Restructuring charges push News Corp into the red

Rupert Murdoch’s News Corp has posted a loss for the fourth quarter after taking $2.85 billion (£1.8bn) of restructuring and impairment charges that overshadowed growth at its cable networks.

The media giant, which is facing ongoing legal charges over the phone-hacking scandal, reported a loss of $1.6bn for the three months to the end of June, compared with a $683 million profit a year earlier.

Publishing profits fell to $139m, from $270m last year, and the company’s full-year results included a $224m charge related to “the costs of the ongoing investigations initiated upon the closure of The News of the World”. This included a $57m charge in the last quarter.

Commenting on the results, News Corp boss Rupert Murdoch said the company was in a “strong” position that would be enhanced by plans to split the company into two parts – separating its entertainment businesses from publishing assets, including The Sun and The Times.

The move would see the group’s 39 per cent stake in broadcasting giant BSkyB separately listed from the embattled UK newspaper arm News International, which has been the focus of the phone-hacking scandal that led to the closure of the News of the World.

Murdoch said: “We are proud of the full-year financial growth achieved over the last 12 months, led by our cable network programming and filmed entertainment segments.”

At its cable networks, operating profit rose 26 per cent on a 16 per cent increase in affiliate fee revenue from cable, phone and satellite TV distributors. Advertising revenue at its domestic cable channels rose 5 per cent.