Film and cable programming gains powered 21st Century Fox to strong earnings and revenue gains in the fiscal fourth quarter, despite a big decline at the Fox network from the collapse of “American Idol.”
Fox reported revenue of $8.42 billion, a 17% gain over the year-ago quarter powered by stronger contributions from the film division.
Operating income climbed 17% to $1.77 billion.
Net income for the fourth quarter dipped to $966 million, or 43 cents per share, compared with $977 million in the year-ago quarter. Fox cited higher costs from depreciation expenses associated with Fox’s taking majority stakes in Sky Deutschland and the YES network for the decline, which was offset by a $50 million gain from Fox’s share of BSkyB’s stock buyback program.
Regarding the company’s failed plans to buy Time Warner for $80 billion, “we have moved on,” said company chief operating officer Chase Carey during a call with analysts to discuss the quarterly results, with Fox-chief Rupert Murdoch adding, “this is our resolute decision,” also during the call.
Carey criticized Time Warner’s board, calling them “highly defensive” of the merger talks and was adamant that Fox no longer had plans to go after its rival. “Let me be clear: we are done,” he said, adding that the company also wasn’t interested in pursuing other companies, either.
Neither did Murdoch. “We have no plan to go out on the acquisition trail. All of our best businesses, we’ve built them ourselves.”
At the cable networks wing, regional sports nets powered gains of 6% in operating income, which reached $4.41 billion. However, some of the growth in affiliate free revenue was offset by higher costs related to recent channel losses and the consolidation of Fox’s ownership stake in the Yes Network, and other regional cablers. Operating income was also hit by exchange rate fluctuations in Latin America and India, Fox said.
Domestic affiliate revenue grew 14% while international revenue spiked 19% thanks to gains at the Fox International Channels unit and satcaster Star. Advertising revenue grew 8% for the quarter.
Fox’s filmed entertainment unit saw its operating income nearly triple from year-ago, to $339 million, thanks to “X-Men: Days of Future Past,” “Rio 2” and “The Fault in Our Stars.” Syndication and licensing coin from “Modern Family” and the reboot “24: Live Another Day” also plumped the division’s coffers.