Fox reports higher profit, insists no deals in the works
(Reuters) - Twenty-First Century Fox Inc, the film and TV company controlled by Rupert Murdoch, reported a quarterly profit that beat Wall Street's expectations as executives stressed that they would not make a new bid for Time Warner Inc.
Fox on Tuesday withdrew the $80 billion offer that Time Warner had rejected. On Wednesday, Murdoch made a rare appearance on Fox's quarterly earnings call and reinforced that he had ended his pursuit of the rival company.
"This is our resolute decision," Murdoch said. "While we remain opportunistic and nimble, we are a strategically complete company and have a clear sense of where we are going."
Fox has no plans to pursue another content company as an alternative, Chase Carey, the chief operating officer, added.
Shares of Fox rose 4.1 percent at $33.65 in after-hours trading on Wednesday, up from their earlier $32.33 close on Nasdaq.
Despite Fox's announcement on Tuesday that it would no longer pursue a deal with Time Warner, some investors questioned whether the move might be a ploy to drive down the Time Warner stock price and open the way for another bid by Murdoch at a later time.
For the fiscal fourth quarter that ended June 30, Fox reported $1.8 billion in operating income before depreciation and amortization, a 19 percent gain from the same period a year earlier, helped by strong results from the summer blockbuster movie "X-Men: Days of Future Past."
On an adjusted basis, the company earned 42 cents per share, beating analysts' average estimate of 38 cents, according to Thomson Reuters I/B/E/S. Revenue rose 17 percent to $8.42 billion.
Earnings in the film studio nearly tripled from the prior year to $339 million, driven mainly by the X-Men movie - the seventh in the series based on the Marvel Comics series - and the animated film "Rio 2."
The X-Men movie has grossed $740 million since it was released on May 23.
The success of the films, and others such as "The Fault in our Stars," helped the film studio become the first to cross the $3 billion mark in worldwide box office sales this year, the company said.
Fox's cable network business, its largest, saw its earnings rise 11 percent to $1.2 billion, boosted by higher advertising sales and an increase in subscriptions to regional sports channels. Domestic advertising revenue grew 12 percent.
Fox separated from News Corp in June 2013. News Corp retains the former group's print businesses.