21st Century Fox got a huge profit boost from the new tax law, but its operations, except for its cable networks, generated lower operating income.
Second quarter net income was $1.9 billion, or 99 cents a share, up from $936 million, or 46 cents a share a year ago.
The quarter included a $1.34 billion tax benefit, or 72 cents a share. Excluding the tax benefits, 21st Century Fox’s earnings from continuing operations were 42 cents a share, compared to 53 cents a year ago.
Related: Hulu Losses to Jump by More Than $800M
Revenues rose 5% to $1.4 billion.
Operating income at 21st Century Fox’s cable networks group rose 3% to $4.4 billion.
The networks recorded an 11% increase in revenues to $4.4 billion, but costs were up 15% because of higher sports rights payments.
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Domestic affiliate revenue was up 12%. Domestic advertising was down 3% as entertainment ratings fell because of fewer original programs at FX.
Fox News recorded a bigger profit, but the domestic sports networks and National Geographic’s earnings were down.
Operating income fell 85% at the company’s television division. Revenues were down 6% because of lower advertising revenues. Political ad revenues were down in a non-election year, and World Series and NFL ratings were lower, the company said.
Television costs were up because of a higher volume of college football and NFL games during the quarter.
The company took a $108 million loss on its 30% interest in Hulu.
It earned $120 million on its 39% stake in Sky.
21st Century Fox has agreed to buy the remaining ownership of Sky, but the deal is being reviewed by the British government. The company has also agreed to sell cable and studio assets to the Walt Disney Co.
“We delivered another quarter of solid top-line revenue growth including the further acceleration of gains in global affiliate revenues and despite challenging revenue comparisons for our TV segment. Our results also reflect increased investment behind higher volumes of global sporting events as well as film releases from our studio, which led the industry in Golden Globe awards and Oscar nominations," executive chairmen Rupert Murdoch and Lachlan Murdoch said in a statement.
“Looking ahead, we are focused on continuing to deliver value to our shareholders through achieving our near-term growth plans, completing our proposed acquisition of the balance of Sky, obtaining the required approvals for the successful completion of our transaction with Disney and planning for the exciting launch of the new ‘Fox’,” the Murdochs said.
(Photo via Ervins Strauhmanis's Flickr. Image taken on Sept. 19, 2014 and used per Creative Commons 2.0 license. The photo was cropped to fit 16x9 aspect ratio.)
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