News Corp shares gain as Q2 result beats estimates
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More news: News Corp shares jumped in early trading after the media company beat estimates for the second quarter.
News Corp shares were up 3.9% to $55.30 by 10:30am AEDT, extending gains of more than 40% over the last 12 months.
Jarden called it a "strong result all round", with group EBITDA beating consensus estimates by 11%.
UBS said that the headline result was a "solid beat driven across every segment", noting New Corp's 25% free cash flow growth "should be well received".
E&P Capital analyst Entcho Raykovski flagged Q2 revenue of $3.6 billion was 3% ahead of average forecasts.
What they said: "We’d expect the stock to outperform the market today," Raykovski said.
News Corp CEO Thomson flags ongoing review of corporate structure post-Foxtel
More news: News Corp’s global chief executive Robert Thomson told analysts on the company’s second quarter earnings call that the Murdoch-controlled media conglomerate continues to review its corporate structure.
What they said: “We are constantly reviewing the structure of the company, and, look it is fair to say that the Foxtel deal itself is hard evidence of that, that our consideration of the appropriate structure does not end with that significant decision," Thomson said during the Q&A portion of the call.
"But there is no doubt that we have a collection of very valuable assets.”
News Corp books 5% revenue boost driven by real estate, Dow Jones
The news: News Corp has reported a 5% second quarter revenue increase to USD2.24 billion ($3.56 billion), excluding Foxtel, driven by strong performances in its digital real estate and Dow Jones publishing segments.
The numbers: Net income from continuing operations for the second quarter was USD306 million, up 58% on the USD194 million the previous year, while total segment EBITDA was up 20% to USD478 million.
Earnings per share from continuing operations was USD0.40, up on the USD0.28 reported a year earlier. Adjusted earnings per share was USD0.33.
The context: The quarter saw REA Group post record revenues of USD343 million, the company said in a statement on Thursday, up 17% on the prior year. News Corp said Dow Jones also booked record revenues for the quarter of USD600 million.
News Corp’s book publishing business, meanwhile, booked 8% revenue growth, while segment EBITDA was up 19%.
The company also announced the sale of Foxtel to the global sports streaming platform, DAZN, for an enterprise value of $3.4 billion.
What they said: “News Corp had a fruitful quarter, qualitatively and quantitatively,” News Corp’s global chief executive Robert Thomson said in a statement on Thursday.
“The three pillars of growth — Digital Real Estate, Dow Jones and Book Publishing — continued to expand segment EBITDA robustly. We also saw the positive impact of rigorous cost discipline and digital development in the News Media segment, and our overall margin rose meaningfully compared to the prior year.
“With a keen eye on those core areas of growth, we took a significant step towards simplification with the agreement to sell Foxtel to DAZN, a premier global sports streaming provider, for a total enterprise value of $3.4 billion.
"The agreement is tangible recognition of Foxtel’s successful digital transformation, and should surely benefit our shareholders, our partners at DAZN and all Australian sports fans.”
The sources: ASX announcement, UBS research, Jarden research, E&P Capital research
