News Corp thriving despite probes
Rupert Murdoch’s News Corp said that net income grew by nearly two-thirds in the final quarter of 2011, despite expenses related to ongoing phone hacking investigations of its UK newspaper unit.
The company has settled with about 60 phone hacking victims so far, but a new wave of lawsuits is coming and three parallel police probes are under way.
All of the proceedings are expected to keep News Corp’s legal bills high in the near future.
Net income in the three-month period that ended on December 31 rose to 1.06 billion US dollars, or 42 cents per share, from 642 million US dollars, or 24 cents per share in the same period a year earlier.
Excluding one-time benefits and an 87 million US dollars charge it took related to US government-led probes, adjusted earnings came to 39 cents per share.
That topped the 34 cents per share expected by analysts polled by FactSet. Executives said about 85% of the 87 million US dollars charge represented legal and consulting fees. The remainder went toward out-of-court settlements.
It marked the second quarter in a row that New York-based News Corp has booked significant expenses related to the probes.
Hacking revelations caused the company to shut down the News of the World. In the quarter through to September, the company took a 91 million US dollar charge due to the scandal.
