11/4/2009 6:46 PM
News Corp. 1Q income posts surprising growth
By RYAN NAKASHIMA
AP Business Writer
Media conglomerate News Corp. said Wednesday its net income for the latest quarter grew despite analysts' expectations of a decline, thanks to strength at its cable networks and the box-office success of "Ice Age: Dawn of the Dinosaurs."
The company is facing multiple challenges, including an advertising downturn and the shift of readers to the Internet. Newspaper and TV station earnings fell but they were more than offset by cost-cutting and gains elsewhere.
Net income for the company's fiscal first quarter, which ended Sept. 30, increased 11 percent to $571 million, or 22 cents per share, compared with $515 million, or 20 cents per share, in the year-ago period. Analysts surveyed by Thomson Reuters were expecting a drop to 18 cents per share.
Revenue fell 4 percent to $7.2 billion, in line with estimates.
Chief Executive and lead shareholder Rupert Murdoch called the results "exceptionally strong" and said the company's businesses were improving.
"The economies in which we do business are clearly in better shape than they were a year ago," he said in a statement.
Citing better movie performance and a better market for local TV ads, News Corp. also raised its annual forecast for fiscal 2010 operating profits to growth in the "high single- to low double-digit" percentages from its 2009 level of $3.44 billion. The fiscal year ends in June.
Earlier, News Corp. predicted only "high single" digit percentage gains.
Quarterly profit in the studio, 20th Century Fox, surged 56 percent to $391 million thanks to the theatrical success of "Ice Age" and "X-Men Origins: Wolverine" on home video.
Cable networks, including Fox News Channel, saw operating income grow 41 percent to $495 million, but newspaper earnings shrank more than 80 percent as lower ad revenue hurt The Wall Street Journal despite increases in circulation revenue from higher prices.
Shares in the New York-based company were flat at $11.56 in after-hours trading following the earnings release Wednesday, after closing up 12 cents.
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(Copyright 2009 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)
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(Copyright 2009 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)
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