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Legal settlement drags News Corp to loss
[NEW YORK] News Corp said Thursday a one-time legal settlement charge pushed the media giant into a loss in what it described as a "disappointing" quarter.
The conglomerate controlled by Rupert Murdoch and his family, which includes newspapers around the world and a large online real estate website, reported a net loss for shareholders of US$149 million in the quarter to March. That compared with a US$23 million profit a year ago.
Total revenues slipped around seven per cent to US$1.9 billion.
The bottom line was hit by a US$280 million charge to settle a lawsuit brought by consumer packaged goods companies that accused News Corp of controlling a monopoly on in-store advertising in the United States.
Chief executive Robert Thomson said that excluding one-time charges and currency impacts, the quarter "was still disappointing" but that "the company is on track to see improvements" with the expansion of its digital real estate business "and cost saving initiatives taking firmer root."
The "news and information" division that includes the Wall Street Journal, New York Post, Times of London and Sunday Times, The Sun and a group of newspapers in Australia, saw a drop in both circulation and advertising revenues.
"While we believe in the strength of our print properties, we are also investing energetically in the rapid pursuit of digital which is clearly evident in the transition at Dow Jones," Mr Thomson said.
Digital accounted for more than 50 per cent of total revenues for the first time at Dow Jones, the parent of the Wall Street Journal, and digital-only subscribers for the newspaper grew to 893,000, he added.
"We are building a strong digital platform on top of the WSJ print circulation which today is double the size of its nearest competitor." A bright spot for the company was its realtor.com business, which includes the popular real estate listings website, and saw a 30 per cent jump in users along with a boost in revenue and operating profit.
The unit recently acquired Asian-based rival iProperty, which helped lift results.
"We are particularly focused on driving mobile revenue growth, and are pleased with the results at realtor.com, where the mobile audience grew close to 50 percent this quarter, and now represents 60 per cent of page views and the majority of leads," Mr Thomson said.
Mr Murdoch split his corporate empire into two separate firms in 2013: 21st Century Fox, which includes major television and film operations, and News Corp., which kept the newspapers and other publishing assets that had been a drag on earnings.
He remains in control of both firms but has gradually begun to exit from operations.
Mr Murdoch and his son Lachlan Murdoch are co-executive chairmen at both companies.