In a surprising change of policy, News Corp is revealing for the first time the size of its Australian, US and UK newspaper revenues by publishing figures for the year to June. The disclosures are in the company’s 10K filing with the US Securities and Exchange Commission, released Tuesday morning in Australia. The detailed information immediately raised questions about why this “breakthrough” occurred at one of the world’s most opaque listed companies. Companies usually provide this sort of data (especially after years of not doing so) ahead of a major change in policy or approach.

 News has also published, for the first time, circulation figures for its Australian capital city papers (to the end of December 2016), for the UK (to the end of June), and The Wall Street Journal and the New York Post. There were no comparative figures given, so we have no way of knowing the performance during the year except for News telling last week’s profit briefing that digital subscriptions in the US, Australia and the UK had risen in the June year (up to 360,000 in Australia, from 272,000 a year earlier).

[Exclusive docs show News’ Australian papers dragging down the empire]

At News Corp Australia revenues at the Australian newspapers were US$1.271 billion (A$1.62 billion), in 2016-17, down US$21 million or 2% from 2015-16 revenues of US$1.292 billion. The impact of foreign currency fluctuations of the US dollar against local currencies and the absence of the 53rd week in fiscal 2017 resulted in a revenue increase of US$43 million, or 3%, in 2017 and a revenue fall of US$21 million, or 2% for the 2016 financial year. Advertising revenues fell US$46 million, primarily as a result of the US$94 million impact of weakness in the print advertising market, lower advertising revenues of US$16 million from the Perth’s The Sunday Times, which was sold to Seven West Media in late 2016, and the US$14 million impact from the absence of the 53rd week in fiscal 2017. These falls “were partially offset by the acquisition of ARM (formerly the regional papers owned by APN), which contributed US$42 million to advertising revenues, and the US$25 million positive impact of foreign currency fluctuations”. 

But News UK recorded the biggest hit, thanks to Brexit. 2016-17 newspaper revenues were US$1.037 billion (A$1.32 billion), down US$244 million, or 19%, as compared to fiscal 2016 revenues of US$1.281 billion. Advertising revenues dropped US$114 million, “primarily due to the US$52 million negative impact of foreign currency fluctuations and the US$51 million impact from weakness in the print advertising” (that’s US$1 million a week). Circulation and subscription revenues fell US$111 million, “primarily due to the US$96 million negative impact of foreign currency fluctuations and the US$13 million impact from the absence of the 53rd week in fiscal 2017, as the US$33 million impact of single-copy volume declines, primarily at The Sun, was offset by the US$32 million impact of cover price increases across The Sun and The Times”.

[News Corp’s print figures looking more like obituary]

Overall revenue from News and Information fell US$269 million, or 5%, to US$5.069 billion (A$6.45 billion) from US$5.338 billion, thanks to a US$202 million fall in revenue and the loss of the US$33 million contribution from the extra week in 2015-16, as well as the US$16 million lost from the sale of Perth’s The Sunday Times. Earnings before interest, tax, depreciation and amortisation rose US$200 million or 93% because of the absence of the US$280 million payout in 2015-16 of damages against News America Marketing. There were lower contributions from News Corp Australia, News UK and Dow Jones of US$44 million, US$36 million and US$22 million, respectively, mainly due to the impact of lower advertising revenues. This was partially offset by the impact of cost savings initiatives and lower newsprint, production, editorial and distribution costs.

Fox Sports Australia recorded a US$1 million rise in revenue to US$494 million (A$629 million) for the year to June, while earnings before interest, tax, depreciation and amortisation (EBITDA) fell US$1 million to US$123 million for the June 12 month.

The News Corp SEC filing also reminded us that the News and Information business faces more potential impairments in the coming year after the impairments primarily at News UK and News Corp Australia and Foxtel. Directors said in the filing that “the News and Information Services segment has a reporting unit with goodwill of approximately US$1.4 billion at June 30, 2017 that is at-risk for future impairment. Additionally, the Company has certain other reporting units with goodwill balances of US$83 million which are considered to be at-risk”. Directors also said there are “US$1.2 billion of investments that are at risk for future impairment because the fair values of the corresponding reporting units and investments exceeded their carrying values by less than 3%”. Those investments were not specified.