EARNINGS RELEASE FOR THE QUARTER ENDED MARCH 31, 2008 NEWS CORPORATION REPORTS THIRD QUARTER OPERATING INCOME OF $1.4 BILLION; GROWTH OF 16% OVER THIRD QUARTER A YEAR AGO REVENUES INCREASE 16% TO $8.75 BILLION NET INCOME INCREASES $1.8 BILLION TO $2.7 BILLION QUARTER HIGHLIGHTS • Television operating income up 53% led by lower prime-time programming costs and advertising strength at the FOX broadcast network, improved results from MyNetworkTV and the positive impact of Super Bowl XLII at the television stations. • Cable Network Programming operating income up 17% despite launch costs for the Fox Business Network and the Big Ten Network. Growth led by gains at the Fox News Channel, the Regional Sports Networks, FX Network and Fox International Channels. • SKY Italia generates operating income of $97 million, an increase of 7% versus a year ago, reflecting net subscriber additions of 342,000 over the past 12 months as the subscriber base expands to 4.5 million. • Filmed Entertainment delivers operating income of $261 million on strength of successful theatrical release slate and home entertainment titles. • Magazines and Inserts operating income declines 9% on lower rates and page volume for free-standing inserts. • Newspapers and Information Services operating income increases 38% versus a year ago led by advertising growth in Australia, lower depreciation costs in the U.K. and the inclusion of Dow Jones & Company. • Completed a $10.1 billion stock buyback through the exchange of The DIRECTV Group, three Regional Sports Networks and approximately $625 million in cash for approximately 16 percent interest in the Company’s common stock. NEW YORK, NY, May 7, 2008 – News Corporation (NYSE: NWS, NWSA; ASX: NWS, NWSLV) today reported third quarter net income of $2.7 billion ($0.91 per share) as compared with $871 million ($0.27 per share on a diluted combined basis1) reported in the third quarter a year ago. The year-on-year growth reflects an increase in Other, net of $1.6 billion primarily reflecting a $1.7 billion tax-free gain on the asset and stock exchange with Liberty Media Corporation. Additionally, increases in consolidated operating income partially offset by lower equity earnings contributed to the improved results. News Corporation E A R N I N G S R E L E A S E F O R T H E Q U A R T E R E N D E D M A R C H 3 1 , 2 0 0 8 Page 2 Consolidated operating income for the third quarter of $1.4 billion was up 16% versus the $1.2 billion reported a year ago, primarily driven by double-digit percentage increases at the Television, Cable Network Programming, Newspapers and Information Services and Other segments. Third quarter net earnings from affiliates were $109 million versus $255 million reported in the same period a year ago. The $146 million decrease was primarily driven by lower contributions from BSkyB due to the write-down of its ITV investment and by a decrease in contributions from The DIRECTV Group as a result of the Company’s exchange with Liberty Media Corporation in February 2008. Commenting on the results, Chairman and Chief Executive Officer Rupert Murdoch said: “Our 16% revenue and operating income growth this past quarter is a great illustration of how the diversity of our asset base is translating into sustained financial success. We delivered growth from advertising based businesses, such as our television stations and broadcast network, and we delivered growth from subscription based businesses, such as our domestic cable channels. We delivered growth from established businesses, such as our newspapers and we delivered growth from our developing assets, such as our international cable channels and Fox Interactive Media. Our ability to generate returns from a multitude of sources puts us in a great position to maintain our financial momentum even in times of economic uncertainty.”
NWS Price at posting:
0.0¢ Sentiment: ST Buy Disclosure: Not Held
(20min delay)