Rupert and Lachlan Murdoch: “We demonstrated strong operational momentum across our global businesses”
21st Century Fox has reported financial results for the three months ended 30 September 2016.
The company reported quarterly income from continuing operations attributable to stockholders of $827 million ($0.44 per share), as compared to $678 million ($0.34 per share) reported in the prior year quarter. (All figures in US dollars.)
The company reported total quarterly revenues of $6.51 billion, a $429 million, or 7%, increase from the $6.08 billion of revenues reported in the prior year quarter. This increase primarily reflects higher affiliate and advertising revenues generated at the Cable Network Programming segment and higher content revenues generated at the Filmed Entertainment segment. The adverse impact of foreign exchange rates impacted quarterly revenue growth by $77 million.
Commenting on the results, executive chairmen Rupert and Lachlan Murdoch said:
“We delivered a strong quarter, growing our earnings by double digits on solid revenue gains. Whether it was Fox News rating #1 in basic cable, the 27 primetime Emmy Awards between FX Networks and Fox Broadcasting, producing three of the top five scripted shows on television, or our robust international growth, we demonstrated strong operational momentum across our global businesses.”
Cable Network Programming quarterly segment OIBDA increased 6% to $1.38 billion, driven by a 10% revenue increase on higher affiliate and advertising revenues partially offset by a 12% increase in expenses. The increase in expenses was primarily due to higher international sports programming costs in Latin America and India due to the broadcast of the Rio Olympics, higher Major League Baseball sports rights costs at the regional sports networks (“RSNs”) and higher entertainment programming costs at FX Networks.
Television generated quarterly segment OIBDA of $191 million which was 3% lower than the prior year’s corresponding result. Quarterly segment revenues were 1% lower than the prior year quarter as lower advertising revenues, reflecting a market shift in advertising spending towards the Rio Olympics and the absence of the prior year broadcasts of the Emmy Awards and the FIFA Women’s World Cup final, were offset by higher retransmission consent revenues, higher local political advertising spending at the television stations and higher content revenues at the Fox Broadcast Network.
Filmed Entertainment quarterly segment OIBDA of $311 million more than doubled from the $149 million reported in the same period a year-ago. The OIBDA increase was driven primarily by increased contributions from the film studio reflecting lower theatrical releasing costs, the worldwide theatrical performance of Independence Day: Resurgence, the home entertainment performance of Deadpool and higher contributions from the television production business led by the subscription video-on-demand licensing of Homeland to Hulu. Quarterly segment revenues increased $122 million to $1.91 billion, primarily reflecting higher television production revenue.
Quarterly equity earnings of affiliates of $35 million were equal to the amount reported in the same period a year-ago as improved results at Endemol Shine Group and Tata Sky were offset by lower equity earnings for Sky and increased losses at Hulu. The decrease in equity earnings from Sky was a result of the strengthening of the US dollar against the pound sterling.