News Corp annual profits rise

The media giant reported a rise in annual profits from $2.54bn (£1.57bn) last year to $2.74bn (£1.7bn) this year, as Chairman Rupert Murdoch pledged to do “whatever necessary” to stop something like phone hacking happening within News Corp again.

While its annual profits were up, News Corp’s quarterly profits were down by 22 per cent on the back of selling the MySpace social networking website for more than $500m (£309m) less than it bought the site for in 2005.

It made net profit of $683m (£423m) in the three months to 30 June, down from $875m (£541m) for the same period last year.

News Corp’s UK subsidiary News International was embroiled in the phone-hacking scandal, which ended with the company being forced to close the News of the World.

The repercussions for the business also included dropping its bid to buy the rest of BSkyB that it does not already own.

Challenges ahead

However these events took place just after the period the latest results covers, up to 30 June.

Investors will have to scrutinise the next quarterly figures to see what financial impact the scandal has had, but the ideological impact on News Corp was clear in Mr Murdoch’s accompanying statement.

He said: “While it has been a good quarter from a financial point of view, our company has faced challenges in recent weeks relating to our London tabloid, News of the World.

“We are acting decisively in the matter and will do whatever is necessary to prevent something like this from ever occurring again.

“It is important to note that there has been no material impact on our other operations.”

He said the future of the company is “promising”, adding that one of the fundamental goals at News Corp was to “provide outstanding content and services to customers and consumers – and do it with integrity”.

In a separate development, former News of the World executive Greg Miskiw, who was arrested last night over phone-hacking allegations, has been bailed.