Rupert Murdoch singled out Fox Filmed Entertainment Group’s mega-blockbuster Avatar for praise today when his News Corp reported its greatly improved 2nd-quarter earnings. “We have a strong management team that knows how to nurture our core businesses, while taking prudent, creative risks like Avatar that lead the industry forward,” he said in a statement. “I have every confidence that News Corporation is entering a new period of sustained growth.” And the bulk of the Avatar box office isn’t even included in this quarter since it came out on December 18th. But the film’s launch costs are. (Previously, News Corp’s 2nd biggest shareholder said publicly that Avatar would “add $400M to News Corp’s bottom line…”)
As the first of the Big Media companies to report earnings, there were encouraging signs, especially the improvement in the advertising climate, which bodes well for the media sector in general. News Corp saw growth in earnings and revenue in its filmed entertainment and television and cable television business. The company reported 2nd-quarter total revenue growth of 10% to $8.7 billionas a result of double-digit percentage growth at the majority of business segments as compared to the same period a year ago.
Excluding a one-time $500 million pre-tax charge (related to the settlement of litigation filed against the Company’s Integrated Marketing Services business), News Corp reported total segment operating income of $1.2 billion. That was an increase of 44% compared with segment operating income of $839 million reported a year ago. These results reflected growth at the Filmed Entertainment, Television, Cable Network Programming, Newspapers and Information Services and Book Publishing segments, partially offset by decreases at the Direct Broadcast Satellite Television and other segments, the company stated.
“Our strong top-line revenue growth demonstrates that News Corporation is emerging from this recession with renewed vigor and strength,” News Corp chairman and CEO Rupert Murdoch said in a statement. “Moreover, our underlying operating trends this quarter far outpace those of the same quarter last year. We continue to reap the benefits from the restructuring and cost containment measures we instituted before the downturn began, and I am pleased that our unrelenting focus has translated to growth across our businesses that will reward stockholders for years to come.”