Fox Corporation said net income in its fiscal fourth quarter tumbled despite only a slight decline in revenue after the company exited a multi-year rights agreement with the U.S Golf Association and grappled with conditions set by the coronavirus pandemic.
The owner of Fox News Channel, Fox Broadcasting and Fox Sports, said net income during the period came to $122 million, or 20 cents per share, compared with $454 million, or 73 cents per share in the year-earlier period. Excluding one-time items, Fox said earnings would have come to $375 million or 62 cents per share for the period.
Revenue in the period was off 4% to $2.42 billion, compared with $2.51 billion a year earlier. The company cited an 8% increase in fees from cable and satellite distributors that was offset by a 22% decrease in advertising revenue due to lower activity and its local TV stations, fewer live sports broadcasts and fewer hours of scripted programming to show on Fox Broadcasting.
“Fox delivered strong results for the fourth quarter and full fiscal year, even in spite of the unprecedented environment in which we all continue to operate, underscoring the strength of our brands and content offering,” said Lachlan Murdoch, the company’s executive chairman and CEO, in a prepared statement. “We entered the COVID-19 crisis on sound operational and financial footing and we expect to emerge from this pandemic more competitive, more focused and even more strongly positioned to deliver value for our viewers, partners and shareholders in the years ahead.”
Fox in June terminated a rights pact with the U.S. Golf Association that was supposed to have lasted from 2015 to 2027, with annual payments said to be around $93 million – well in excess of the $37 million per year that had been paid by previous rights holders ESPN and NBC Sports. But ratings for the league’s golf events proved to be underwhelming to Fox executives.
Revenue fell $28 million, or 2%, at the company’s cable segment, but those trends were partially offset by higher advertising and other revenue at Fox News Media, the unit that comprises Fox News Channel and Fox Business Network. Fox said affiliate revenue in the cable unit rose $9 million, owing to contractual price increases. Revenue fell $70 million, or 6%, in the company’s broadcast unit.