News Corp details plans to spin off $2bn 'loss-making' publishing arm
RUPERT Murdoch's News Corp said the publishing arm it plans to spin off from its entertainment assets would have lost $2.1bn in the last fiscal year if it were a standalone company.
News Corp filed with the US Securities and Exchange Commission yesterday to separate its publishing and entertainment assets into two publicly traded companies.
News Corp first announced the decision in June after shareholders pressed it to get rid of its troubled newspaper unit.
"New News Corp," as the company dubs its publishing wing, will include newspapers, information marketing services, digital real estate, book publishing, digital education, and sports programming and pay-TV distribution in Australia, the company said yesterday.
News Corp's film and television businesses include the 20th Century Fox film studio, Fox broadcasting network and Fox News channel, which will be part of the renamed parent company that will be called Fox Group.
The loss included an impairment charge of around $2.6bn, News Corp said in a filing, but it added that revenue fell 5pc, hit by the 2011 closure of the 'News of the World' paper after the UK phone hacking scandal, and lower revenues at its Australian papers.
The $2.08bn annual loss compares with a profit of $678m a year earlier. The unit would have reported a net loss of $92m in the three months that ended September 30, hurt by lower advertising revenue and higher operating costs, it said.
The filing shows the publishing unit's earnings before interest, taxes, depreciation and amortisation or EBITDA, a figure used by Wall Street to reflect the company's operating performance, slipped to $782m in 2012 from $1.21bn in 2011.
The publishing division now includes the HarperCollins book publisher, its education arm headed by former New York schools chancellor Joel Klein, and newspapers, including 'The Wall Street Journal', 'The Times' of London, 'The Sun', 'The New York Post' and 'The Australian'. (Reuters)