Rupert Murdoch's News Corp. is in the headlines again, this time for its Wednesday announcement of a $1.6 billion quarterly loss in its fiscal fourth quarter following the writedown of its global publishing empire.
The net loss for the April to June quarter was 64 cents a share. That compared with a $683 million net income, at 26 cents a share, for the fourth quarter of fiscal 2011.
The company attributed most of the losses to a $2.9 billion pretax impairment and restructuring charge linked to its publishing assets, as well as a $15 million pretax loss.
Discounting the writedowns and other items, profit stood at 32 cents a share, still in line with the average that most analysts estimated.
Net income during the fiscal fourth quarter hit $1.2 billion, down by $167 million from the same period a year ago.
Revenue dropped by 6.7 per cent to $8.4 billion. Analysts had projected $8.72 billion.
News Corp. derives much of its value from its entertainment operations, the Fox News cable network and the Twentieth Century Fox film studio.
In June, Mr Murdoch revealed a plan to split off its declining publishing division into a separate public company. The spinoff is expected to take a year to complete.
Profit from its publishing business dove 31 per cent to $597 million, attributed to declining advertising revenue at the Australian newspapers plus the shutdown of the News of the World newspaper, the company said.
Its cable business, on the other hand, performed well, as operating profit jumped 26 per cent to $792 million, supported by the growth in advertising and the fees received from pay-TV operators.
Shares of News Corp. dropped as much as 4.2 per cent to $22.72 in extended trading following the release of the report. Shares had grown 33 per cent this year, bolstered primarily by the business break-up plan.
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