Press Release: News Corporation Reports Second Quarter Results for Fiscal 2021
News Corporation Reports Second Quarter Results for Fiscal 2021
FISCAL 2021 SECOND QUARTER KEY FINANCIAL HIGHLIGHTS
News Corporation ("News Corp" or the "Company") (Nasdaq: NWS, NWSA; ASX: NWS, NWSLV) today reported financial results for the three months ended December 31, 2020. Commenting on the results, Chief Executive Robert Thomson said:
"The second quarter of fiscal 2021 was the most profitable quarter since the new News Corp was launched more than seven years ago, reflecting the ongoing digital transformation of the business. We reported the largest profits for Dow Jones since the acquisition of the company in 2007, with Segment EBITDA increasing 43 percent and traffic across the Dow Jones digital network surging 48 percent.
There was also a 77 percent rise in Segment EBITDA at the Subscription Video Services segment, where the exponential evolution at Foxtel continued apace, with streaming customers increasing over 90 percent, rights costs reset and audiences for summer sports at unprecedented levels.
Rapid expansion continued at Move, which accounted for about 80 percent of Segment EBITDA growth in the Digital Real Estate Services segment, while revenue grew 28 percent compared to a year earlier. Realtor.com(R) 's traffic growth has now outpaced that of Zillow for the last 11 months in a row, according to Comscore, and monthly average unique users were 37 percent higher during the quarter compared to the prior year.
In the Book Publishing segment, HarperCollins' revenues rose 23 percent, with double digit growth across every category, and a 65 percent burgeoning of Segment EBITDA. And history was also made at the New York Post, which reported its first profit in modern times -- a notable feat for what had been a chronic loss-making masthead founded in 1801 by Alexander Hamilton."
SECOND QUARTER RESULTS
The Company reported fiscal 2021 second quarter total revenues of $2.41 billion, 3% lower compared to $2.48 billion in the prior year period. The decline was mainly due to lower revenues at the News Media segment, primarily driven by a $191 million, or 8%, negative impact from the divestiture of News America Marketing, weakness in the print advertising market, and a $34 million, or 1%, negative impact from the closure or transition to digital of certain regional and community newspapers in Australia. The decline was partially offset by growth in the Book Publishing, Digital Real Estate Services and Dow Jones segments, as well as a $75 million, or 3%, positive impact from foreign currency fluctuations. Adjusted Revenues (which exclude the foreign currency impact, acquisitions and divestitures as defined in Note 2) increased 2%.
Net income for the quarter was $261 million compared to $103 million in the prior year, reflecting higher Total Segment EBITDA, as discussed below, and higher Other, net, partially offset by higher tax expense.
The Company reported second quarter Total Segment EBITDA of $497 million, a 40% increase compared to $355 million in the prior year. The increase was primarily due to the strong performance at key segments, driven by a combination of improved operating trends and cost reductions, as well as an $18 million, or 6%, positive impact from foreign currency fluctuations. Adjusted Total Segment EBITDA (as defined in Note 2) increased 39%.
Diluted net income per share attributable to News Corporation stockholders was $0.39 as compared to $0.14 in the prior year.
Adjusted EPS (as defined in Note 3) were $0.34 compared to $0.18 in the prior year.
Digital Real Estate Services
Revenues in the quarter increased $45 million, or 15%, compared to the prior year, including a $12 million, or 4%, positive impact from foreign currency fluctuations. Segment EBITDA in the quarter increased $24 million, or 20%, compared to the prior year, primarily due to $19 million of higher contribution from Move and a positive impact of $7 million, or 6%, from foreign currency fluctuations. Adjusted Revenues and Adjusted Segment EBITDA (as defined in Note 2) increased 11% and 19%, respectively.
Move's revenues in the quarter increased $34 million, or 28%, to $155 million, primarily as a result of higher real estate revenues. Real estate revenues, which represented 83% of total Move revenues, grew $30 million, or 30%, due to the continued strength in the referral model and the recovery in the traditional lead generation product, both benefiting from an over 30% increase in average monthly lead volume and higher transaction volume. The referral model also benefited from higher average home values and generated approximately 30% of total Move revenues. The traditional lead generation product saw continued strong demand from agents, driving increased sell-through and yield. Based on Move's internal data, average monthly unique users of realtor.com(R) 's web and mobile sites for the fiscal second quarter grew 37% year-over-year to 80 million.
In the quarter, revenues at REA Group increased $11 million, or 6%, to $184 million, primarily driven by a $12 million, or 7%, positive impact from foreign currency fluctuations. The modest revenue declines in the commercial and Asia businesses were offset by growth in Australian residential depth revenues. Australian national residential listing volumes in the quarter increased 10% compared to the prior year as more markets recovered with the relaxation of government restrictions, with listings in Melbourne and Sydney up 25% and 13%, respectively.
Subscription Video Services
Revenues in the quarter increased $10 million, or 2%, compared with the prior year, reflecting a $33 million, or 7%, positive impact from foreign currency fluctuations and higher revenues from OTT products. The revenue increase was partially offset by the impact from fewer residential broadcast subscribers and an $11 million, or 2%, negative impact from lower commercial subscription revenues resulting from the ongoing restrictions on pubs, clubs and other commercial venues due to COVID-19. Adjusted Revenues decreased 5% compared to the prior year.
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February 04, 2021 16:40 ET (21:40 GMT)