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Twenty-First Century Fox misses Wall Street sales target

Posted by: Admin | Posted on: May 11th, 2017 | 0 Comments


Twenty-First Century Fox Inc (FOXA.O), the television and film company controlled by Rupert Murdoch, reported quarterly revenue below Wall Street’s expectations on Wednesday, weighed down by weaker box office results.

Its shares initially dipped in after-hours trading, but then regained ground to where they ended regular trading, at $27.90.

Sales at the company’s film division fell nearly 3 percent to $2.26 billion in the fiscal third quarter as releases like “Logan”, grossed less than the 2016 hit “Deadpool” did in the same quarter last year.

The television side of Fox’s business fared better, posting an increase in both advertising and U.S. cable, even as many of its peers have reported declines in both areas.

The U.S. pay-TV industry just notched its worst-ever quarterly subscriber loss, at an estimated 726,000 subscribers, according to a research note by MoffettNathanson. Time Warner executives last week warned of a softening ad sales market, causing media stocks to plummet.

Fox’s ad sales jumped 16 percent, helped by spending on the Super Bowl, which Fox aired this year. Chief Executive James Murdoch, Rupert’s son, told analysts on a post-earnings call that all of its networks except National Geographic showed advertising growth.

Still, some analysts hoped for more.

“The cable business is more of a recurring business than film,” said Telsey Advisory Group analyst Thomas Eagan. “People were expecting higher domestic affiliate growth and higher ad growth.”

U.S. subscribers were up 0.5 percent, but there were declines for its most widely distributed networks, which include Fox News, of about 1.5 percent year over year, James Murdoch said on the analyst call.

Sexual harassment claims and lawsuits at Fox News, which have led to the departures of its former chair Roger Ailes, network co-president Bill Shine and star anchor Bill O’Reilly, have some investors concerned about the future of the unit.

James Murdoch expressed confidence to investors on the earnings call that Fox News would continue its ratings dominance.

The British government has asked the UK media regulator Ofcom to assess whether Twenty First Century Fox’s $14.5 billion bid to buy the nearly 61 percent of UK-based pay-TV group Sky Plc SKYB.L that it does not already own is in the public interest.

“We remain confident the proposed transaction will be approved by the end of the calendar year,” Executive Chairmen Rupert and his other son Lachlan Murdoch said in a statement on Wednesday.

Excluding some items, Fox earned 54 cents per share for the quarter ended March 31. Analysts on average had expected a profit of 48 cents per share.

Total revenue rose 4.6 percent to $7.56 billion but missed analysts’ average estimate of $7.63 billion, according to Thomson Reuters I/B/E/S.

(Reporting by Aishwarya Venugopal in Bengaluru; Editing by Maju Samuel, Sriraj Kalluvila and Bill Rigby)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/a_h6Rpl8Cxg/us-fox-results-idUSKBN1862SU

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