News Corp global revenues increase thanks to Foxtel consolidation

News Corp has reported revenues of US$2.46bn in the third quarter of financial year 2019, a 17% increase on the year prior.

The company is reporting the growth is partially thanks to the consolidation of Foxtel and Fox Sports. In 2018 it was announced that Foxtel and Fox Sports would be merged. Prior to that, News Corp owned 100% of Fox Sports and had a 50% in Foxtel as a joint venture with Telstra.

Under the new deal, News Corp owns 65% of the consolidated business with Telstra holding 35%.

With the inclusion of Foxtel, News Corp reported an increase in revenue by US$410m in the subscription video services sector and an EBITDA (earnings before interest, tax, depreciation and amortisation) increase of $82m.

As of March 31, 2019, Foxtel’s subscribers were 2.896m, higher than the year prior in part due to the launch of Kayo and growth in Foxtel Now. As of May 8, 2019, there were 239,000 Kayo subscriptions, 209,000 of which are paid.

Pro forma segment EBITDA in the quarter decreased 23%, US$29m, compared with the previous year due to increased costs of sports programming and production costs related to Cricket Australia as well as higher marketing costs associated with Kayo.

News Corp reported a decrease in revenues in the news and information services sector, down US$62m or 5%, with 4% of that due to negative impact from foreign currency fluctuations. Dow Jones grew 1% while News UK and News America Marketing declined 8% and News Corp Australia declined 7%.

Dow Jones saw a 7% increase in circulation revenues with 19% growth in digital paid subscriber growth and a subscription price increase at The Wall Street Journal. Print volumes declined in both Australia and the UK, which offset the overall growth in the sector.

Closing digital subscribers at News Corp Australia as of March 31, 2019 were 493,200 compared to 409,000 the year prior.

News Corp’s local titles include The Australian, Sydney’s Telegraph titles, Victoria’s Herald-Sun and Brisbane’s Courier Mail.

The company reported growth in its book publishing sector, partially thanks to higher sales in Christian publishing. Revenues increased by 6% to US$23m, with a negative impact of $9m from currency fluctuations.


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