MAIN NEWS HEADLINES
May 15 – May 22, 2008 Edition
For Third Quarter
NEW YORK, NY/5/12/08–News Corporation (NYSE: NWS, NWSA; ASX: NWS, NWSLV) last week reported third quarter net income of $2.7 billion ($0.91 per share) as compared with $871 million ($0.27 per share on a diluted combined basis1) reported in the third quarter a year ago. The company’s publishing unit, HarperCollins, reported third quarter operating income of $29 million, in-line with the same period a year ago, and total sales at HarperCollins increased 3.8% for the period ending March 31.
HarperCollin’s current quarter included strong sales of Naughty Neighbor by Janet Evanovich, Stop Whining, Start Living by Dr. Laura Schlessinger, Lady Killer by Lisa Scottoline, Fancy Nancy, Bonjour Butterfly by Jane O.Connor and The Chronicles of Narnia: Prince Caspian by C.S. Lewis. During the quarter, HarperCollins had 54 books on The New York Times bestseller list, including 4 titles that reached the #1 spot.
News Corporation’s year-on-year growth reflects an increase in Other, netv of $1.6 billion primarily reflecting a $1.7 billion tax-free gain on the asset and stock exchange with Liberty Media Corporation. Additionally, increases in consolidated operating income partially offset by lower equity earnings contributed to the improved results.
Consolidated operating income for the third quarter of $1.4 billion was up 16% versus the $1.2 billion reported a year ago, primarily driven by double-digit percentage increases at the Television, Cable Network Programming, Newspapers and Information Services and Other segments.
Third quarter net earnings from affiliates were $109 million versus $255 million reported in the same period a year ago. The $146 million decrease was primarily driven by lower contributions from BSkyB due to the write-down of its ITV investment and by a decrease in contributions from The DIRECTV Group as a result of the Company.s exchange with Liberty Media Corporation in February 2008.
Commenting on the results, Chairman and Chief Executive Officer Rupert Murdoch said: "Our 16% revenue and operating income growth this past quarter is a great illustration of how the diversity of our asset base is translating into sustained financial success. We delivered growth from advertising based businesses, such as our television stations and broadcast network, and we delivered growth from subscription based businesses, such as our domestic cable channels. We delivered growth from established businesses, such as our newspapers and we delivered growth from our developing assets, such as our international cable channels and Fox Interactive Media. Our ability to generate returns from a multitude of sources puts us in a great position to maintain our financial momentum even in times of economic uncertainty."
HarperCollins CEO Jane Friedman attributed the lackluster performance to softness in the Christian Book unit. She said its Zondervan division is undergoing a complete review, as more religious books are selling through general retailers instead of Christian book channels.
Friedman said she believes the fiscal 2008 year will end on a strong note.