Foxtel Blames Income Decline On Presto Shutdown & Ten Crisis
Foxtel has reported declines in net income and EBITDA for the financial year ending June 30, contributing to an overall loss of US$643 million for News Corp.
The company said a US$58 million write down of its investment in Ten as well as US$53 million in losses stemming from the decision to close Presto had heavily impacted its net income, which fell to US$59 million for the year compared to $180 million the year prior.
While Foxtel reported a 1% increase in revenue for the year to US$2.411 billion, revenue fell by 2% in local currency “due to lower subscriber volumes”.
These lower subscriber numbers, along with plans to increase spending on programming, particularly sports, saw EBITDA decline by US$36 million to US$568 million.
This comes despite an increase in package prices by up to $4 earlier in the year.
“FOX SPORTS Australia reinforced its leadership in Australia with the successful launch of the Fox League Channel and by extending its domestic soccer rights for another six years,” said News Corp chief executive Robert Thomson.
While the 2.8 million total subscriptions are lower than a year ago, the launch of the Foxtel Now streaming service saw a slight improvement in subscriber numbers compared to the third quarter.
“Foxtel and FOX SPORTS Australia are capitalizing on the growing SVOD market with the recent rollout of its rebranded Foxtel Now streaming service, which has been well received and is improving subscriber volume,” Thomson said.