NEWS Corporation has reported 2010/11 second quarter earnings broadly in line with market expectations as its global stable of television channels continued to expand and provide the bulk of the company's earnings.
News Corp reported net income (net profit) of $US642 million ($637.6 million) for the three months to December 31, 2010, up 152.8 per cent from $US254 million ($252.26 million) in the prior corresponding period, the company said.
The result included a $275 million pre-tax charge for impairment of goodwill related to the Digital Media Group and the organisational restructuring at MySpace, News Corp said in a statement.
Second quarter total segment operating income, or earnings before interest and tax (EBIT) was $US1.29 billion ($1.28 billion), up 81.2 per cent from $US712 million ($707.12 million) reported a year ago.
"This growth reflects significant profit increases at the Cable Network Programming and Television segments, partially offset by decreases at the Filmed Entertainment and Other segments," News Corp said in a statement.
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The prior year's result included a one-time litigation settlement charge of $US500 million ($496.57 million).
Market consensus was for News Corp to report EBIT in the vicinity of $US1.27 billion ($1.26 billion) in the second quarter of 2010/11, according to Reuters' data.
News Corp chairman and chief executive Rupert Murdoch said the second quarter results demonstrated the "mounting vigour of our global channels business".
"I am confident that the significant positive momentum from these businesses will not only continue to drive News Corporations growth for the remainder of the fiscal year, but also strengthen the company for growth in the years to come," Mr Murdoch said in the statement.
The media group owns news agency Dow Jones, 20th Century Fox movie studios, MySpace, Sky Italia and newspapers in Australia, the UK, the US and elsewhere, among other properties.
Mr Murdoch said News Corp's US cable television channels were expanding and adding subscribers, with revenue and profits increasing "at a double-digit pace on the strength of affiliate fee increases and buoyant advertising markets".
"I am also pleased with the continued recovery of our US broadcasting business, including our local TV stations and the Fox Broadcasting Company, which posted its best quarterly profit in two and a half years," Mr Murdoch said.
"Momentum at our international businesses is equally brisk."
Mr Murdoch said international channel revenues were up 20 per cent in the quarter, supported by a strong performance in Latin America and India.
Meanwhile, Sky Italia was "back on track", Mr Murdoch said, after achieving its highest quarterly net subscriber additions in the past two years.
Total revenue grew by 0.9 per cent to $US8.761 billion ($8.7 billion), News Corp said.
News Corp's cable network programming continued to produce the bulk of the company's earnings, posting operating income, or EBIT, of $US735 million ($729.96 million) in the quarter, up 22 per cent from the prior corresponding period.
This was despite the adverse impact of a distribution contract renewal dispute in the US.
Advertising revenue among its US cable channels rose 12 per cent in the quarter from a year ago due to volume and pricing strength, News Corp said.
Advertising revenue for international channels grew 27 per cent, the company said, "primarily due to improving ad markets and stronger viewership trends, led by our STAR channels".
News Corporation is the parent company of News Limited, which owns the publisher of news.com.au.
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