News Corp’s Australian newspapers sees 22 per cent revenue drop

news corpRevenues for News Corp’s Australian newspapers have continued to freefall, numbers for the company’s first US financial quarter suggest.

According to a filing to the US Securities and Exchange Commission, the company’s global revenues dropped by $171m between July and September, and most of this was because of the company’s problems in Australia. It revealed: “Australian newspaper revenues declined 22 per cent and accounted for the majority of the revenue decline compared to the prior year.”

The company has been racing to remove much of the centralisation of sales operations put in by former CEO Kim Williams which coincided with a collapse in the company’s revenues.

The 22 per cent fall in the first quarter may signal that the decline in the company’s has accelerated so far in this financial year, although the number also looks worse because of fluctuation between the US and Australian dollars.

Full year numbers released in September, revealed that the company’s revenues had dropped by $350m in the last financial year, a fall of 15 per cent.

Last week Fairfax Media told the market that its metro newspaper revenues were down by nine per cent and its regional newspaper revenues by ten per cent.

Williams was ousted as Australian CEO in August and replaced by Julian Clarke.

Last week News Corp’s global boss Rupert Murdoch blamed “ignorant consultants” for the company’s woes.

Globally the company reported an EBITDA profit of $141m, up on last year largely thanks to the numbers for Fox Sports, which it now wholly owns, being included in the numbers.

Fox Sports Australia had revenues of $132m and an operating income of $39m, for the three months ending in September 30 2012, and experienced growth in advertising revenues from improved ratings and increased government election spending and an increase in subscription revenues.
The company said there were lessons to learn from the Wall Street Journal in the US and The Sun in the UK on how the company drives its digital subscriptions locally.

“It’s very early days, as you know, and we have a new management team in place in Australia, under the great leadership of Julian Clark.

“Julian is looking at that strategy at the moment, what we’re able to do as a company is learn from each other so there will be lessons from the Wall Street Journal, there will be lessons from Sun Plus, and that genuinely is one of the advantages of the new News.”

The company said there had been good growth in digital subscriptions such as the Wall Street Journal and potentially strong growth in digital advertising because of the “genuinely premium audience” who are paying to access the content.

Bedi Singh, News Corporation’s chief financial officer, said the 22 per cent fall – reported in US currency – was worsened on the balance sheet because of currency fluctuations.

“News and information services revenues declined $171m or 10 per cent versus the prior year and Australia accounted for $121m or around 70 per cent of the segment decline, of which almost half was due to foreign exchange.

“In Australia the advertising revenue declined around 22 per cent which included a 10 per cent negative impact from foreign currency and in terms of the cost side of the equation we expect cost saving to continue.

“Over the past three or four years we have done significant amounts of restructuring across our businesses, mainly on the newspaper side. I think the total over the last four years are something around $500m.

“Clearly we keep looking at operational efficiencies as we go forward, but you have to realise a substantial amount of efficiencies have been taken out. We will keep continuing to look at natural operating efficiencies as we roll out the common publishing system, but I don’t think we have any particular targets or slash and burn type of cost reductions in mind as we go forward.

“Expenses are on the right track while the revenues remain under pressure. We have been candid about some of the headwinds we face, particularly in news and information services. We continue to view 2014 as a transition year as we balance our operational efficiencies with prudent investment and focus on stabilising top line performance.”

News Corp shares slid after the first quarter results were released and fell below Wall Street estimates, with Class A shares falling by 2.4 per cent to $17, while Class B shares declined 2.1 per cent to $17.41.

Megan Reynolds and Tim Burrowes

Comments


  1. Anonymous
    12 Nov 13
    9:49 am

  2. Odd that The Australian would forget to report that 22 per cent revenue drop in its news story: http://www.theaustralian.com.a.....6757820081

  3. Ex News Person
    12 Nov 13
    10:04 am

  4. The company’s woes should be equally blamed on the ignorant new management that allowed the recommendations of the ignorant consultants to be rolled out wholesale across the business.

  5. Phil
    12 Nov 13
    10:12 am

  6. Bwahahahahahahahaha. Oh god it’s just too good to be true. All those “journalists” (quotes because they’re not really journos when they work for Murdoch and Co) sitting there at their desks just waiting for the pink slips to arrive.

    God I hope they have massive mortgages too and little hope of getting future employment. Schadenfreude is my favourite emotion especially when I think of the muppets that work for Murdoch.

  7. mumbrella
    12 Nov 13
    10:23 am

  8. Hi Phil,

    Thanks for your comment. You may (and I think do) have an issue with a handful of News Corp’s highest profile journos and columnists on titles like The Oz or The Tele. It’s worth remembering that they employ more than 2000 journalists in Australia, which makes them the biggest employer of journos in the country.

    Most of those are ordinary journos doing very ordinary journalistic jobs, many of whom are working on much smaller and uncontroversial titles.

    They also tend to be the type of roles which suffer when costs are cut.

    Judging someone just because they “work for Murdoch” is in my view something of a lazy generalisation.

    Cheers,

    Tim – Mumbrella

  9. Shamma
    12 Nov 13
    10:24 am

  10. Phil that’s pretty bleak – look past ‘working for Murdoch’ and these employees are people too. Wishing they have big mortgages and little chance of future employment is a real c*nt of a thing to wish upon someone.

  11. Dan
    12 Nov 13
    10:39 am

  12. Unfortunately, like Phil, the Australian public largely doesn’t care, even if they are aware. As you say Tim, except for a few high-profile types, the vast majority of News Corp journalists are honest, hardworking people who are just out to make an honest dollar (I’m not saying the high-profile types aren’t honest and hardworking, but they are in the thrall of their political biases and their proprietor.

    It’s a bit like the carnage about to happen in the Australian Public Service. The overwhelming majority of public servants are talented, hardworking people who do not deserve the scorn that is constantly heaped on them. But, by and large, the public just doesn’t care. The public will only care when they no longer have viable journalism and no longer get the services provided by public servants. I should declare an interest; in my career, I have been both a journalist and a public servant. I think I worked harder in the Australian Public service (for much less financial reward). Sometimes you don’t know what you’ve got till it’s gone.

  13. Phil
    12 Nov 13
    10:45 am

  14. Well in my defence Tim “lazy generalisations” are the raison d’etre of the Murdoch press. I was just aiming my comments at a level they could understand.

    I’m sure there are many hard working journos working at Murdoch publications just as there are many hard working secretaries and IT people etc working for Philip Morris and companies of that nature. And just like I do with people who choose to work for a tobacco company if you decide to work for Murdoch then I’m going to judge your personal ethics etc based on that fact. I’m also going to take a lot of joy in the fact you’ll shortly be unemployed, unlike say a person who decided to become a nurse and contribute to their society.

  15. Simon Canning
    12 Nov 13
    11:13 am

  16. Hi Tim,

    Thanks for backing up the many fine journos who do still work at News. I took a redundo last year, Phil, after working with News at various times in my career. I loved working there and was often proud of the work I did. Whether you like Rupert on not, those who remain continue to break important stories. Yes, they often write garbage as well, but that is just part of being a newspaper. It was ever thus. Journalism exists to entertain as well as to expose and inform.
    Enjoy your dance on the “graves” of those who value journalism and strive to to their best and really do want to serve the community. If the day ever comes that the presses, ink or digital, finally shut down, perhaps then you will see the vast chasm in accountability that will be left. Frankly, I hope that day never comes. Journalism, be it run by Murdoch, Fairfax or the ABC, is too important to lose.

  17. Sue
    12 Nov 13
    11:15 am

  18. Journalists have been let down by politicians who gave their power away to Murdoch by allowing his company to become the dominant employer in Oz. In return for political supprt politicians allowed him to buy up the majority of news papers. Now, there are not many options for employment in journalism in this country. Unfortunately for them & us it now appears the only way to get rid of his malign imfluence is for his company to go broke and people to consequently lose their jobs. Hopefully, out of the wreakage will come a variety of news sources which give equal airing to a variety of voices & opinions. I’m sure many journalists would like to be free to report without ‘editorial direction’ filtering their work. But I, along with Phil, will be dancing on the grave of Ltd News when, hopefully, this does occur.

  19. Boots
    12 Nov 13
    11:35 am

  20. Phil is just a pathetic and bitter soul with a crazed Murdoch obsession. Just imagine what a pitiful existence he must lead. I’m depressed for him.

  21. ian
    12 Nov 13
    11:36 am

  22. I agree with Phil.

    The fate of 2000 journos employed by Newscorp is of no interest to me. So what if they lose their jobs, and as a consequence, their houses, private school education for their children and everything else in general. If they are either ignored or scorned by the general population I say….welcome to the world you helped to create. If you survive in it…well and good. If you don’t?…who cares.

  23. Neil
    12 Nov 13
    11:46 am

  24. I’ll defend Phil…

    Those hard-working journos at the various Murdoch companies know who they work for. They know what he does. I would rather move (with my kids) into a homeless shelter than contribute a minute of my time to News corp.

    Murdoch’s agenda is going to systematically reduce the standard of living in every ‘liberal democracy’ on the planet. Even if he doesn’t see it this way himself, we know that his ideology leads to a cliff, and he’s slowly accumulating the power to ensure we can’t turn back.

    So the hell with them. They are all enablers even if they can’t see it. Even the mail-room guy at the smallest Murdoch press has had more than enough time to get out by now.

    The tiny number of people who genuinely don’t have any other opportunities for work will just have to deal with the reality of life without Murdoch – which is going to be a lot better for them in the long run anyway.

    The relief and joy I would feel if News crashed isn’t going to be diluted by giving a crap about the people who work there – ‘innocent’ or otherwise.

  25. Dave.
    12 Nov 13
    12:06 pm

  26. I think the majority of News Corp employees are just happy to have a job, earn a living and feed their families.

  27. Danny
    12 Nov 13
    12:40 pm

  28. I’m not as passionate as Phil on his views but I do agree.

    Those people choose to work for Murdoch and they, as a whole, are systematically reducing the field of journalism and print media to a moron’s playground.

    All those budding understudy’s that are ‘working hard’ aren’t aspiring to be great journalists – they want to be the next big hack writer who stirs the pot with lies based upon lies. There’s simply no merit in that.

    Vale News Corp.

    You won’t be missed.

  29. Lazy Generaliser
    12 Nov 13
    12:55 pm

  30. News is a big organisation and consequently has both ethically compromised and ethically strong people within it.

    As a former employee who is now on the outside I’ve seen many examples of both.

    However, in the year 2013 you can be under no illusion as to the underhanded methods that are endemic and come from the very top of the organisation. Ignorance is never a defence but after the last few years it’s a damning indictment.

    News’ is a repeat offender, its founder was ruled unfit to run a company by British Parliament and in Australia the offences are different but still serious. We’ve all known it for years. I no longer have any sympathy for my former colleagues. Not for the worst offenders at the top who have driven Rupert’s agenda and not for the mailroom boy who is just trying to get a start in the industry. You might be the smallest cog in a vengeful machine but you’re still part of the machine.

    Time is up for this company and for the staff who continue to cash Rupert’s cheques.

    Phil’s critique was clumsy. He used a bazooka when he needed a scalpel but his central point is valid. I enjoyed working with and reading Simon Canning but his defence is a classic case of misdirection (straight from News’ bag of tricks). Phil did not attack journalism, he did not attack Fairfax or the ABC. He clearly stated that he had no sympathy for people in the employ of Murdoch. Not your best work Simon. You were no lackey when you were at News and you’re doing great things now but you’ve screwed the pooch on this one.

    Tim, you’ve answered Phil’s lazy generalisation with a lazy generalisation. It’s not just the high profile editors and journalists that have misused their power and run personal agendas. Yes, Whittakers’ editorship is questionable as is Simon Benson’s petulant and power hungry reaction as recorded in the ‘Rum Rebellion’ but News’ abuses stretch across the length and breadth of the business.

    Some of the worst cases of bullying and controlling the news agenda I witnessed were at small regional papers where there was no alternative news source. Local editors and reporters are big fish in a tiny pond. You will have never heard their names or read their work but the power they possess in small communities without a counter viewpoint is bordering on absolute and frequently misused.

    I won’t shed a single tear for the doomed ship News Corp nor any who sail in her.

    Journalism is not the same as mainstream media. In fact in many cases they are diametrically opposed. We’re now privy to more viewpoints than ever before (Mumbrella being a case in point). Both journalism and the world in general will be a better and fairer place without Murdoch’s all pervading shadow looming over it.

  31. Boots
    12 Nov 13
    1:17 pm

  32. I’d bet any money that Phil, Ian, Neil & Danny are the same person. A bitter, deluded loser at life creating multiple online identities to back up his insane views.

    The levels of delusion, anger & ignorance are matched only by the lunacy of the rants. I laughed out loud several times reading through the comments.

    Gosh I hope he never breeds.

  33. Elle
    12 Nov 13
    1:39 pm

  34. Wow, it’s getting crowded at the top of the Hill of Self Righteousness! The Murdoch Press is reaping what they have sown – massive revenue falls would appear to be the direct result of shameful editorial policy in major publications.

    To wish job losses, losing a house and a general plague & pestilence on anyone who works for News Corp disgusts me and those who have made those comments disgust me. As Tim said, it is unlikely that the high profile names (I won’t call them journalists) will lose their jobs anytime soon. It will be those who are considered to be expendable and they will likely struggle to find employment in a tightening job market.

    By all means, do your dance of spite over Murdoch, but leave ordinary people who are making a living out of it.

    By the way, could all you perfect people at the top of the hill instagram how perfect it is so that the rest of us can have a peep at your perfect lives? Thanks

  35. Barry Southerland
    12 Nov 13
    1:40 pm

  36. “It’s worth remembering that they employ more than 2000 journalists in Australia, which makes them the biggest employer of journos in the country.”

    And here’s the problem with the Australian media in general. The News Corp reality is never challenged by other journos becasue they might have to get a job there one day

  37. TheFacts
    12 Nov 13
    2:25 pm

  38. Perfect example of the appalling standard of ethics under Tele editor Paul Whittaker: In their breathless endorsement for the Packer casino on Sydney harbour, today they claim it will become a “symbol for Sydney like the bridge or the opera house”. Comparing a casino & apartment building with these special symbols of Sydney shows how far they will go to push their interests and editorial line. Not one dissenting view published from any prominent planner or architect (and there are many if you read other media). So much for holding the powerful to account. They don’t

  39. Neil
    12 Nov 13
    2:48 pm

  40. Simon Canning’s post is pretty hilarious. You can tell he’s a journalist because of the strawman he sets up and then knocks down so resoundingly, and you can tell he’s a News Corp-era journalist because it’s so clumsy and poorly done.

    As anyone with a functioning synapse should know – the end of News Corp would be an opportunity for the *return* of journalism, not it’s end.

    There’s not a single syllable in any of their papers today that counts as journalism in the sense Simon is claiming.

    Boots – have you *got* any money? I’d be happy to take it. I’ll even offer you odds of a thousand-to-one.

  41. TheFacts
    12 Nov 13
    2:54 pm

  42. Further to my earlier comment regarding the Tele’s completely one sided reporting, the following is an example of how it should be done – http://smh.com.au/travel/trave.....2xcij.html

    The SMH’s commentators have been mostly critical of the new casino but the above news article perfectly balances responses from those in favour of the casino and those against. You never see that from the Tele under Whittaker. It is the opposite of what journalism is supposed to be about . And it’s certainly not in the public interest

  43. adam
    12 Nov 13
    3:28 pm

  44. Maybe some Australian’s don’t like to be told what to think and how to vote, and instead are casting their own vote against Rupert with their eyeballs and wallets. Here’s hoping that’s some part of the decline.

  45. fleshpeddler
    12 Nov 13
    4:07 pm

  46. Phil,

    I think your views are disgusting.

    You take a moral stance on News but then show a complete lack of human empathy for the people that work there and may lose their livelihoods and a disregard for the impact that will have on them and those around them

    how are you any better than the worst examples of News Ltd leaders?

  47. Red Bean
    12 Nov 13
    5:33 pm

  48. Team Phil. Couldn’t happen to a nicer bunch!

  49. Gerry
    12 Nov 13
    5:54 pm

  50. I couldn’t agree with fleshpeddler more. Phil, it’s a pretty ghoulish way you express yourself. Ian “welcome to the world you helped create” – really? You guys are so blinded by hatred you’ve lost your humanity.

  51. Chris
    12 Nov 13
    5:54 pm

  52. I’m one of ‘those’ who cancelled my subscriptions to anything connected with NewsCorp.
    Paying to get access to garbage is not a useful way to expend my dollars.
    Nothing against the unseen foot soldiers toiling behind the scenes but I’m old enough to remember when a journalist was one who reported the actual news.
    Not made it up.
    Not ‘forgot’ to mention other salient points that might make the reader think about the whole situation.
    And didn’t express their own personal view under the guise of ‘fact’.
    As pointed out above a revival of real journalism is on the cards.

  53. ian
    12 Nov 13
    7:41 pm

  54. By the way, could all you perfect people at the top of the hill instagram how perfect it is so that the rest of us can have a peep at your perfect lives? Thanks ‘

    I’m not at the top of the hill, or anywhere near it for that matter. I do know, however, that the more I look to the pinnacle I see that the old fashioned concepts of pride, honour and ethics will make the climb no less hard, but lighter. You may wish to give it a go.

    I am not one of four personalities. In fact I’m a mid sixties, retired blue collar worker. The one thing I did learn over my working life is that if a boss demands that you compromise your morality and/or ethics you don’t work there. You get out as soon as you can. You show a bit of guts.

    You may say that journalism is more nuanced than that. I don’t believe you. Honest endeavour is honest endeavour. For any society to survive and prosper the truth must win out. Society has charged journalists with that onerous responsibility….not many have taken up the challenge.

    As journalists ask yourselves this……what have I done to enrich this world with a sense of awe and wonder that the following generations, especially the children, will grow from?

    The last three years of corporate directed groupthink answer that….and that’s why I don’t give a toss what the future deals you. You’ve earned it…..tenfold

  55. Good lord
    12 Nov 13
    8:02 pm

  56. You are! No you are! No you are!

  57. Rupert Allan
    12 Nov 13
    10:38 pm

  58. The 22% revenue drop? It’s all Labor’s fault. Every bloody thing is Labor’s fault. Don’t you people realise that by now? But, now we’ve got the right mob in, she’ll be right (that is if we could possibly get even further to the right).

  59. Realist
    13 Nov 13
    10:06 am

  60. Just wondering if the dancing on graves extends to all those at News who don’t happen to work on the major papers? Will you be thrilled to see some of the most passionate sports journalists and supporters of grass roots sport at Fox Sports lose their jobs? Will you laugh when those people who’ve worked their butts off to make it in fashion media are sacked when Vogue and GQ are shut? (There’ll be nowhere for them to go – just look at what’s happening at Bauer.)
    You’ll be pleased to see the back of those nasty people at Kidspot, churning out those insidious stories on how to soothe a baby with colic? And as for those Gen Y’s at news.com.au giving a voice to people who’ve never even bought a newspaper – let’s ruin their lives as well.
    Seriously, if every worker in the country was expected to quit because they didn’t agree with the ethics of their boss (er, bank CEO pay, NSW State Govt anyone?) half the workforce would be at Centrelink right now.

  61. Patrick
    13 Nov 13
    12:49 pm

  62. Over the last 20 years I was an occasional subscriber and long term reader of the Oz. Not any more. I like parts of the paper but its strident advocacy of position and house ideology became predictable and annoying – it was, frankly, like reading the Green Left Weekly for the other side. Worse the personal denigration of anyone who should dare not espouse the same doctrinal view.

    Having said that, News Corps decline is no worse than, say, Fairfax. It seems less about the nature of the product than the product. The daily paper now seems less a place of revelation or news than a rehash and re-spinning of what happened the day before.

  63. Eric Vigo
    13 Nov 13
    2:19 pm

  64. What I take away from Phil’s comments is similar to when I was a young activist – any cooperation with something I hate means you are tarnished with the same brush, and therefore deserve all that comes to you. Based on the fact that I have turned attention to you and involved myself. In the end, it’s probably random where that attention goes.

    For instance, orthodox Marxist-Leninism has many targets of their own. One is the property-owning class. I can’t off the top of my head think of any ML jargon, but the result was nationalisation of all property, and retribution to landlords through a gulag or some sort. I gather it was a ‘that’ll show ‘em’.

    I’m not saying Phil thinks that way about private property owners, but it comes from the same pot. Just that ML have traditionally put their prejudices into practice with pretty bad effects and (it seems) loving the consequences.

    I don’t love the Murdoch press, but when we start looking at the greys, not everyone is the same. I find swimming in the greys far more intellectually stimulating and personally challenging than black’n’whiting everything. As Colbert said “reality has a liberal (small l) bias…”

  65. Bill
    13 Nov 13
    10:57 pm

  66. In general, I agree with Phil’s sentiment. The fact they employ over 2000 journalists, a huge concentration, is the issue. Maybe if there wasn’t so much concentrated power this wouldn’t be an issue?

  67. ian
    14 Nov 13
    3:02 pm

  68. ….. half the workforce would be at Centrelink right now.

    ….or, perhaps the same half of the workforce would be at their desks. Maybe happily and proudly doing the job expected of them by an honest, ethical management?

  69. ex-news
    14 Nov 13
    5:53 pm

  70. Wow – there must be a fair few people in this thread working for some amazing humanitarian organisations doing nothing but great deeds for the world.

    either that, or there’s heaps of vicious hypocrites.