News Corp. 4Q Results Top Views, Dividend Raised
News Corp.s (NASDAQ: NWSA) quarterly earnings easily beat analysts expectations in the companys first report since a phone hacking scandal rocked Rupert Murdochs global media empire.
News Corp. reported fiscal fourth quarter income from continuing operations of $982 million, or 35 cents a share, compared to $902 million, or 33 cents share, in the same quarter a year ago. Revenue came in at $8.96 billion, up from $8.11 billion a year ago, boosted by solid growth at the company's cable TV networks.
Wall Street analysts had predicted profit of 30 cents per share on revenue of $8.5 billion.
News Corp. also raised its annual dividend to 17 cents from 15 cents. For the six months, the company declared a 9.5 cent dividend for both Class A and Class B shares.
It was the first quarterly report from the New York-based media conglomerate in the wake of a phone hacking scandal that led News Corp. to close its oldest newspaper holding, the British weekly tabloid News of the World.
Allegations that reporters and editors conspired with police to hack the phones of celebrities and politicians in search of salacious scoops forced the resignations of several high-placed News Corp. executives, a handful of whom were arrested.
Fallout from the scandal also led to an appearance by Rupert Murdoch and his son James, also a top News Corp. executive, before a parliamentary committee to answer questions about what they knew about phone hacking at News of the World and when they knew it.
The scandal has led some investors to question whether News Corp. has a succession plan in place for the 80-year-old Murdoch, and whether perhaps that plan should be implemented sooner rather than later.
One investor group, which reportedly owns 700,000 non-voting shares of the company and is represented by the Interfaith Center on Corporate Responsibility, is calling on News Corp. to split the job of CEO and Chairman, among other changes, according to Bloomberg News. Both posts are currently held by Rupert Murdoch.
Murdoch addressed the scandal in a statement: While it has been a good quarter from a financial point of view, our company has faced challenges in recent weeks relating to our London tabloid, News of the World. We are acting decisively in the matter and will do whatever is necessary to prevent something like this from ever occurring again, he said.
Murdoch added that the scandal has had no material impact on the rest of the company. Our broad, diverse group of businesses across the globe is extremely strong today, he said.
During an earnings conference call with investors and media after the results were released Wednesday, Murdoch said News Corp.s board of directors wants him to remain as chairman and chief executive.
The board believe I should continue in my current role as chairman and CEO, he said. But make no mistake, (News Corp. COO) Chase Carey and I run this company as a team.
The quarter included a one-time loss of $254 million, or 10 cents a share, related to the sale of struggling social networking site Myspace.
After one-time expenses, the company posted a fourth-quarter profit of $683 million, or 26 cents a share, down from $875 million, or 33 cents a share, a year-ago.
News Corp. is the parent company of FOXBusiness.com.