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News Corp reports US$ 1.38bn income; US$ 8.14bn revenue in Q1

News Corporation (NASDAQ: NWS, NWSA; ASX: NWS, NWSLV) reported total revenue for the three months ending September 30, 2012 of $8.14 billion, a $177 million, or 2%,increase over the $7.96 billion of revenue reported in the prior year quarter.  The revenue increase was led by 16% growth at the Company’s Cable Network Programming segment, which was partially offset by declines at the Company’s Direct Broadcast Satellite Television and Publishing segments. 

The Company reported first quarter total segment operating income of $1.38 billion compared to $1.39 billion reported a year ago.  The results reflect operating  income improvements at the Company’s Cable Network Programing, Television and Filmed Entertainment segments, led by a $178 million, or 23%, increase at the Cable Network Programming segment.  These improvements were more than offset by decreases at the Direct Broadcast Satellite Television, Publishing and Other segments.  The first quarter results included a $67 million charge related to the costs of the ongoing investigations initiated upon the closure of The News of the World as compared to $17 million in the corresponding period of the prior year.  This year’s first quarter results also included $5 million of costs related to the proposed separation of the Company’s entertainment and publishing businesses.  Excluding these charges from both years, respectively, first quarter adjusted total segment operating income of $1.45 billion increased $48 million, or 3%, from $1.40 billion in the first quarter of the prior year.

The Company reported quarterly net income attributable to stockholders of $2.23 billion ($0.94 per share), compared to $738 million ($0.28 per share) reported in the corresponding period of the prior year.  This quarter’s results included $1.38 billion of income in Other, net, principally reflecting a pre-tax gain on the sale of NDS as well as a $75 million pre-tax gain from the Company’s participation in British Sky Broadcasting’s (“BSkyB”) share repurchase program, which is reflected in Equity earnings of affiliates.  These gains were partially offset by $152 million of pre-tax restructuring and impairment charges primarily related to the Company’s newspaper and digital games businesses.    Excluding the net income effects of these items, the charges related to the investigations in the U.K. and the proposed separation of the Company’s entertainment and publishing businesses, along with comparable items in both years, first quarter adjusted earnings per sharewas $0.43 compared with the adjusted prior year quarter result of $0.32.

Commenting on the results, Chairman and Chief Executive Officer Rupert Murdoch said “Our operational discipline and focus on innovation continued to drive the company’s momentum in our
fiscal first quarter, led by double-digit growth in our channels business and the global success of our film and television content.  Even against considerable currency headwinds due to a stronger dollar, we were able to increase News Corp’s revenue and adjusted segment operating profit over the prior year quarter while continuing to make key investments to position us for future growth.

“We are committed to leading the change that the  marketplace and our customers demand as the Company builds on its success at leveraging multi-platform opportunities for our content.  We believe that our ability to do so will be enhanced by the flexibility and management focus that will result from the proposed separation of our entertainment and publishing businesses.   We have made considerable progress in this process and look forward to providing more details by the end of the calendar year.”


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