is not in our nature: News Corp mulls Foxtels
future - 5th November 2021
Corp chief executive Robert Thomson says the company
is undergoing a review of Foxtel. CREDIT: AP
Corporation boss Robert Thomson has signalled the
Rupert Murdoch-controlled media giant is edging closer
to a float of Foxtel, attributing a rise in first-quarter
profits to the pay TV company and Dow Jones.
Thomson would not confirm whether an initial public
listing was on the cards for Foxtel, which runs streaming
services Kayo Sports, Binge and Flash, but said the
company was focused on delivering maximum value to
its shareholders - News Corp and Telstra. He confirmed
a strategic review of the business was underway.
inappropriate at this moment to discuss specifics
in the review, but clearly we and our partners at
Telstra recognise that the prospects of Foxtel have
changed fundamentally and that we have a streaming
success story, Mr Thomson said. Whatever
we do, we will not be naive - naivety is not in our
Rupert Murdoch-controlled media company said its subscription
services segment - which includes Foxtel - reported
a 46 per cent jump in earnings [before interest, tax,
depreciation and amortisation] for the September quarter,
due to a $US34 million ($45 million) reduction in
sports programming and production costs. Foxtels
streaming products Kayo Sports, Binge and Foxtel Now
have about 2.1 million paid subscribers.
are primed to capitalise on the patent success of
the Foxtel streaming strategy, which was highlighted
during the Foxtel Strategy Day, and are reviewing
potential permutations to maximise shareholder value
and growth, Mr Thomson said. We are obviously
now in a position to be even more ambitious for Foxtel
and are always seeking to maximise its undoubted potential.
total closing paid subscribers were around 3.9 million
as of September 30. About 1.8 million were residential
and commercial broadcast subscribers, while 2.1 million
consisted of Kayo, Binge and Foxtel Now subscribers.
Sports paying subscribers grew by 6000 from last quarter
to 1.06 million and Binge subscribers grew to 885,000
from 733,000 in the previous quarter. Residential
subscribers have from 1.9 million at June 30 to 1.77
million. Foxtel Groups streaming revenues make
up 19 per cent of total subscription revenues in the
quarter, which increased $US14 million due to currency
foreign fluctuations. Adjusted revenue was flat year-on-year.
Corp and Telstra, which jointly own Foxtel, have been
weighing up the prospect of a public float of Foxtel
for months. The company now runs three streaming services
Kayo Sports, Binge and Flash and earlier
this month flagged plans to sell smart televisions
under a new agreement with Comcast-owned Sky. It also
recently hired a new chief financial officer, Stuart
Hutton., who was behind the de-merger of manufacturing
company Orora from Amcor in 2013. Foxtel has also
tapped former Hulu boss Randy Freer, who has ties
to the Murdoch family and Hollywood, as a consultant.
Foxtel still has its challenges. Residential and commercial
subscribers continue to decline, and as of June 30,
it still had $1.9 billion in debt owed to credit facilities
and its shareholders.
Corp revenue grew 18 per cent to $US2.5 billion ($3.4
billion) in the first quarter, while net income grew
from $US47 million to $US267 million. EBITDA was $US410
million, up from $US268 million the year prior, driven
by higher revenues, lower costs at Foxtel and a $US11
million positive impact from foreign currency fluctuations.
growth was also helped by Dow Jones, which grew revenue
and profit to its highest point since it was acquired
by News Corp.
Sydney Morning Herald)