SYDNEY, Australia - Declining circulation and advertising in its newspaper divisions in Australia and the UK have plunged Rupert Murdoch's News Corp well into the red.
Bottom line losses however have been significantly impacted by write downs in the value of the company's assets.
The write downs have not however been restricted to News Corp's newspaper businesses, but have extended to its 50% share in Australia's most dominant cable TV network, Foxtel.
The only shining light in the company's inventory is the REA real estate group, which accounted for 40% of News Corp's 2016/17 gross profit. REA was introduced to the company by Lachlan Murdock when he was on a sabbatical in Australia.
Another encouraging sign is the company's growth in its digital subscribers, which in the case of The Wall Street Journal has now surpassed the one million mark.
Total losses for the year amounted to a whopping $US643 million, or $817 million Australian dollars.
A write down of $US310 million for News Corp's Australian newspapers accounted for almost half the loss.
Revenue for the company's newspapers in all countries dropped only 5%, however on a figure of just over $US5 billion, this amounts to $US269 million.
Foxtel, considered a cash cow until recently, made just $US59 million compared to $US180 million the previous year. Part of its loss can be attributed to a massive write down in the value of its investment in the free-to-air telecaster, the Ten Network, which has gone into receivership. Surprisingly, Foxtel also shed 100,000 subscribers, falling from 2.9 million to 2.8 million.
News Corp on Friday said it was considering more job cuts in its newspaper division, which covers The Sun, and The Times in London, The Wall Street Journal, and Australian mastheads including The Australian, The Daily Telegraph, The Herald Sun and The Courier-Mail.
The UK newspapers, The Sun and The Times, were written down by $US464 million, significantly more than the Australian newspaper section, which is surprising considering News Corp owns two thirds of newspapers sold in Australia, compared to the UK division which has only two newspapers.