21st Century Fox reported higher first-quarter earnings as it prepared to sell the bulk of its cable and studio assets to the Walt Disney Co.
The parts of the company Fox is keeping--including Fox Broadcasting and Fox News--had a strong quarter.
Net income rose to $1.285 billion, or 69 cents a share, from $855 million, or 46 cents a share, a year ago. The earnings include a tax benefit of $220 million connected to the decision to sell its stake in Sky.
Revenue rose 2% to $7.177 billion.
The earnings included $147 million from its 39% stake in Sky and a $114 million loss from its 30% stake in Hulu.
“We continue to deliver against our growth plan even as we make important strides toward completing our Disney transaction and launching Fox in the first half of 2019,” said executive chairs Rupert and Lachlan Murdoch. “We have assembled a stellar leadership team for FOX, giving us further confidence in the new company’s ability to capture opportunities in live programming while delivering long-term value for shareholders. Our quarterly performance builds on the operational and financial achievements of last year and sets up our businesses for continued momentum under both the enlarged Disney and the future Fox.”
Fox said its cable network programming business had a 2% increase in operating income to $1.54 billion on a 4% increase in revenue. Cost were up because of the World Cup and contractual increases at Fox’s regional sports networks.
Domestic cable revenue increased 7%. Affiliate revenue was up 9% and advertising revenue gained 7%, mainly because of higher rates at Fox News.
Operating income at Fox’s television business, including Fox Broadcasting, was up 38% on a 20% increase in revenue. Ad revenue jumped 22% because of the World Cup, having more NFL football games and higher political ad revenues.
Retransmission consent revenue grew 19%.
Programming expenses were up 17%.
