News Corp posts $422 m first-quarter profit

NEW YORK: Things are looking up at Rupert Murodoch's media conglomerate News Corp. The company has reported that its first-quarter profit more than doubled on strong DVD movie sales of Daredevil and Phone Booth as well as ad gains at its Fox News channel.

The Sydney, Australia-based owner of the New York Post, 20th Century Fox studios and Gemstar-TV Guide posted a net profit of $422 million, or 32 cents per American depositary receipts, compared with $162 million, or 12 cents per ADR, a year ago.

However Fox's television network suffered a 20 per cent decline in prime-time ratings in the quarter. Reports indicate that the drop suggests some of the difficulty that the company faces finding successors to its recent reality television hits like American Idol and Joe Millionaire. In India the latter airs on Star World. Revenue at the television division fell to A$1.01 billion from A$1.02 billion.

At the company's Filmed Entertainment division, the biggest contributor to its earnings, revenue rose to A$1.25 billion from $882 million in the first quarter of the previous year, Looking ahead the company is placing its bets on the Russell Crowe starrer Master And Commander which recently opened in the US.

However due to the disappointing performance at the television outfit its operating income, which accounts for a quarter of the company's total, fell five per cent, to $179 million. The Fox Broadcasting Network reported an operating loss of $45 million, compared with a loss of $8 million a year earlier. This managed to offset higher profits for Star TV.

News Corp COO Peter Chernin attributed this to the cancellation of several new shows like The Ortegas and Cedric. Reports also indicate that News Corp gets about 75 per cent of its revenues and around 80 per cent of its operating income from the US.

Meanwhile, the newly appointed chief executive of BSkyB, James Murdoch has pledged to resume dividend payments of the company after a five-year gap. "There is a resolution at the board to discuss future dividends and that will be done," he says.

Murdoch also says that BSkyB's cash flow would not be diverted to funding projects for News Corp, the media empire controlled by his father Rupert Murdoch that owns about 35 percent of BSkyB.

Calls for a resumption of dividend payouts rose earlier this year when BSkyB reported its first annual profit in five years for the year to June, as it continued to add subscribers and grow revenue.

Also, revenues for the Big Three broadcasters, ABC, CBS and NBC have also gone up almost six per cent in the third quarter, according to data compiled by accounting firm Ernst & Young.

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