies and the Indian rupee.
According to the article, 21st Century Fox’s Australian‑listed shares rose 29¢ to A$35.11, while New News Corp shares rose 12.5¢ to A$18.09 on the day the results were reported.
The operations that became New News Corp were classified as discontinued operations in 21st Century Fox’s accounts and made a profit of US$277 million in the year to June 30.
Key takeaways for investors are: the company reported strong earnings and 10% revenue growth, much of the profit was supported by sizeable gains from asset transactions, management is investing strategically in global channels and new networks, and near‑term growth may be affected by the costs of launching sports networks and currency headwinds. These points help explain both the strength of the reported result and the risks to watch going forward.
Call 1300 880 160
Start a chat
Schedule a call
