News Corp’s shares jump on strong results
The company’s Australian shares closed almost 6 per cent stronger on Thursday in the wake of the media giant’s solid performance in the three months to December 31.
Business
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News Corporation was the standout performer on the local sharemarket on Thursday after the company reported bumper second-quarter results, with the performances of its “three pillars” – digital real estate, book publishing and Dow Jones – exceeding market expectations.
The company’s shares rose $3.07 or 5.8 per cent to $56.28 in the wake of the media giant’s strong performance in the three months to December 31.
The company recorded revenue of $US2.24bn ($3.58bn), up 5 per cent from the same period a year earlier.
News Corp booked net income from continuing operations of $US306m, up 58 per cent.
That figure excluded income from Foxtel, following News Corp’s agreement to sell the broadcasting giant to DAZN.
Of that deal, News Corp chief executive Robert Thomson said: “With a keen eye on our innate strengths, we took a significant step towards simplification with the agreement to sell Foxtel to DAZN … for a total enterprise value of $3.4bn, or approximately seven-times Foxtel’s fiscal 2024 EBITDA (earnings before interest, taxes, depreciation, and amortisation).
“The agreement is a tangible recognition of Foxtel’s successful digital transformation, and should surely benefit our shareholders, our partners at DAZN and all Australian sports fans.
“We expect the transaction to close in the second half of the current fiscal year, subject to regulatory approvals and other customary closing conditions.”
Elsewhere, digital real estate revenue increased 13 per cent to $US473m, with REA’s revenues for the quarter surging 17 per cent to a record $US343m.
“The company (REA) achieved a quarterly record in revenue – while extending its audience leadership and reinforcing its position as Australia’s pre-eminent property site,” he said.
REA achieved 129 million average monthly visits during the second quarter, almost four times its nearest competitor on average.
At Dow Jones (publisher of The Wall Street Journal), revenue grew 3 per cent to $600m, while book publishing reported yet another strong quarter, with revenue expanding 8 per cent to $US595m.
“News Corp had a fruitful quarter, qualitatively and quantitatively,” Mr Thomson said. “The three pillars of growth – digital real estate, Dow Jones and book publishing – continued to expand segment EBITDA robustly.
“We also saw the positive impact of rigorous cost discipline and digital development in the news media segment, and our overall margin rose meaningfully compared to the prior year.
“In a world in which so many media companies and mastheads are in terminal decline, our business is thriving, thanks certainly to the diligent and creative work of our talented teams, and the savvy, strategic guidance of Lachlan and Rupert Murdoch, and our astute board of directors.”
Mr Thomson observed that there had been a “tangible increase in business confidence here in the US since the election, the temporary turmoil of transactional tariffs aside”.
News Corp is the publisher of The Australian.
Originally published as News Corp’s shares jump on strong results
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