QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
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(Address of principal executive offices) |
(Zip Code) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
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☒ |
Accelerated filer |
☐ | |||
Non-accelerated filer |
☐ |
Smaller reporting company |
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Emerging growth company |
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3 |
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4 |
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36 |
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54 |
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54 |
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55 |
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55 |
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56 |
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56 |
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56 |
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56 |
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57 |
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59 |
For the three months ended |
For the six months ended |
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December 31, |
December 31, |
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Notes |
2019 |
2018 |
2019 |
2018 |
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Revenues: |
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|||||||||||||||||||
Circulation and subscription |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Advertising |
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Consumer |
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Real estate |
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Other |
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Total Revenues |
2 |
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|||||||||||||||
Operating expenses |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
Selling, general and administrative |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
Depreciation and amortization |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
Impairment and restructuring charges |
3 |
( |
) | ( |
) | ( |
) | ( |
) | |||||||||||
Equity losses of affiliates |
4 |
( |
) | ( |
) | ( |
) | ( |
) | |||||||||||
Interest expense, net |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
Other, net |
1 3 |
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|||||||||||||||
Income (loss) before income tax expense |
|
|
( |
) | |
|||||||||||||||
Income tax expense |
1 1 |
( |
) | ( |
) | ( |
) | ( |
) | |||||||||||
Net income (loss) |
|
|
( |
) | |
|||||||||||||||
Less: Net income attributable to noncontrolling interests |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||
Net income (loss) attributable to News Corporation stockholders |
$ | |
$ | |
$ | ( |
) | $ | |
|||||||||||
Net income (loss) attributable to News Corporation stockholders per share: |
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|
9 |
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Basic |
$ |
|
$ |
|
$ |
( |
) |
$ |
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|||||||||||
Diluted |
$ |
|
$ |
|
$ |
( |
) |
$ |
|
For the three months ended |
For the six months ended |
|||||||||||||||
December 31, |
December 31, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Net income (loss) |
$ | $ | $ | ( |
) | $ | ||||||||||
Other comprehensive income (loss): |
||||||||||||||||
Foreign currency translation adjustments |
( |
) | ( |
) | ||||||||||||
Net change in the fair value of cash flow hedges (a) |
( |
) |
||||||||||||||
Benefit plan adjustments, net (b) |
( |
) |
( |
) |
||||||||||||
Other comprehensive income (loss) |
( |
) | ( |
) |
( |
) | ||||||||||
Comprehensive income (loss) |
( |
) | ( |
) | ||||||||||||
Less: Net income attributable to noncontrolling interests |
( |
) |
( |
) | ( |
) |
( |
) | ||||||||
Less: Other comprehensive (income) loss attributable to noncontrolling interests |
( |
) |
||||||||||||||
Comprehensive income (loss) attributable to News Corporation stockholders |
$ | $ | ( |
) | $ | ( |
) | $ | ||||||||
(a) |
Net of income tax benefit of |
(b) |
Net of income tax (benefit) expense of ($ |
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|
As of |
As of |
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Notes |
December 31, 2019 |
June 30, 2019 |
||||||||||
(unaudited) |
(audited) |
|||||||||||
Assets: |
||||||||||||
Current assets: |
||||||||||||
Cash and cash equivalents |
$ | |
$ | |
||||||||
Receivables, net |
1 3 |
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Inventory, net |
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||||||||||
Other current assets |
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Total current assets |
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Non-current assets: |
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Investments |
4 |
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Property, plant and equipment, net |
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||||||||||
Operating lease right-of-use assets |
6 |
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Intangible assets, net |
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Goodwill |
|
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||||||||||
Deferred income tax assets |
11 |
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Other non-current assets |
1 3 |
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Total assets |
$ | |
$ | |
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Liabilities and Equity: |
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Current liabilities: |
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Accounts payable |
$ | |
$ | |
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Accrued expenses |
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Deferred revenue |
2 |
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Current borrowings |
5 |
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Other current liabilities |
1 3 |
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Total current liabilities |
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Non-current liabilities: |
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Borrowings |
5 |
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|||||||||
Retirement benefit obligations |
|
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||||||||||
Deferred income tax liabilities |
1 1 |
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|||||||||
Operating lease liabilities |
6 |
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Other non-current liabilities |
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Commitments and contingencies |
1 0 |
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Class A common stock (a) |
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Class B common stock (b) |
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Additional paid-in capital |
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||||||||||
Accumulated deficit |
( |
) | ( |
) | ||||||||
Accumulated other comprehensive loss |
( |
) | ( |
) | ||||||||
Total News Corporation stockholders’ equity |
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Noncontrolling interests |
|
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Total equity |
7 |
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Total liabilities and equity |
$ | |
$ | |
||||||||
(a) | Class A common stock |
(b) |
Class B common stock . |
For the six months ended |
||||||||||||
December 31, |
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Notes |
2019 |
2018 |
||||||||||
Operating activities: |
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Net (loss) income |
$ | ( |
) | $ | |
|||||||
Adjustments to reconcile net (loss) income to cash provided by operating activities: |
||||||||||||
Depreciation and amortization |
|
|
||||||||||
Operating lease expense |
6 |
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|
|||||||||
Equity losses of affiliates |
4 |
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Cash distributions received from affiliates |
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||||||||||
Impairment charges |
3 |
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Other, net |
13 |
( |
) | ( |
) | |||||||
Deferred income taxes and taxes payable |
11 |
( |
) | |
||||||||
Change in operating assets and liabilities, net of acquisitions: |
||||||||||||
Receivables and other assets |
( |
) | ( |
) | ||||||||
Inventories, net |
|
( |
) | |||||||||
Accounts payable and other liabilities |
|
( |
) | |||||||||
Net cash provided by operating activities |
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||||||||||
Investing activities: |
||||||||||||
Capital expenditures |
( |
) | ( |
) | ||||||||
Acquisitions, net of cash acquired |
( |
) | ( |
) | ||||||||
Investments in equity affiliates and other |
( |
) | ( |
) | ||||||||
Proceeds from business dispositions |
|
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||||||||||
Proceeds from property, plant and equipment and other asset dispositions |
|
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||||||||||
Other, net |
|
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||||||||||
Net cash used in investing activities |
( |
) | ( |
) | ||||||||
Financing activities: |
||||||||||||
Borrowings |
5 |
|
|
|||||||||
Repayment of borrowings |
5 |
( |
) | ( |
) | |||||||
Dividends paid |
( |
) | ( |
) | ||||||||
Other, net |
( |
) | ( |
) | ||||||||
Net cash used in financing activities |
( |
) | ( |
) | ||||||||
Net change in cash and cash equivalents |
( |
) | ( |
) | ||||||||
Cash and cash equivalents, beginning of year |
|
|
||||||||||
Exchange movement on opening cash balance |
( |
) | ( |
) | ||||||||
Cash and cash equivalents, end of year |
$ | |
$ | |
||||||||
For the three months ended December 31, 2019 |
||||||||||||||||||||||||
News and Information Services |
Subscription Video Services |
Book Publishing |
Digital Real Estate Services |
Other |
Total Revenues |
|||||||||||||||||||
(in millions) |
||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||
Circulation and subscription |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Advertising |
|
|
|
|
|
|
||||||||||||||||||
Consumer |
|
|
|
|
|
|
||||||||||||||||||
Real estate |
|
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|
|
|
|
||||||||||||||||||
Other |
|
|
|
|
|
|
||||||||||||||||||
Total Revenues |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
For the three months ended December 31, 2018 |
||||||||||||||||||||||||
News and Information Services |
Subscription Video Services |
Book Publishing |
Digital Real Estate Services |
Other |
Total Revenues |
|||||||||||||||||||
(in millions) |
||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||
Circulation and subscription |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||||||||
Advertising |
|
|
|
|
|
|
||||||||||||||||||
Consumer |
|
|
|
|
|
|
||||||||||||||||||
Real estate |
|
|
|
|
|
|
||||||||||||||||||
Other |
|
|
|
|
|
|
||||||||||||||||||
Total Revenues |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||||||||
For the six months ended December 31, 2019 |
||||||||||||||||||||||||
News and Information Services |
Subscription Video Services |
Book Publishing |
Digital Real Estate Services |
Other |
Total Revenues |
|||||||||||||||||||
(in millions) |
||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||
Circulation and subscription |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Advertising |
|
|
|
|
|
|
||||||||||||||||||
Consumer |
|
|
|
|
|
|
||||||||||||||||||
Real estate |
|
|
|
|
|
|
||||||||||||||||||
Other |
|
|
|
|
|
|
||||||||||||||||||
Total Revenues |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
For the six months ended December 31, 2018 |
||||||||||||||||||||||||
News and Information Services |
Subscription Video Services |
Book Publishing |
Digital Real Estate Services |
Other |
Total Revenues |
|||||||||||||||||||
(in millions) |
||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||
Circulation and subscription |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
Advertising |
|
|
|
|
|
|
||||||||||||||||||
Consumer |
|
|
|
|
|
|
||||||||||||||||||
Real estate |
|
|
|
|
|
|
||||||||||||||||||
Other |
|
|
|
|
|
|
||||||||||||||||||
Total Revenues |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Balance, beginning of period |
$ | |
$ | |
$ | |
$ | |
||||||||
Deferral of revenue |
|
|
|
|
||||||||||||
Recognition of deferred revenue (a) |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Other |
|
( |
) | ( |
) | |
||||||||||
Balance, end of period |
$ | |
$ | |
$ | |
$ | |
||||||||
(a) |
For the three and six months ended December 31, 2019, the Company recognized approximately $ |
For the three months ended December 31, |
||||||||||||||||||||||||||||||||
2019 |
2018 |
|||||||||||||||||||||||||||||||
One time |
One time |
|||||||||||||||||||||||||||||||
employee |
Facility |
employee |
Facility |
|||||||||||||||||||||||||||||
termination |
related |
termination |
related |
|||||||||||||||||||||||||||||
benefits |
costs |
Other costs |
Total |
benefits |
costs |
Other costs |
Total |
|||||||||||||||||||||||||
(in millions) |
||||||||||||||||||||||||||||||||
Balance, beginning of period |
$ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Additions |
||||||||||||||||||||||||||||||||
Payments |
( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||
Other |
( |
) | ( |
) | ||||||||||||||||||||||||||||
Balance, end of period |
$ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
For the six months ended December 31, |
||||||||||||||||||||||||||||||||
2019 |
2018 |
|||||||||||||||||||||||||||||||
One time |
One time |
|||||||||||||||||||||||||||||||
employee |
Facility |
employee |
Facility |
|||||||||||||||||||||||||||||
termination |
related |
termination |
related |
|||||||||||||||||||||||||||||
benefits |
costs |
Other costs |
Total |
benefits |
costs |
Other costs |
Total |
|||||||||||||||||||||||||
(in millions) |
||||||||||||||||||||||||||||||||
Balance, beginning of period |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||||||||
Additions |
||||||||||||||||||||||||||||||||
Payments |
( |
) |
( |
) |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||||||||||
Other |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||||||||||||||
Balance, end of period |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||||||||
Ownership Percentage as of December 31, 2019 |
As of December 31, 2019 |
As of June 30, 2019 |
||||||||||
(in millions) |
||||||||||||
Equity method investments (a) |
various |
$ | $ | |||||||||
Equity securities (b) |
various |
|||||||||||
Total Investments |
$ | $ | ||||||||||
(a) |
Equity method investments are primarily comprised of Foxtel’s investment in Nickelodeon Australia Joint Venture and Elara Technologies Pte. Ltd. (“Elara”), which operates PropTiger.com, Makaan.com and Housing.com. |
(b) |
Equity securities are primarily comprised of certain investments in China and the Company’s investment in HT&E Limited, which operates a portfolio of Australian radio and outdoor media assets. |
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
(in millions) |
(in millions) |
|||||||||||||||
Total losses recognized on equity securities |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
Less: Net gains recognized on equity securities sold |
||||||||||||||||
Unrealized losses recognized on equity securities held at end of period |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
Interest rate at December 31, 2019 |
Maturity at December 31, 2019 |
As of December 31, 2019 |
As of June 30, 2019 |
|||||||||||||
(in millions) |
||||||||||||||||
Foxtel Group |
||||||||||||||||
Credit facility 2014 — tranche 2 (a) |
$ | $ | ||||||||||||||
Credit facility 2015 (a) |
||||||||||||||||
Credit facility 2016 (a) |
||||||||||||||||
Credit facility 2019 (b) |
% |
|||||||||||||||
Term loan facility 2019 (d) |
% |
|||||||||||||||
Working capital facility 201 7 (a) (c) |
% | |||||||||||||||
US private placement 2009 — tranche 3 ( g ) |
||||||||||||||||
US private placement 2012 — USD portion — tranche 1 ( g ) |
||||||||||||||||
US private placement 2012 — USD portion — tranche 2 ( h ) |
% | |||||||||||||||
US private placement 2012 — USD portion — tranche 3 ( h ) |
% | |||||||||||||||
US private placement 2012 — AUD portion |
% | |||||||||||||||
REA Group |
||||||||||||||||
Credit facility 2016 — tranche 3 ( i ) |
||||||||||||||||
Credit facility 2018 ( j ) |
% | |||||||||||||||
Credit facility 2019 (j) |
% |
|||||||||||||||
Total borrowings |
||||||||||||||||
Less: current portion ( l ) |
( |
) | ||||||||||||||
Long-term borrowings |
$ | $ | ||||||||||||||
(a) |
During November 2019, certain subsidiaries of NXE Australia Pty Limited (“Foxtel” and together with such subsidiaries, the “Foxtel Debt Group”) repaid the outstanding borrowings under these facilities using a combination of new indebtedness and an A$ |
(b) |
During November 2019, the Foxtel Debt Group entered into an A$ Credit Facility”). |
(c) |
Borrowings under these facilities bear interest at a floating rate of the Australian BBSY plus an applicable margin of betweenper annum depending on the Foxtel Debt Group’s net leverage ratio. As of December 31, 2019, the Foxtel Debt Group was paying a margin of |
(d) |
During November 2019, the Foxtel Debt Group entered into an A $term loan facility maturing in (the “2019 Term Loan Facility”). Borrowings under the 2019 Term Loan Facility bear interest at a fixed rate of per annum. |
(e) |
During November 2019, the Foxtel Debt Group amended its 2017 Working Capital Facility which, among other things, extended the remaining term to $ million to $A million and increased the applicable margin. |
(f) |
As of December 31, 2019, the Foxtel Debt Group has undrawn commitments of $ |
(g) |
During the first quarter of fiscal 2020, the Foxtel Debt Group repaid $ million aggregate principal amount of senior unsecured notes which matured in July 2019 and $ million aggregate principal amount of senior unsecured notes which matured in September 2019. |
(h) |
The carrying values of the borrowings include any fair value adjustments related to the Company’s fair value hedges. See Note 8 —Financial Instruments and Fair Value Measurements. |
(i) |
During December 2019, REA Group repaid the final A$ million tranche of its A$ million revolving loan facility using a combination of cash on hand and new indebtedness. |
(j) |
Borrowings under these facilities bear interest at a floating rate of the Australian BBSY plus a margin of between |
(k) |
During December 2019, REA Group entered into an A$ December 2021 Credit Facility”). |
(l) |
The Company classifies the current portion of long term debt as non-current liabilities on the Balance Sheets when it has the intent and ability to refinance the obligation on a long-term basis, in accordance with ASC 470-50 “Debt.” |
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||
Income Statement Location |
2019 |
2019 |
||||||||||
(in millions) |
||||||||||||
Operating lease costs |
Selling, general and administrative |
$ | $ | |||||||||
Operating lease costs |
Operating expenses |
|||||||||||
Short term lease costs |
Operating expenses |
|||||||||||
Variable lease costs |
Selling, general and administrative |
|||||||||||
Total lease costs |
$ | $ | ||||||||||
As of December 31, 2019 |
||||
Weighted-average remaining lease term |
||||
Weighted-average incremental borrowing rate |
% | |||
For the six months ended December 31, |
||||
2019 |
||||
(in millions) |
||||
Cash paid - Operating lease liabilities |
$ | |||
Operating lease right-of-use asset obtained in exchange for operating lease liabilities |
$ |
As of December 31, 2019 |
||||
(in millions) |
||||
Fiscal 2020 (six months remaining) |
$ | |||
Fiscal 2021 |
||||
Fiscal 2022 |
||||
Fiscal 2023 |
||||
Fiscal 2024 |
||||
Thereafter |
||||
Total future minimum lease payments |
||||
Less: interest |
||||
Present value of minimum payments |
$ | |||
|
For the three months ended December 31, 2019 |
|||||||||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
Accumulated |
|
|
|
||||||||||||||||||||||||||||||
|
Class A |
Class B |
Additional |
|
Other |
Total |
|
|
||||||||||||||||||||||||||||||||
|
Common Stock |
Common Stock |
Paid-in |
Accumulated |
Comprehensive |
News Corp |
Non-controlling |
Total |
||||||||||||||||||||||||||||||||
|
Shares |
Amount |
Shares |
Amount |
Capital |
Deficit |
Loss |
Equity |
Interests |
Equity |
||||||||||||||||||||||||||||||
|
(in millions) |
|||||||||||||||||||||||||||||||||||||||
Balance, September 30, 2019 |
|
$ | |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
$ | |
$ | |
||||||||||||||||||||
Net income |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Dividends |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Other |
|
|
|
|
|
|
( |
) | |
|
|
|||||||||||||||||||||||||||||
Balance, December 31, 2019 |
|
$ | |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
$ | |
$ | |
||||||||||||||||||||
|
For the three months ended December 31, 2018 |
|||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
Accumulated |
|
|
|
||||||||||||||||||||||||||||||
|
Class A |
Class B |
Additional |
|
Other |
Total |
|
|
||||||||||||||||||||||||||||||||
|
Common Stock |
Common Stock |
Paid-in |
Accumulated |
Comprehensive |
News Corp |
Non-controlling |
Total |
||||||||||||||||||||||||||||||||
|
Shares |
Amount |
Shares |
Amount |
Capital |
Deficit |
Loss |
Equity |
Interests |
Equity |
||||||||||||||||||||||||||||||
|
(in millions) |
|||||||||||||||||||||||||||||||||||||||
Balance, September 30, 2018 |
|
$ | |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
$ | |
$ | |
||||||||||||||||||||
Net income |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Other comprehensive loss |
|
|
|
|
|
|
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||||||||||||||||
Dividends |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Other |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Balance, December 31, 2018 |
|
$ | |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
$ | |
$ | |
For the six months ended December 31, 2019 |
||||||||||||||||||||||||||||||||||||||||
Accumulated |
||||||||||||||||||||||||||||||||||||||||
Class A |
Class B |
Additional |
Other |
Total |
||||||||||||||||||||||||||||||||||||
Common Stock |
Common Stock |
Paid-in |
Accumulated |
Comprehensive |
News Corp |
Non - controlling |
Total |
|||||||||||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
Capital |
Deficit |
Loss |
Equity |
Interests |
Equity |
|||||||||||||||||||||||||||||||
(in millions) |
||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2019 |
|
$ | |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
$ | |
$ | |
||||||||||||||||||||
Cumulative impact from adoption of new standards |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Net ( loss income ) |
|
|
|
|
|
( |
) | |
( |
) | |
( |
) | |||||||||||||||||||||||||||
Other comprehensive income ( loss ) |
|
|
|
|
|
|
|
|
( |
) | ( |
) | ||||||||||||||||||||||||||||
Dividends |
|
|
|
|
( |
) | |
|
( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||
Other |
|
|
|
|
( |
) | |
( |
) | ( |
) | ( |
) | ( |
) | |||||||||||||||||||||||||
Balance, December 31, 2019 |
|
$ | |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
$ | |
$ | |
||||||||||||||||||||
For the six months ended December 31, 2018 |
||||||||||||||||||||||||||||||||||||||||
Accumulated |
||||||||||||||||||||||||||||||||||||||||
Class A |
Class B |
Additional |
Other |
Total |
||||||||||||||||||||||||||||||||||||
Common Stock |
Common Stock |
Paid-in |
Accumulated |
Comprehensive |
News Corp |
Non - controlling |
Total |
|||||||||||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
Capital |
Deficit |
Loss |
Equity |
Interests |
Equity |
|||||||||||||||||||||||||||||||
(in millions) |
||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2018 |
|
$ | |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
$ | |
$ | |
||||||||||||||||||||
Cumulative impact from adoption of new standards |
|
|
|
|
|
|
( |
) | |
|
|
|||||||||||||||||||||||||||||
Net income |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Other comprehensive loss |
|
|
|
|
|
|
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||
Dividends |
|
|
|
|
( |
) | |
|
( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||
Other |
|
|
|
|
|
( |
) | |
|
|
|
|||||||||||||||||||||||||||||
Balance, December 31, 2018 |
|
$ | |
|
$ | |
$ | |
$ | ( |
) | $ | ( |
) | $ | |
$ | |
$ | |
||||||||||||||||||||
• |
Level 1 — Quoted prices in active markets for identical assets or liabilities. |
• |
Level 2 — Observable inputs other than quoted prices included in Level 1. The Company could value assets and liabilities included in this level using dealer and broker quotations, certain pricing models, bid prices, quoted prices for similar assets and liabilities in active markets, or other inputs that are observable or can be corroborated by observable market data. |
• |
Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. For the Company, this primarily includes the use of forecasted financial information and other valuation related assumptions such as discount rates and long term growth rates in the income approach as well as the market approach which utilizes certain market and transaction multiples. |
As of December 31, 2019 |
As of June 30, 2019 |
|||||||||||||||||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||||||||||||||
(in millions) |
||||||||||||||||||||||||||||||||
Assets: |
||||||||||||||||||||||||||||||||
Foreign currency derivatives - cash flow hedges |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||||||
Cross currency interest rate derivatives - fair value hedges |
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Cross currency interest rate derivatives - economic hedges |
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Cross currency interest rate derivatives - cash flow hedges |
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Equity securities (a) |
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total assets |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||||||
Liabilities: |
||||||||||||||||||||||||||||||||
Foreign currency derivatives - cash flow hedges |
|
$ |
|
|
|
$ |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
| |
Interest rate derivatives - cash flow hedges |
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Mandatorily redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Cross currency interest rate derivatives - cash flow hedges |
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total liabilities |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
$ | |
||||||||||||||||
(a) | See Note 4 —Investments. |
For the six months ended December 31, |
||||||||
2019 |
2018 |
|||||||
(in millions) |
||||||||
Balance - beginning of period (a) |
$ |
$ |
||||||
Purchases |
||||||||
Sales |
( |
) | ||||||
Measurement adjustments |
( |
) |
||||||
Foreign exchange and other |
( |
) |
( |
) | ||||
Balance - end of period |
$ |
$ |
(a) |
As a result of the adoption of ASU 2016-01 during the first quarter of fiscal 2019, the cumulative net unrealized gains (losses) for these investments contained within Accumulated other comprehensive loss were reclassified through Accumulated deficit as of July 1, 2018. |
For the six months ended December 31, |
||||||||
2019 |
2018 |
|||||||
(in millions) |
||||||||
Balance - beginning of period |
$ | $ | ||||||
Payments (a) |
( |
) | ||||||
Other |
( |
) | ||||||
Balance - end of period |
$ | $ | ||||||
(a) |
In July 2019, REA Group acquired the remaining |
• |
foreign currency exchange rate risk: arising primarily through Foxtel Debt Group borrowings denominated in U.S. dollars and payments for customer premise equipment; and |
• |
interest rate risk: arising from fixed and floating rate Foxtel Debt Group borrowings. |
Balance Sheet Location |
As of December 31, 2019 |
As of June 30, 2019 |
||||||||||
(in millions) |
||||||||||||
Foreign currency derivatives - cash flow hedges |
Other current assets |
$ | $ | |||||||||
Cross currency interest rate derivatives - fair value hedges |
Other current assets |
|||||||||||
Cross currency interest rate derivatives - economic hedges |
Other current assets |
|||||||||||
Cross currency interest rate derivatives - cash flow hedges |
Other current assets |
|||||||||||
Cross currency interest rate derivatives - fair value hedges |
Other non-current assets |
|||||||||||
Cross currency interest rate derivatives - cash flow hedges |
Other non-current assets |
|||||||||||
Foreign currency derivatives - cash flow hedges |
Other current liabilities |
( |
) |
|||||||||
Interest rate derivatives - cash flow hedges |
Other current liabilities |
( |
) | |||||||||
Interest rate derivatives - cash flow hedges |
Other non-current liabilities |
( |
) | ( |
) | |||||||
Cross currency interest rate derivatives - cash flow hedges |
Other non-current liabilities |
( |
) | ( |
) |
Gain (loss) recognized in Accumulated |
(Gain) loss reclassified from Accumulated |
|||||||||||||||||
other comprehensive loss for the three months ended |
other comprehensive loss for the three months ended |
Income statement | ||||||||||||||||
December 31, |
December 31, |
location | ||||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||||
(in millions) |
||||||||||||||||||
Derivative instruments designated as cash flow hedges: |
||||||||||||||||||
Foreign currency derivatives - cash flow hedges |
$ |
( |
) |
$ |
$ |
$ |
( |
) |
Operating expenses | |||||||||
Cross currency interest rate derivatives - cash flow hedges |
( |
) |
( |
) |
Interest expense, net | |||||||||||||
Interest rate derivatives - cash flow hedges |
( |
) |
Interest expense, net | |||||||||||||||
Total |
$ |
( |
) |
$ |
$ |
$ |
( |
) |
||||||||||
Gain (loss) recognized in Accumulated |
(Gain) loss reclassified from Accumulated |
|||||||||||||||||
o ther c omprehensive l oss for the six months ended |
o ther c omprehensive l oss for the six months ended |
Income statement | ||||||||||||||||
December 31, |
December 31, |
location | ||||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||||
(in millions) |
||||||||||||||||||
Derivative instruments designated as cash flow hedges: |
||||||||||||||||||
Foreign currency derivatives - cash flow hedges |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
( |
) |
Operating expenses | |||||||
Cross currency interest rate derivatives - cash flow hedges |
( |
) |
( |
) |
Interest expense, net | |||||||||||||
Interest rate derivatives - cash flow hedges |
( |
) |
( |
) |
( |
) |
Interest expense, net | |||||||||||
Total |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
( |
) |
||||||||
As of |
||||
December 31, 2019 |
||||
(in millions) |
||||
Borrowings: |
||||
Carrying amount of hedged item |
$ |
|||
Cumulative hedging adjustments included in the carrying amount |
$ |
( |
) |
For the three months ended December 31, |
For the six months December 31, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
(in millions, except per share amounts) |
||||||||||||||||
Net income (loss) |
$ |
$ |
$ |
( |
) |
$ |
||||||||||
Less: Net income attributable to noncontrolling interests |
( |
) | ( |
) |
( |
) | ( |
) | ||||||||
Net income (loss) attributable to News Corporation stockholders |
$ |
$ |
$ |
( |
) |
$ |
||||||||||
Weighted-average number of shares of common stock outstanding - basic |
||||||||||||||||
Dilutive effect of equity awards (a) |
||||||||||||||||
Weighted-average number of shares of common stock outstanding - diluted |
||||||||||||||||
Net income (loss) attributable to News Corporation stockholders per share - basic |
$ |
$ |
$ |
( |
) | $ |
||||||||||
Net income (loss) attributable to News Corporation stockholders per share - diluted |
$ |
$ |
$ |
( |
) | $ |
(a) |
The dilutive impact of the Company’s performance stock units, restricted stock units and stock options has been excluded from the calculation of diluted loss per share for the six months ended December 31, 2019 because their inclusion would have an antidilutive effect on the net loss per share. |
As of December 31, 2019 |
||||||||||||||||||||
Payments Due by Period |
||||||||||||||||||||
Total |
Less than 1 year |
1-3 years |
3-5 years |
More than 5 years |
||||||||||||||||
(in millions) |
||||||||||||||||||||
Borrowings |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||
Interest payments on borrowings (a) |
$ |
$ |
$ |
$ |
$ |
(a) |
Reflects the Company’s expected future interest payments based on borrowings outstanding and interest rates applicable at December 31, 2019. Such outstanding amounts and rates are subject to change in future periods. See Note 5 —Borrowings. |
• |
News and Information Services —The News and Information Services segment includes the Company’s global print, digital and broadcast radio media platforms. These product offerings include the global print and digital versions of The Wall Street Journal and Barron’s Group, which includes Barron’s and MarketWatch, the Company’s suite of professional information products, including Factiva, Dow Jones Risk & Compliance and Dow Jones Newswires, and its live journalism events. The Company also owns, among other publications, The Australian , The Daily Telegraph, Herald Sun, The Courier Mail and The Advertiser in Australia, The Times, The Sunday Times, The Sun and The Sun on Sunday in the U.K. and the New York Post in the U.S. This segment also includes News America Marketing, a leading provider of in-store marketing products and services, home-delivered shopper media and digital marketing solutions, including Checkout 51’s mobile app, as well as Wireless Group, operator of talkSPORT, the leading sports radio network in the U.K., and Storyful, a social media content agency. |
• | Subscription Video Services —The Company’s Subscription Video Services segment provides video sports, entertainment and news services to pay-TV subscribers and other commercial licensees, primarily via cable, satellite and internet distribution, and consists of (i) the Company’s - pay-TV provider in Australia, with nearly over-the-top, or OTT, service and Kayo, a sports-only OTT service. |
• |
Book Publishing —The Book Publishing segment consists of HarperCollins, the second largest consumer book publisher in the world, with operations in The Hobbit, Goodnight Moon, To Kill a Mockingbird, Jesus Calling and Hillbilly Elegy . |
• | Digital Real Estate Services |
• | Other |
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
(in millions) |
||||||||||||||||
Revenues: |
||||||||||||||||
News and Information Services |
$ | |
$ | |
$ | |
$ | |
||||||||
Subscription Video Services |
|
|
|
|
||||||||||||
Book Publishing |
|
|
|
|
||||||||||||
Digital Real Estate Services |
|
|
|
|
||||||||||||
Other |
|
|
|
|
||||||||||||
Total revenues |
$ | |
$ | |
$ | |
$ | |
||||||||
Segment EBITDA: |
||||||||||||||||
News and Information Services |
$ | |
$ | |
$ | |
$ | |
||||||||
Subscription Video Services |
|
|
|
|
||||||||||||
Book Publishing |
|
|
|
|
||||||||||||
Digital Real Estate Services |
|
|
|
|
||||||||||||
Other |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Depreciation and amortization |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Impairment and restructuring charges |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Equity losses of affiliates |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Interest expense, net |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Other, net |
|
|
|
|
||||||||||||
Income (loss) before income tax expense |
|
|
( |
) | |
|||||||||||
Income tax expense |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Net income (loss) |
$ | |
$ | |
$ | ( |
) | $ | |
|||||||
As of December 31 , 2019 |
As of June 30 , 2019 |
|||||||
(in millions) |
||||||||
Total assets: |
|
|||||||
News and Information Services |
$ | |
$ | |
||||
Subscription Video Services |
|
|
||||||
Book Publishing |
|
|
||||||
Digital Real Estate Services |
|
|
||||||
Other (a) |
|
|
||||||
Investments |
|
|
||||||
Total assets |
$ | |
$ | |
||||
(a) |
The Other segment primarily includes Cash and cash equivalents. |
As of December 31, 2019 |
As of June 30, 2019 |
|||||||
(in millions) |
||||||||
Goodwill and intangible assets, net: |
||||||||
News and Information Services |
$ | |
$ | |
||||
Subscription Video Services |
|
|
||||||
Book Publishing |
|
|
||||||
Digital Real Estate Services |
|
|
||||||
Total Goodwill and intangible assets, net |
$ | |
$ | |
||||
As of December 31, 2019 |
As of June 30, 2019 |
|||||||
(in millions) |
||||||||
Receivables |
$ | |
$ | |
||||
Allowance for doubtful accounts |
( |
) | ( |
) | ||||
Receivables, net |
$ | |
$ | |
||||
As of December 31, 2019 |
As of June 30, 2019 |
|||||||
(in millions) |
||||||||
Royalty advances to authors |
$ |
|
$ |
|
||||
Retirement benefit assets |
|
|
||||||
Inventory (a) |
|
|
||||||
Other |
|
|
||||||
Total Other non-current assets |
$ |
|
$ |
|
(a) |
Primarily consists of the non-current portion of programming rights. |
As of December 31, 2019 |
As of June 30, 2019 |
|||||||
(in millions) |
||||||||
Royalties and commissions payable |
$ | |
$ | |
||||
Current operating lease liabilities (a) |
|
|
||||||
Allowance for sales returns |
|
|
||||||
Current tax payable |
|
|
||||||
Other |
|
|
||||||
Total Other current liabilities |
$ | |
$ | |
||||
(a) |
As a result of the adoption of ASU 2016-02 during the first quarter of fiscal 2020, the Company has included the current portion of its operating lease liabilities within Other current liabilities as of December 31, 2019. |
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
(in millions) |
||||||||||||||||
Dividends received from equity security investments |
$ | |
$ | |
$ | |
$ | |
||||||||
Remeasurement of equity securities |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Gain on sale of Australian property |
|
|
|
|
||||||||||||
Other, net |
|
|
|
|
||||||||||||
Total Other, net |
$ | |
$ | |
$ | |
$ | |
||||||||
For the six months ended December 31, |
||||||||
2019 |
2018 |
|||||||
(in millions) |
||||||||
Cash paid for interest |
$ |
|
$ |
|
||||
Cash paid for taxes |
$ |
|
$ |
|
• | Overview of the Company’s Businesses - |
• | Results of Operations - |
• | Liquidity and Capital Resources - |
• | News and Information Services The Wall Street Journal Barron’s The Australian The Daily Telegraph Herald Sun The Courier Mail The Advertiser The Times The Sunday Times The Sun The Sun on Sunday New York Post in-store marketing products and services, home-delivered shopper media and digital marketing solutions, including Checkout 51’s mobile app, as well as Wireless Group, operator of talkSPORT, the leading sports radio network in the U.K., and Storyful, a social media content agency. |
• | Subscription Video Services pay-TV subscribers and other commercial licensees, primarily via cable, satellite and internet distribution, and consists of (i) the Company’s 65% interest in Foxtel (with the remaining 35% interest in Foxtel held by Telstra, an Australian Securities Exchange (“ASX”)-listed telecommunications company) and (ii) Australian News Channel (“ANC”). Foxtel is the largest pay-TV provider in Australia, with nearly 200 channels covering sports, general entertainment, movies, documentaries, music, children’s programming and news. Foxtel offers the leading sports programming content in Australia, with broadcast rights to live sporting events including: National Rugby League, Australian Football League, Cricket Australia, the domestic football league, the Australian Rugby Union and various motorsports programming. Foxtel also operates Foxtel Now, an over-the-top, or OTT, service, and Kayo, a sports-only OTT service. |
• | Book Publishing The Hobbit, Goodnight Moon, To Kill a Mockingbird, Jesus Calling Hillbilly Elegy |
• | Digital Real Estate Services end-to-end digital property search and financing experience and a mortgage broking offering. |
• | Other |
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||||||||||||||||||
2019 |
2018 |
Change |
% Change |
2019 |
2018 |
Change |
% Change |
|||||||||||||||||||||||||
(in millions, except %) |
Better/(Worse) |
Better/(Worse) |
||||||||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||||||||||
Circulation and subscription |
$ | 990 |
$ | 1,029 |
$ | (39 |
) | (4 |
)% | $ | 1,985 |
$ | 2,063 |
$ | (78 |
) | (4 |
)% | ||||||||||||||
Advertising |
677 |
718 |
(41 |
) | (6 |
)% | 1,285 |
1,382 |
(97 |
) | (7 |
)% | ||||||||||||||||||||
Consumer |
421 |
478 |
(57 |
) | (12 |
)% | 808 |
878 |
(70 |
) | (8 |
)% | ||||||||||||||||||||
Real estate |
242 |
248 |
(6 |
) | (2 |
)% | 460 |
475 |
(15 |
) | (3 |
)% | ||||||||||||||||||||
Other |
149 |
154 |
(5 |
) | (3 |
)% | 281 |
353 |
(72 |
) | (20 |
)% | ||||||||||||||||||||
Total Revenues |
2,479 |
2,627 |
(148 |
) | (6 |
)% | 4,819 |
5,151 |
(332 |
) | (6 |
)% | ||||||||||||||||||||
Operating expenses |
(1,350 |
) | (1,484 |
) | 134 |
9 |
% | (2,687 |
) | (2,824 |
) | 137 |
5 |
% | ||||||||||||||||||
Selling, general and administrative |
(774 |
) | (773 |
) | (1 |
) | — |
(1,556 |
) | (1,599 |
) | 43 |
3 |
% | ||||||||||||||||||
Depreciation and amortization |
(162 |
) | (163 |
) | 1 |
1 |
% | (324 |
) | (326 |
) | 2 |
1 |
% | ||||||||||||||||||
Impairment and restructuring charges |
(29 |
) | (19 |
) | (10 |
) | (53 |
)% | (326 |
) | (37 |
) | (289 |
) | ** |
|||||||||||||||||
Equity losses of affiliates |
(3 |
) | (6 |
) | 3 |
50 |
% | (5 |
) | (9 |
) | 4 |
44 |
% | ||||||||||||||||||
Interest expense, net |
(8 |
) | (15 |
) | 7 |
47 |
% | (4 |
) | (31 |
) | 27 |
87 |
% | ||||||||||||||||||
Other, net |
2 |
7 |
(5 |
) | (71 |
)% | 6 |
27 |
(21 |
) | (78 |
)% | ||||||||||||||||||||
Income (loss) before income tax expense |
155 |
174 |
(19 |
) |
(11 |
)% |
(77 |
) |
352 |
(429 |
) |
** |
||||||||||||||||||||
Income tax expense |
(52 |
) | (55 |
) | 3 |
5 |
% | (31 |
) | (105 |
) | 74 |
70 |
% | ||||||||||||||||||
Net income (loss) |
103 |
119 |
(16 |
) | (13 |
)% | (108 |
) | 247 |
(355 |
) | ** |
||||||||||||||||||||
Less: Net income attributable to noncontrolling interests |
(18 |
) | (24 |
) | 6 |
25 |
% | (34 |
) | (51 |
) | 17 |
33 |
% | ||||||||||||||||||
Net income (loss) attributable to News Corporation stockholders |
$ |
85 |
$ |
95 |
$ |
(10 |
) |
(11 |
)% |
$ |
(142 |
) |
$ |
196 |
$ |
(338 |
) |
** |
||||||||||||||
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
(in millions, except %) |
||||||||||||||||
Net income (loss) |
$ | 103 |
$ | 119 |
$ | (108 |
) | $ | 247 |
|||||||
Add: |
||||||||||||||||
Income tax expense |
52 |
55 |
31 |
105 |
||||||||||||
Other, net |
(2 |
) | (7 |
) | (6 |
) | (27 |
) | ||||||||
Interest expense, net |
8 |
15 |
4 |
31 |
||||||||||||
Equity losses of affiliates |
3 |
6 |
5 |
9 |
||||||||||||
Impairment and restructuring charges |
29 |
19 |
326 |
37 |
||||||||||||
Depreciation and amortization |
162 |
163 |
324 |
326 |
||||||||||||
Total Segment EBITDA |
$ | 355 |
$ | 370 |
$ | 576 |
$ | 728 |
||||||||
For the three months ended December 31, |
||||||||||||||||
2019 |
2018 |
|||||||||||||||
Segment |
Segment |
|||||||||||||||
(in millions) |
Revenues |
EBITDA |
Revenues |
EBITDA |
||||||||||||
News and Information Services |
$ | 1,241 |
$ | 142 |
$ | 1,257 |
$ | 112 |
||||||||
Subscription Video Services |
501 |
70 |
562 |
84 |
||||||||||||
Book Publishing |
442 |
63 |
496 |
88 |
||||||||||||
Digital Real Estate Services |
294 |
118 |
311 |
121 |
||||||||||||
Other |
1 |
(38 |
) | 1 |
(35 |
) | ||||||||||
Total |
$ | 2,479 |
$ | 355 |
$ | 2,627 |
$ | 370 |
||||||||
For the six months ended December 31, |
||||||||||||||||
2019 |
2018 |
|||||||||||||||
Segment |
Segment |
|||||||||||||||
(in millions) |
Revenues |
EBITDA |
Revenues |
EBITDA |
||||||||||||
News and Information Services |
$ | 2,390 |
$ | 198 |
$ | 2,505 |
$ | 221 |
||||||||
Subscription Video Services |
1,015 |
151 |
1,127 |
197 |
||||||||||||
Book Publishing |
847 |
112 |
914 |
156 |
||||||||||||
Digital Real Estate Services |
566 |
200 |
604 |
226 |
||||||||||||
Other |
1 |
(85 |
) | 1 |
(72 |
) | ||||||||||
Total |
$ | 4,819 |
$ | 576 |
$ | 5,151 |
$ | 728 |
||||||||
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||||||||||||||||||
2019 |
2018 |
Change |
% Change |
2019 |
2018 |
Change |
% Change |
|||||||||||||||||||||||||
(in millions, except %) |
Better/(Worse) |
Better/(Worse) |
||||||||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||||||||||
Circulation and subscription |
$ | 541 |
$ | 526 |
$ | 15 |
3 |
% | $ | 1,075 |
$ | 1,055 |
$ | 20 |
2 |
% | ||||||||||||||||
Advertising |
599 |
632 |
(33 |
) | (5 |
)% | 1,129 |
1,208 |
(79 |
) | (7 |
)% | ||||||||||||||||||||
Other |
101 |
99 |
2 |
2 |
% | 186 |
242 |
(56 |
) | (23 |
)% | |||||||||||||||||||||
Total Revenues |
1,241 |
1,257 |
(16 |
) |
(1 |
)% |
2,390 |
2,505 |
(115 |
) |
(5 |
)% | ||||||||||||||||||||
Operating expenses |
(671 |
) | (713 |
) | 42 |
6 |
% | (1,341 |
) | (1,422 |
) | 81 |
6 |
% | ||||||||||||||||||
Selling, general and administrative |
(428 |
) | (432 |
) | 4 |
1 |
% | (851 |
) | (862 |
) | 11 |
1 |
% | ||||||||||||||||||
Segment EBITDA |
$ |
142 |
$ |
112 |
$ |
30 |
27 |
% |
$ |
198 |
$ |
221 |
$ |
(23 |
) |
(10 |
)% | |||||||||||||||
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||||||||||||||||||
2019 |
2018 |
Change |
% Change |
2019 |
2018 |
Change |
% Change |
|||||||||||||||||||||||||
(in millions, except %) |
Better/(Worse) |
Better/(Worse) |
||||||||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||||||||||
Circulation and subscription |
$ | 439 |
$ | 490 |
$ | (51 |
) | (10 |
)% | $ | 890 |
$ | 981 |
$ | (91 |
) | (9 |
)% | ||||||||||||||
Advertising |
53 |
55 |
(2 |
) | (4 |
)% | 104 |
112 |
(8 |
) | (7 |
)% | ||||||||||||||||||||
Other |
9 |
17 |
(8 |
) | (47 |
)% | 21 |
34 |
(13 |
) | (38 |
)% | ||||||||||||||||||||
Total Revenues |
501 |
562 |
(61 |
) |
(11 |
)% |
1,015 |
1,127 |
(112 |
) |
(10 |
)% | ||||||||||||||||||||
Operating expenses |
(341 |
) | (411 |
) | 70 |
17 |
% | (685 |
) | (735 |
) | 50 |
7 |
% | ||||||||||||||||||
Selling, general and administrative |
(90 |
) | (67 |
) | (23 |
) | (34 |
)% | (179 |
) | (195 |
) | 16 |
8 |
% | |||||||||||||||||
Segment EBITDA |
$ |
70 |
$ |
84 |
$ |
(14 |
) |
(17 |
)% |
$ |
151 |
$ |
197 |
$ |
(46 |
) |
(23 |
)% | ||||||||||||||
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||||||||||||||||||
2019 |
2018 |
Change |
% Change |
2019 |
2018 |
Change |
% Change |
|||||||||||||||||||||||||
(in millions, except %) |
Better/(Worse) |
Better/(Worse) |
||||||||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||||||||||
Consumer |
$ | 421 |
$ | 478 |
$ | (57 |
) | (12 |
)% | $ | 808 |
$ | 878 |
$ | (70 |
) | (8 |
)% | ||||||||||||||
Other |
21 |
18 |
3 |
17 |
% | 39 |
36 |
3 |
8 |
% | ||||||||||||||||||||||
Total Revenues |
442 |
496 |
(54 |
) |
(11 |
)% |
847 |
914 |
(67 |
) |
(7 |
)% | ||||||||||||||||||||
Operating expenses |
(297 |
) | (322 |
) | 25 |
8 |
% | (576 |
) | (597 |
) | 21 |
4 |
% | ||||||||||||||||||
Selling, general and administrative |
(82 |
) | (86 |
) | 4 |
5 |
% | (159 |
) | (161 |
) | 2 |
1 |
% | ||||||||||||||||||
Segment EBITDA |
$ |
63 |
$ |
88 |
$ |
(25 |
) |
(28 |
)% |
$ |
112 |
$ |
156 |
$ |
(44 |
) |
(28 |
)% | ||||||||||||||
For the three months ended December 31, |
For the six months ended December 31, |
|||||||||||||||||||||||||||||||
2019 |
2018 |
Change |
% Change |
2019 |
2018 |
Change |
% Change |
|||||||||||||||||||||||||
(in millions, except %) |
Better/(Worse) |
Better/(Worse) |
||||||||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||||||||||
Circulation and subscription |
$ | 9 |
$ | 13 |
$ | (4 |
) | (31 |
)% | $ | 19 |
$ | 27 |
$ | (8 |
) | (30 |
)% | ||||||||||||||
Advertising |
25 |
31 |
(6 |
) | (19 |
)% | 52 |
62 |
(10 |
) | (16 |
)% | ||||||||||||||||||||
Real estate |
242 |
248 |
(6 |
) | (2 |
)% | 460 |
475 |
(15 |
) | (3 |
)% | ||||||||||||||||||||
Other |
18 |
19 |
(1 |
) | (5 |
)% | 35 |
40 |
(5 |
) | (13 |
)% | ||||||||||||||||||||
Total Revenues |
294 |
311 |
(17 |
) |
(5 |
)% |
566 |
604 |
(38 |
) |
(6 |
)% | ||||||||||||||||||||
Operating expenses |
(42 |
) | (42 |
) | — |
— |
(87 |
) | (77 |
) | (10 |
) | (13 |
)% | ||||||||||||||||||
Selling, general and administrative |
(134 |
) | (148 |
) | 14 |
9 |
% | (279 |
) | (301 |
) | 22 |
7 |
% | ||||||||||||||||||
Segment EBITDA |
$ |
118 |
$ |
121 |
$ |
(3 |
) |
(2 |
)% |
$ |
200 |
$ |
226 |
$ |
(26 |
) |
(12 |
)% | ||||||||||||||
For the six months ended December 31, |
2019 |
2018 |
||||||
Net cash provided by operating activities |
$ | 192 |
$ | 358 |
For the six months ended December 31, |
2019 |
2018 |
||||||
Net cash used in investing activities |
$ | (234 |
) | $ | (409 |
) |
For the six months ended December 31, |
2019 |
2018 |
||||||
Net cash used in financing activities |
$ | (328 |
) | $ | (333 |
) |
For the six months ended December 31, |
||||||||
2019 |
2018 |
|||||||
(in millions) |
||||||||
Net cash provided by operating activities |
$ | 192 |
$ | 358 |
||||
Less: Capital expenditures |
(237 |
) | (264 |
) | ||||
(45 |
) | 94 |
||||||
Less: REA Group free cash flow |
(86 |
) | (105 |
) | ||||
Plus: Cash dividends received from REA Group |
35 |
37 |
||||||
Free cash flow available to News Corporation |
$ | (96 |
) | $ | 26 |
|||
As of December 31, 2019 |
||||||||||||||||||||
Payments Due by Period |
||||||||||||||||||||
Total |
Less than 1 year |
1-3 years |
3-5 years |
More than 5 years |
||||||||||||||||
(in millions) |
||||||||||||||||||||
Borrowings |
$ | 1,199 |
$ | — |
$ | 875 |
$ | 324 |
$ | — |
||||||||||
Interest payments on borrowings (a) |
$ | 170 |
$ | 50 |
$ | 89 |
$ | 31 |
$ | — |
(a) |
Reflects the Company’s expected future interest payments based on borrowings outstanding and interest rates applicable at December 31, 2019. Such outstanding amounts and rates are subject to change in future periods. See Note 5 —Borrowings in the accompanying Consolidated Financial Statements. |
(a) |
Disclosure Controls and Procedures |
(b) |
Internal Control Over Financial Reporting |
10.1 |
||||
10.2 |
||||
10.3 |
||||
10.4 |
||||
10.5 |
||||
10.6 |
||||
10.7 |
||||
10.8 |
||||
10.9 |
||||
10.10 |
||||
31.1 |
||||
31.2 |
||||
32.1 |
101 |
The following financial information from the Company’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2019 formatted in Inline XBRL: (i) Consolidated Statements of Operations for the three and six months ended December 31, 2019 and 2018 (unaudited); (ii) Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended December 31, 2019 and 2018 (unaudited); (iii) Consolidated Balance Sheets as of December 31, 2019 (unaudited) and June 30, 2019 (audited); (iv) Consolidated Statements of Cash Flows for the six months ended December 31, 2019 and 2018 (unaudited); and (v) Notes to the Unaudited Consolidated Financial Statements.* | |||
104 |
The cover page from News Corporation’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2019, formatted in Inline XBRL (included as Exhibit 101).* |
* | Filed herewith. |
** | Furnished herewith |
NEWS CORPORATION (Registrant) | ||
By: |
/s/ Susan Panuccio | |
Susan Panuccio | ||
Chief Financial Officer |