NewsCorp ‘Firing On All Cylinders’, Boasts Murdoch

14 August 2003

News Corporation, the global media empire controlled by the clan Murdoch, on Wednesday surged out of the red with a 26% rise in operating profits for the quarter ended June 30 – the final period of its fiscal year.

Fiscal Q4 saw operating income rise to $570 million (€503.59m; £353.62m) on revenues up 20% to $4.59 billion. Net profit was $370m versus a year-on-year net loss of $1.74bn – attributable largely to a $4.1 billion writedown of its controlling stake in Gemstar-TV Guide.

The result reflects an even performance across most of the Murdoch portfolio, not least overseas assets such as UK satellite TV operator BSkyB and Star TV in Asia. Commented one entrail-raker, Richard Greenfield of Fulcrum Global Partners: “The non-Fox assets are going to have stronger growth than Fox.”

Nonetheless, the most muscular profits growth came from the Fox division and its so-called ‘reality’ hits American Idol and Joe Millionaire. These in turn boosted ratings for other Fox output to generate a Q4 profit of $29m, against a $60m loss in the same period last year.

Boasted Murdoch of his global fiefdom: “[It is] a company firing on all four cylinders.” But he was less ebullient over the recent decision by the US House of Representatives to overturn the FCC’s relaxation of the media ownership rules – a move likely to thwart NewsCorp's expansionist ambition in US network television.

“We believe this great feeling in the Congress against the [broadcast ownership] cap is based on a load of ignorance,” growled the mogul.

However, he detected “no signs the antipathy towards media consolidation” would threaten his current acquisition of a controlling stake in Hughes Electronics, parent of America’s largest satellite operator DirecTV. He was “very hopeful” regulators would approve the deal by the year end.

Data sourced from: Financial Times; additional content by WARC staff