News Corporation, Rupert Murdoch’s sprawling media empire, reported a fiscal fourth-quarter loss of $203 million, compared to a profit of $1.1 billion last year.
The loss was attributed to the one-two punch of the recession and prolonged advertising slump that have hit its newspaper, film, television, and Internet businesses.
News Corp’s revenue slid 11 percent $7.67 billion.
“The last year has been one of the hardest in history,” Rupert Murdoch said in the company’s conference call on Wednesday. “I think the worst is behind us. I am certain that News Corp is poised to profit and deliver strong returns, as the economy rebounds."
Murdoch also revisited his plan to start charging consumers for content on the company’s news sites. He said News Corp execs would be implementing the plan by 2010. Murdoch was joined by newly-returned President, COO and Deputy Chairman Chase Carey, who said the conglomerate is looking to build multiple revenue streams.
“The industry seems to be in a state of shock,” Carey said. “Nonetheless, there are opportunities to maximize” the values of News Corp’s businesses and new models to pursue. “On the broadcast side, we have an ad-supported model that doesn’t work,” he said.
Fox Interactive Media, which includes MySpace, reported a full year operating loss of $363 million, down $279 million, due mainly to advertising losses at MySpace and the costly launch of MySpace Music.
“We have a tough few months ahead,” Murdoch said. The company told shareholders that it expects most of its growth to occur “during the last three quarters” of its 2010 fiscal year.
On the film side, operating income fell to $203 million from $220 million, even as revenue rose to $1.72 billion from $1.52 billion.
Fox Television reported full year operating income of $174 million — down 85 percent from the year before, due, in part, to the shift in schedule for "24" as a result of the Writers Guild Strike. Fox News increased revenues by 50 percent for the year. "It’s been the top rated cable news channel for 90 months in a row," Murdoch boasted.
Its newspapers division – which includes the Wall Street Journal and New York Post — reported full-year operating income of $466 million, down $320 million over fiscal 2008, driven down by lower advertising.
When asked about additional restructuring, Murdoch said he did not want to compromise the quality of his publications, including the Wall Street Journal and Times of London. “Quality journalism is not cheap,” he said. “Our policy is to win,” he said.
Murdoch said that the success of WSJ.com has proven to him that he can charge for content online, and thinks the pay model can be transferred across all of News Corp.’s Web properties.
News Corp’s book publishing division, which includes Harper Collins, reported full-year operating income of $17 million, $143 million less the previous year. The freefall was due to a “weak retail market.”
For the full fiscal year, News Corp’s adjusted operating income fell 32.5 percent. The net loss was $3.4 billion, compared to net income of $5.4 billion.
Murdoch said the company is "very, very" excited about the holiday release of
James Cameron’s 3-D "Avatar."
