News Corp hit by 15pc revenue fall

News Corp's Australian publishing arm has suffered a 15 per cent drop in revenue for the year to June as the media giant strips more than a billion dollars from the value of its news mastheads.

In its annual report presented to the US Securities and Exchange Commission overnight on Friday, the company said advertising and circulation revenue from its Australian titles fell by $US350 million - or 15 per cent - from the previous year.

It also revealed it was hit by $US270 million worth of restructuring and redundancy costs due to cuts made at its Australian and US newspapers during the period.

Like its competitor, Fairfax Media, owner of BusinessDay, Rupert Murdoch's News Corp has been forced to write down the value of its Australian newspaper mastheads as the prevalence of online news outlets dilutes the power of traditional print media.

The company said in its filings it had cut the value of its Australian and US mastheads - which include The Australian, Herald Sun, The Daily Telegraph as well as The Wall Street Journal - by $US1.4 billion, as it had flagged in May. It said $US860 million of this accounted directly for the intellectual property value of the mastheads and the rest was for related assets.

Analysts said the results were possibly weaker than expected, but largely in line with what the company had flagged earlier in the year.

News Corp historically has preferred not to break out the results of its Australian newspaper business for competitive reasons. Instead it reports them as part of its News and Information Services segment, which takes into account its Dow Jones news service as well as News UK (formerly News International), the New York Post and News America Marketing.

It has also frustrated analysts and investors by failing to disclose what it makes from digital advertising and now digital subscriptions, a revenue stream that has come to life since many of its papers went behind a paywall.

While revenue for the news and information segment rose by 3 per cent for the year "increases were partially offset by lower revenues at the Australian newspapers of $US350 million". This mainly reflected lower revenues at Dow Jones and a "challenging economic environment in Australia".

News Corp, based in the low-tax jurisdiction of Delaware in the US, reported a global net profit of $US506 million for the financial year, a turnaround from a reported loss of $US2.1 billion in 2012. This was helped by income gains on acquisitions such as the $2 billion it paid for James Packer's Consolidated Media stake in Foxtel in the first half of the year.

The company's Australian newspapers were folded into News Corp's publishing business ("new News Corp") after the demerger separated its film and television business into a second listed entity, 21st Century Fox. It also includes its Foxtel business, which reported a $229 million net profit after tax - up 15 per cent from a year earlier.