Fox lowers profit outlook, shares drop
By Lisa Richwine and Anya George Tharakan
(Reuters) - Media company Twenty-First Century Fox Inc (FOXA.O: Quote) on Wednesday reduced its profit expectation for the coming year, citing foreign currency impacts, the timing of film releases, and sports and digital investments in India.
Fox had projected earnings in the mid-$7 billion range for the 12 months through June 2016. Its shares fell about 5 percent to $30.50 in after-hours trading.
Earnings before interest, taxes, depreciation and amortization (EBITDA) are projected to grow in the mid-single digits above the $6.49 billion from the just-ended fiscal year, Chief Financial Officer John Nallen said on a conference call.
The growth will be driven by cable networks, Chief Executive Officer James Murdoch said. He said he expected older channels such as Fox News and FX to lose subscribers as the pay TV industry shrinks, but newer offerings including Fox Sports 1 and FXX should pick up customers.
"We have a high degree of confidence in achieving our earnings guidance," Murdoch said.
James Murdoch took over from his father, Rupert, as CEO of Fox on July 1. His brother, Lachlan, was named executive co-chairman alongside Rupert.
Earlier, Fox reported a 9.3 percent fall in quarterly adjusted revenue as television advertising sales fell and a lack of major film releases weighed on its studio.
But Fox's adjusted profit beat Wall Street expectations and the company said it would buy back $5 billion Class A shares over the next 12 months. Continued...