News Corp hit by writedown on publishing

RUPERT Murdoch’s News Corp last night posted a fourth-quarter loss of $1.55bn (£990m) after taking a major hit on the value of its publishing business and setting aside a further $57m to cover the cost of the ongoing phone hacking scandal in the UK.

Total revenue for the three months to 30 June fell to $8.4bn, down 6.7 per cent on the same period last year.

Year-end net income was $1.2bn, down from $2.7bn in 2011.

“Not only did we execute on our operating plan and deliver on our financial targets, we returned over $5bn to shareholders through an aggressive buyback program and dividends,” Murdoch said.

“Our company has continued to innovate, grow and consistently adapt to the rapidly changing media industry landscape.”

News Corp is in a state of transition, with income from its TV operations failing to off-set the turmoil in its traditional publishing business.

Ongoing restructuring led to a writedown of $1.5bn of goodwill and a further $1.3bn of intangibles in this quarter’s accounts, mainly relating to the Australian newspaper business.

At its US cable business, operating profit rose 26 per cent to $792m, as News Corp cranked up the affiliate fees it charges from cable, phone and satellite TV distributors.

Income from the company’s film production division was substantially down from $210m to $120m due to the absence of major releases in the last quarter.

Investors were disappointed with the results and pushed the firm’s Class A shares down 3.5 per cent in after-hours trading on the NASDAQ.