News Corp revenues down 4pc on volatile currency

News Corp revenues down 4pc on volatile currencyPhoto: Alex Proimos

News Corp has posted revenues of $US2.16 billion for the second quarter, a drop of 4 per cent from the previous corresponding period, despite a lift in real estate division revenues.

Again the company’s earnings have been buffeted by currency fluctuations, with a negative impact of around $US141 million. If the impact of currency movements is excluded, revenues would have increased by 2 per cent, the company said.

Revenues from the News and Information Services division were down $US123 million, or 8 per cent, compared to the previous year.

Total segment advertising revenues declined 12 per cent, primarily due to weakness in print advertising, lower revenues at News America Marketing – and currency fluctuations.

This was partially offset by growth in digital advertising revenues, including at Dow Jones, where digital revenues accounted for around one-third of advertising revenues in the quarter.

Circulation and subscription revenues declined 5 per cent, also hit by currency movements. Growth in paid digital subscribers in the US and Australia, higher subscription pricing and selected cover price increases offset print volume declines and the impact from the change in the digital strategy at The Sun, in Britain.

News Corp chief executive Robert Thomson was enthusiastic over the growth of digital advertising and subscriptions. In Australia, digital subscriptions have risen by 30 per cent year on year, and revenues from digital subscribers are now close to offsetting print volume declines.

Mr Thomson said, however, that print advertising remained challenged.

“We are particularly focused on cost reductions and sharing services around News Corp to streamline operations at the newspapers in Australia and the UK,” he said.

Revenues for Digital Real Estate Services in the quarter increased $US54 million, or 35 per cent, compared to the prior year, primarily driven by the inclusion of the results of Move, acquired in November 2014.

REA released figures for the December half-year to the Australian Stock Exchange today that showed revenue growth of 20 per cent in local currency on the prior half year to $314.8 million, an increase in EBITDA of 29 per cent to $185.9 million, and net profit growth of 28 per cent to $121.0 million.

Cable network programming revenues decreased $US6 million, or 5 per cent, compared to the prior year. Adjusted revenues increased 10 per cent, primarily due to higher affiliate and advertising revenues.

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