21st Century Fox profits down 49% as a result of acquisitions | Media | theguardian.com
Rupert Murdoch's entertainment giant posts higher than expected revenue, boosted by Sky Deutschland stake

21st Century Fox said on Thursday that its fiscal second-quarter profits dropped 49%, largely as a result of acquisition costs, but still matched Wall Street predictions.

The media and entertainment giant controlled by Rupert Murdoch also posted significantly higher than expected revenue, helped by its acquisition of a controlling stake in German satellite TV operator Sky Deutschland in January 2013.

As a result of that acquisition, revenue at the company's satellite TV division jumped 66% to $1.52bn. Meanwhile, revenue from its cable network programming increased 14% to $2.96bn, helped by other acquisitions and higher rates at US TV stations.

Revenue at the company's film division increased 7% to $2.48bn on better TV production results that stemmed from the syndication of the comedy series Modern Family and higher revenue from the drama Homeland. But the division wasn't as profitable as it was a year ago, when its results were boosted by the theatrical and home viewing releases of popular movies.

For the quarter ended 31 December, 21st Century Fox posted profits of $1.21bn, or 53 cents per share, down from $2.38bn, or $1.01 per share, in the same quarter the year before.

The recent quarter's results included expenses related to the company's acquisition of a controlling stake in Sky Deutschland in January 2013. Excluding one-time items, the company posted an adjusted profit of 33 cents per share.

Revenue rose 15%, to $8.16bn from $7.11bn.

Analysts, on average, expected a profit of 33 cents per share on $7.87bn in revenue, according to FactSet.

The results marked Twenty-First Century Fox's second quarter as a separate entity from publishing company News Corp, which was spun off at the end of June 2013. Both entities remain controlled by Murdoch, chief executive of 21st Century Fox and executive chairman of News Corp.

Shares of the New York-based company rose 87 cents, or 2.8%, to $32.02 in early trading.