News Corporation Reports Third Quarter Earnings Per Share of $1.22 on Net Income Attributable to Stockholders of $2.85 Billion

  News Corporation Reports Third Quarter Earnings Per Share of $1.22 on Net
  Income Attributable to Stockholders of $2.85 Billion

  Total Segment Operating Income Increases 4% to $1.36 Billion on Revenue of
                                $9.54 Billion

Business Wire

NEW YORK -- May 08, 2013

News Corporation (NASDAQ: NWS, NWSA; ASX: NWS, NWSLV) today reported $9.54
billion of total revenue for the three months ending March 31, 2013, a $1.14
billion or 14% increase over the $8.40 billion of revenue reported in the
prior year quarter. Approximately 55% of the revenue increase reflects growth
at the Cable Network Programming, Filmed Entertainment and Television
segments, partially offset by lower revenues at the Publishing segment. The
balance of the growth primarily relates to the inclusion of Sky Deutschland AG
(“Sky Deutschland”) and Fox Sports Australia revenues.

The Company reported third quarter total segment operating income^(1) of $1.36
billion, as compared to $1.31 billion reported a year ago. The improvement was
led by operating income growth at the Company’s Cable Network Programming,
Filmed Entertainment and Television segments. The third quarter results
included $42 million of costs related to the ongoing investigations initiated
upon the closure of The News of the World as compared to $63 million in the
corresponding period of the prior year. This year’s third quarter results also
included $25 million of costs related to the proposed separation of the
Company’s entertainment and publishing businesses. Excluding these costs from
both years, third quarter adjusted total segment operating income of $1.43
billion increased $54 million or 4% from $1.38 billion reported in the third
quarter of the prior year.

The Company reported quarterly net income attributable to stockholders of
$2.85 billion ($1.22 per share), as compared to $937 million ($0.38 per share)
reported in the corresponding period of the prior year. This quarter’s pre-tax
results included $2.43 billion of income in Other, net, principally related to
gains on the acquisition of an additional ownership stake in Sky Deutschland
and the sale of the ownership stake in SKY Network Television in New Zealand,
as well as a $11 million gain from the Company’s participation in British Sky
Broadcasting’s (“BSkyB”) share repurchase program, which is reflected in
Equity earnings of affiliates. These gains were partially offset by $56
million of restructuring charges, primarily related to the Company’s
international newspaper businesses. Excluding the net income effects of these
items, the costs related to the investigations in the U.K. and the proposed
separation of the Company’s entertainment and publishing businesses, along
with comparable items in both years, third quarter adjusted earnings per
share^(2) was $0.36 versus the adjusted prior year quarter result of $0.37.

Commenting on the results, Chairman and Chief Executive Officer Rupert Murdoch
said:

“In our fiscal third quarter News Corp. achieved organic growth across our
cable, film and television segments and, through the consolidation of Sky
Deutschland and sale of stakes in SKY New Zealand and Phoenix Satellite
Television, we advanced our strategic agenda to simplify our global portfolio.
We also announced our plans to broaden our core cable business with the
unveiling of our national sports channel Fox Sports 1 and our third branded FX
channel, FXX. Both initiatives underscore our strategy of maximizing existing
assets and leadership positions to drive sustainable growth and long-term
value.

“We are on target to complete the proposed separation of our businesses near
the end of our fiscal year. As we prepare to launch two new industry leaders
with new News Corporation and 21st Century Fox, I am more confident than ever
of the long-term value the separation will unlock for the Company and its
shareholders.”

____________________________________________________________

(1) Total segment operating income is a non-GAAP financial measure. See page
11 for a description of total segment operating income and for a
reconciliation of total segment operating income to income before income tax
expense.

(2) See page 14 for a reconciliation of reported net income and earnings per
share to adjusted net income and adjusted earnings per share.

REVIEW OF SEGMENT OPERATING RESULTS
                                                               
Total Segment Operating      3 Months Ended            9 Months Ended
Income (Loss)
                             March 31,                 March 31,
                             2013  2012  2013  2012
                             US $ Millions
                                                                       
Cable Network Programming    $  993       $  846       $  2,891     $  2,503
Filmed Entertainment            289          272          1,072        1,012
Television                      196          171          576          493
Direct Broadcast Satellite      (11   )      40           (8    )      165
Television
Publishing                      85           130          376          458
Other                          (190  )     (147  )     (587  )     (437  )
Total Segment Operating      $  1,362    $  1,312    $  4,320    $  4,194 
Income *
                                                                             

    The three months ended March 31, 2013 and 2012 include $42 million and $63
    million, respectively, of costs related to the ongoing investigations in
    the U.K. The three months ended March 31, 2013 include $25 million of
*  costs related to the proposed separation of the Company’s entertainment
    and publishing businesses. Excluding these charges, adjusted total segment
    operating income is $1,429 and $1,375 million in the three months ended
    March 31, 2013 and 2012, respectively.

    The nine months ended March 31, 2013 and 2012 include $165 million and
    $167 million, respectively, of costs related to the ongoing investigations
    in the U.K. The nine months ended March 31, 2013 include $53 million of
    costs related to the proposed separation of the Company’s entertainment
    and publishing businesses. Excluding these charges, adjusted total segment
    operating income is $4,538 and $4,361 million in the nine months ended
    March 31, 2013 and 2012, respectively.

CABLE NETWORK PROGRAMMING

Cable Network Programming reported quarterly segment operating income of $993
million, a $147 million or 17% increase over the prior year quarter, driven by
a 17% increase in revenue. Operating income contributions from the domestic
channels increased 16%. Revenue growth across all domestic channels, led by
strong growth at the Company’s regional sports networks (“RSNs”) and FX
Networks, was partially offset by increased programming and marketing costs at
the Company’s FX Networks and National Geographic Channels. The Company’s
international cable channels’ quarterly earnings contributions increased 21%
from the same period a year ago, reflecting strong operating profit growth at
the Fox International Channels (“FIC”), partially offset by the adverse impact
of the strengthened U.S. dollar.

Affiliate revenue grew 11% and 42% at the domestic and international cable
channels, respectively. Domestic network growth reflects higher rates across
all networks, led by growth at the RSNs, Fox News Channel and FX Networks.
Approximately 60% of the international affiliate revenue increase reflects
strong local currency growth at the non-sports channels at FIC and STAR. The
balance of the growth was attributable to the new sports channels, including
Fox Star Sports Asia and Eredivisie Media & Marketing CV (“EMM”), partially
offset by the impact of the strengthened U.S. dollar.

Advertising revenue at the domestic cable channels grew 2% in the quarter over
the prior year period driven by double-digit growth at the FX Networks and
National Geographic Channels, partially offset by lower advertising revenues
at the Fox News Channel, due to the absence of the presidential primaries
which occurred in the prior year, and at the RSNs, due to the broadcast of
fewer National Basketball Association (“NBA”) games. Nearly two-thirds of the
international cable channels’ 30% advertising revenue improvement reflects
strong local currency growth at the non-sports channels at FIC and STAR. The
balance of the growth was attributable to the new sports channels, including
Fox Star Sports Asia and EMM networks, partially offset by the impact of the
strengthened U.S. dollar.

Expenses at Cable Network Programming grew 17% in the quarter over the
corresponding period in the prior year. More than two-thirds of this increase
was attributable to the new international sports networks at FIC and STAR,
including the investment in BCCI cricket rights in India. The balance of the
increase was due to higher programming and marketing costs at the FX Networks
and National Geographic Channels, partially offset by reduced NBA rights costs
at the RSNs resulting from the broadcast of fewer games.

FILMED ENTERTAINMENT

Filmed Entertainment reported quarterly segment operating income of $289
million, as compared to $272 million reported in the same period a year ago.
Quarterly results reflect the successful worldwide theatrical and domestic
home entertainment performances of Life of Pi, which has grossed more than
$600 million in worldwide box office and was the winner of 4 Academy Awards,
the most for any film this year. The quarter also included the successful
worldwide home entertainment performances of Taken 2 and Ice Age: Continental
Drift and theatrical release costs for the successful release of The Croods,
the first feature in our DreamWorks Animation distribution deal which has
grossed more than $500 million in worldwide box office to date. Prior year
third quarter film results included the successful worldwide theatrical and
domestic home entertainment performance of Alvin and the Chipmunks:
Chipwrecked and pay-television availability of Rio.

TELEVISION

Television reported quarterly segment operating income of $196 million, an
increase of $25 million or 15% versus the same period a year ago. This
increase reflects a near doubling of retransmission consent revenues and lower
programming costs at the Fox Broadcasting Company. These improvements were
partially offset by lower national and local advertising revenues, primarily
reflecting lower primetime ratings driven by declines at American Idol, now in
its twelfth season.

DIRECT BROADCAST SATELLITE TELEVISION (“DBS”)

DBS generated a quarterly segment operating loss of $11 million, compared to
operating income of $40 million reported in the same period a year ago. The
decline was driven by the consolidation of Sky Deutschland results, following
the Company’s acquisition of an additional 5% ownership stake in this entity
in January 2013, as well as lower contributions from SKY Italia. Revenues
increased $377 million versus the same period a year ago, reflecting the
inclusion of Sky Deutschland revenues. Sky Deutschland grew net subscribers by
approximately 42,000 during the quarter, bringing total direct subscribers to
3.41 million. Quarterly local currency revenue at SKY Italia declined slightly
from the corresponding period of the prior year. SKY Italia experienced a net
reduction of approximately 51,000 subscribers during the quarter, bringing
total subscribers to 4.78 million.

PUBLISHING

Publishing reported quarterly segment operating income of $85 million, a $45
million decrease from the $130 million reported in the same period a year ago.
Increased contributions from the U.K. newspapers, which benefitted from the
launch of the Sunday edition of The Sun in February 2012, were more than
offset by lower advertising revenues at the Australian newspapers and
integrated marketing services businesses.

OTHER

The Other segment quarterly operating loss of $190 million increased from the
$147 million reported in the same period a year ago. The current quarter
included an increased operating loss at Amplify, the Company’s education
business, reflecting higher product development costs. The increased operating
loss was partially offset by a benefit from the consolidation of FOX SPORTS
Australia, net of non-cash amortization, related to the acquisition of the
additional ownership stake in the prior quarter. The current year quarterly
results also included $42 million of costs related to the ongoing
investigations initiated upon the closure of The News of the World, as
compared to $63 million of comparable costs included in the prior year
quarterly results, as well as $25 million of costs related to the proposed
separation of the Company’s entertainment and publishing businesses.

OTHER ITEMS

Sky Deutschland

In January 2013, the Company reached an agreement with Sky Deutschland and its
new bank syndicate to support both a new financing structure and the issuance
of €438 million (approximately $585 million) of new equity, which includes the
outstanding €144 million (approximately $195 million) of equity under the
capital measures announced by Sky Deutschland in February 2012. Sky
Deutschland finalized the equity offering in early February 2013 and the
Company acquired, through a combination of a private placement and a rights
offering, approximately 92 million additional shares of Sky Deutschland
increasing its ownership to approximately 55%. The aggregate cost of the
shares acquired by the Company was approximately €410 million (approximately
$550 million). As a result of these transactions, the results of Sky
Deutschland have been included in the Company’s consolidated results of
operations in the fiscal third quarter of 2013. The carrying amount of the
Company’s previously held equity interest in Sky Deutschland was revalued to
fair value as of the acquisition date, resulting in a gain of approximately
$2.1 billion which was included in Other, net in the unaudited consolidated
statements of operations.

In addition, the Company has guaranteed Sky Deutschland’s new €300 million
(approximately $400 million) five-year bank credit facility, which replaces
Sky Deutschland’s existing bank debt facilities. Additionally, the Company
will act as guarantor to the German Football League for Sky Deutschland’s
Bundesliga broadcasting license for the 2013/14 to 2016/17 seasons in an
amount up to 50% of the license fee per season. The Company has also agreed to
extend the maturity of existing shareholder loans.

SKY Network Television (New Zealand)

In March 2013, the Company sold its 44% equity interest in SKY Network
Television Ltd. for approximately $675 million, net of fees and commissions,
and recorded a gain of approximately $321 million which was included in Other,
net in the unaudited consolidated statements of operations.

Phoenix Satellite Television

In March 2013, the Company sold a portion of its interest in Phoenix Satellite
Television (“Phoenix”), for approximately $90 million in cash. The Company
decreased its interest in Phoenix to approximately 12% from the 18% it owned
at June 30, 2012. The Company recorded a gain of approximately $81 million on
this transaction which was included in Other, net in the unaudited
consolidated statements of operations.

Share repurchases

On May 9, 2012, News Corporation announced that its Board of Directors
approved an increase to the previously authorized stock repurchase program
from $5 billion to $10 billion. Through May 7, 2013, the Company has purchased
more than $6.6 billion of Class A common stock under the program, at an
average price of $19.50 per share. As a result of the stock repurchase
program, diluted weighted Class A shares outstanding of 2,330 million in this
year’s quarter declined 6% from 2,475 million in the same period a year ago.

Intent to pursue separation of entertainment and publishing businesses

On June 28, 2012, News Corporation announced its intent to pursue the
separation of its business into two separate independent companies, one of
which will hold the Company’s global media and entertainment businesses and
the other which will hold the businesses comprising the Company’s newspapers,
information services and integrated marketing services, digital real estate
services, book publishing, digital education and sports programming and pay-TV
distribution in Australia. In addition to final approval from the Board of
Directors and stockholder approval of certain amendments to the Company’s
Restated Certificate of Incorporation, the completion of the separation will
be subject to receipt of regulatory approvals, opinions from tax counsel and
favorable rulings from certain tax jurisdictions regarding the tax-free nature
of the transaction to the Company and to its stockholders, further due
diligence as appropriate, the execution of certain agreements relating to the
distribution, and the filing and effectiveness of appropriate filings with the
SEC. There can be no assurances given that the separation of the Company's
businesses as described will occur.

REVIEW OF EQUITY EARNINGS (LOSSES) OF AFFILIATES’ RESULTS

Quarterly earnings from affiliates were $157 million as compared to $204
million in the same period a year ago. The decreased contributions from
affiliates are primarily due to lower contributions from BSkyB, resulting from
the Company’s pre-tax gain related to the its participation in BSkyB’s share
repurchase declining from $111 million gain in the corresponding period of the
prior year to $11 million in the current quarter. This decrease was partially
offset by the absence of Sky Deutschland operating losses resulting from its
consolidation in the quarter.

The Company’s share of equity earnings (losses) of affiliates is as follows:

                            3 Months Ended           9 Months Ended
                                 March 31,                 March 31,
             % Owned         2013  2012  2013  2012
                                 US $ Millions
BSkyB        39%^(1)             $  160      $  262       $  667      $  577
Other        Various^(2)           (3   )      (58  )      (146  )     (110  )
affiliates
Total
equity
earnings                         $  157      $  204      $  521      $  467   
of
affiliates

(1)  Please refer to BSkyB’s earnings releases for detailed information.
      Primarily comprised of Sky Deutschland (consolidated as of January
(2)   2013), Hulu, Australian and STAR equity affiliates, as well as NDS in
      the prior year.

Foreign Exchange Rates

Average foreign exchange rates used in the quarter-to-date profit results are
as follows:

                                  3 Months Ended
                                   March 31,
                                   2013    2012
                                            
Australian Dollar/U.S. Dollar      1.04     1.06
U.K. Pounds Sterling/U.S. Dollar   1.55     1.57
Euro/U.S. Dollar                   1.32     1.31

To receive a copy of this press release through the Internet, access News
Corporation’s corporate Web site located at http://www.newscorp.com.

Audio from News Corporation’s conference call with analysts on the third
quarter results can be heard live on the Internet at 4:30 p.m. Eastern
Daylight Savings Time today. To listen to the call, visit
http://www.newscorp.com.

Cautionary Statement Concerning Forward-Looking Statements

This document contains certain “forward-looking statements” within the meaning
of the Private Securities Litigation Reform Act of 1995. These statements are
based on management’s views and assumptions regarding future events and
business performance as of the time the statements are made. Actual results
may differ materially from these expectations due to changes in global
economic, business, competitive market and regulatory factors. More detailed
information about these and other factors that could affect future results is
contained in our filings with the Securities and Exchange Commission. The
“forward-looking statements” included in this document are made only as of the
date of this document and we do not have any obligation to publicly update any
“forward-looking statements” to reflect subsequent events or circumstances,
except as required by law.

                                                              
CONSOLIDATED STATEMENTS OF OPERATIONS
                           3 Months Ended            9 Months Ended
                           March 31,                 March 31,
                           2013        2012        2013         2012
                           US $ Millions (except share related amounts)
                                                                     
Revenues                   $ 9,538      $ 8,402      $ 27,099      $ 25,336
                                                                     
                                                                     
Operating expenses           (6,114 )     (5,216 )     (16,831 )     (15,552 )
Selling, general and         (1,705 )     (1,580 )     (4,981  )     (4,721  )
administrative expenses
Depreciation and             (357   )     (294   )     (967    )     (869    )
amortization
Impairment and               (56    )     (27    )     (273    )     (154    )
restructuring charges
Equity earnings of           157          204          521           467
affiliates
Interest expense, net        (276   )     (258   )     (809    )     (773    )
Interest income              32           26           100           91
Other, net                   2,431       27          5,206        22      
Income from continuing
operations before income     3,650        1,284        9,065         3,847
tax expense
Income tax expense           (741   )     (281   )     (1,402  )     (931    )
Net income                   2,909        1,003        7,663         2,916
Less: Net income
attributable to              (55    )     (66    )     (195    )     (184    )
noncontrolling interests
Net income attributable
to News Corporation        $ 2,854     $ 937       $ 7,468      $ 2,732   
stockholders
                                                                     
Weighted average shares:     2,330        2,475        2,348         2,534
                                                                     
Net income attributable
to News Corporation        $ 1.22       $ 0.38       $ 3.18        $ 1.08
stockholders per share:
                                                                     

CONSOLIDATED BALANCE SHEETS                              March 31,  June 30,
                                                          2013       2012
Assets:                                                   US $ Millions
Current assets:
Cash and cash equivalents                                 $  9,324    $ 9,626
Receivables, net                                             7,136      6,608
Inventories, net                                             3,476      2,595
Other                                                       857       619
Total current assets                                        20,793    19,448
                                                                        
Non-current assets:
Receivables                                                  431        387
Investments                                                  6,622      4,968
Inventories, net                                             5,002      4,596
Property, plant and equipment, net                           5,984      5,814
Intangible assets, net                                       8,331      7,133
Goodwill                                                     20,139     13,174
Other non-current assets                                    1,188     1,143
Total assets                                              $  68,490   $ 56,663
                                                                        
                                                                        
Liabilities and Equity:
Current liabilities:
Borrowings                                                $  157      $ 273
Accounts payable, accrued expenses and other current         6,030      5,405
liabilities
Participations, residuals and royalties payable              1,915      1,691
Program rights payable                                       1,776      1,368
Deferred revenue                                            1,175     880
Total current liabilities                                   11,053    9,617
                                                                        
Non-current liabilities:
Borrowings                                                   16,317     15,182
Other liabilities                                            4,279      3,650
Deferred income taxes                                        2,947      2,388
Redeemable noncontrolling interests                          645        641
Commitments and contingencies
Equity:
Class A common stock, $0.01 par value                        15         15
Class B common stock, $0.01 par value                        8          8
Additional paid-in capital                                   15,902     16,140
Retained earnings and accumulated other comprehensive       14,139    8,521
income
Total News Corporation stockholders' equity                  30,064     24,684
Noncontrolling interests                                    3,185     501
Total equity                                                33,249    25,185
Total liabilities and equity                              $  68,490   $ 56,663
                                                                        

CONSOLIDATED STATEMENTS OF CASH FLOWS                             
                                                      9 Months Ended March 31,
                                                        2013       2012
                                                      US $ Millions
Operating activities:
Net Income                                            $  7,663      $ 2,916
Adjustments to reconcile net income to cash provided
by operating activities:
Depreciation and amortization                            967          869
Amortization of cable distribution investments           67           69
Equity earnings of affiliates                            (521   )     (467   )
Cash distributions received from affiliates              311          313
Impairment charges, net of tax                           35           10
Other, net                                               (5,206 )     (22    )
Change in operating assets and liabilities, net of
acquisitions:
Receivables and other assets                             (295   )     (551   )
Inventories, net                                         (1,043 )     (577   )
Accounts payable and other liabilities                  785        161    
Net cash provided by operating activities               2,763      2,721  
                                                                      
Investing activities:
Property, plant and equipment, net of acquisitions       (627   )     (651   )
Acquisitions, net of cash acquired                       (2,746 )     (532   )
Investments in equity affiliates                         (618   )     (14    )
Other investments                                        (63    )     (198   )
Proceeds from dispositions                              2,670      408    
Net cash used in investing activities                   (1,384 )    (987   )
                                                                      
Financing activities:
Borrowings                                               1,277        -
Repayment of borrowings                                  (989   )     (32    )
Issuance of shares                                       170          87
Repurchase of shares                                     (1,834 )     (3,294 )
Dividends paid                                           (384   )     (323   )
Purchase of subsidiary shares from noncontrolling        (9     )     -
interests
Other, net                                              70         -      
Net cash used in financing activities                   (1,699 )    (3,562 )
                                                                      
Net decrease in cash and cash equivalents                (320   )     (1,828 )
Cash and cash equivalents, beginning of period           9,626        12,680
Exchange movement on opening cash balance               18         (166   )
Cash and cash equivalents, end of period              $  9,324     $ 10,686 
                                                                             

SEGMENT INFORMATION           3 Months Ended         9 Months Ended
                               March 31,               March 31,
                               2013       2012       2013        2012
                               US $ Millions
Revenues                                                         
                                                                      
Cable Network Programming      $ 2,782     $ 2,375     $ 7,790      $ 6,656
Filmed Entertainment             2,014       1,722       5,826        5,563
Television                       1,225       1,208       3,716        3,651
Direct Broadcast Satellite       1,300       923         3,007        2,792
Television
Publishing                       1,938       2,025       6,105        6,224
Other                           279       149       655        450    
Total Revenues                 $ 9,538    $ 8,402    $ 27,099    $ 25,336 
                                                                      
                                                                      
Segment Operating Income
(Loss)
                                                                      
Cable Network Programming      $ 993       $ 846       $ 2,891      $ 2,503
Filmed Entertainment             289         272         1,072        1,012
Television                       196         171         576          493
Direct Broadcast Satellite       (11   )     40          (8     )     165
Television
Publishing                       85          130         376          458
Other                           (190  )    (147  )    (587   )    (437   )
Total Segment Operating        $ 1,362    $ 1,312    $ 4,320     $ 4,194  
Income *
                                                                             

    The three months ended March 31, 2013 and 2012 include $42 million and $63
    million, respectively, of costs related to the ongoing investigations in
    the U.K. The three months ended March 31, 2013 include $25 million of
*  costs related to the proposed separation of the Company’s entertainment
    and publishing businesses. Excluding these charges, adjusted total segment
    operating income is $1,429 and $1,375 million in the three months ended
    March 31, 2013 and 2012, respectively.

    The nine months ended March 31, 2013 and 2012 include $165 million and
    $167 million, respectively, of costs related to the ongoing investigations
    in the U.K. The nine months ended March 31, 2013 include $53 million of
    costs related to the proposed separation of the Company’s entertainment
    and publishing businesses. Excluding these charges, adjusted total segment
    operating income is $4,538 and $4,361 million in the nine months ended
    March 31, 2013 and 2012, respectively.

NOTE 1 – TOTAL SEGMENT OPERATING INCOME AND SEGMENT OPERATING INCOME BEFORE
DEPRECIATION AND AMORTIZATION

The Company evaluates the performance of its operating segments based on
segment operating income, and management uses total segment operating income
as a measure of the performance of operating businesses separate from
non-operating factors. Total segment operating income and segment operating
income before depreciation and amortization are non-GAAP measures and should
be considered in addition to, not as a substitute for, net income, cash flow
and other measures of financial performance reported in accordance with GAAP.
In addition, these measures do not reflect cash available to fund
requirements. These measures exclude items, such as impairment and
restructuring charges, which are significant components in assessing the
Company’s financial performance. Segment operating income before depreciation
and amortization also excludes depreciation and amortization which are also
significant components in assessing the Company’s financial performance.

Management believes that total segment operating income and segment operating
income before depreciation and amortization are appropriate measures for
evaluating the operating performance of the Company’s business and provide
investors and equity analysts a measure to analyze operating performance of
the Company’s business and enterprise value against historical data and
competitors’ data. Total segment operating income and segment operating income
before depreciation and amortization is the primary measure used by our chief
operating decision maker to evaluate the performance of and allocate resources
to the Company’s business segments.

Total segment operating income does not include: Impairment and restructuring
charges, discontinued operations, Equity earnings of affiliates, Interest
expense, net, Interest income, Other, net, Income tax expense and Net income
attributable to noncontrolling interests.

Segment operating income before depreciation and amortization is defined as
segment operating income plus depreciation and amortization and the
amortization of cable distribution investments and eliminates the variable
effect across all business segments of depreciation and amortization.
Depreciation and amortization expense includes the depreciation of property
and equipment, as well as amortization of finite-lived intangible assets.
Amortization of cable distribution investments represents a reduction against
revenues over the term of a carriage arrangement and, as such, it is excluded
from segment operating income before depreciation and amortization.

The following table reconciles segment operating income before depreciation
and amortization to income from continuing operations before income tax
expense.

                                3 Months Ended         9 Months Ended
                                 March 31,               March 31,
                                 2013       2012       2013       2012
                                 US $ Millions
                                                                  
Segment Operating income
before depreciation and          $ 1,742     $ 1,628     $ 5,354     $ 5,132
amortization
Depreciation and amortization      (357  )     (294  )     (967  )     (869  )
Amortization of cable             (23   )    (22   )    (67   )    (69   )
distribution investments
Total Segment Operating income     1,362       1,312       4,320       4,194
Impairment and restructuring       (56   )     (27   )     (273  )     (154  )
charges
Equity earnings of affiliates      157         204         521         467
Interest expense, net              (276  )     (258  )     (809  )     (773  )
Interest income                    32          26          100         91
Other, net                        2,431     27        5,206     22    
Income from continuing
operations before income tax     $ 3,650    $ 1,284    $ 9,065    $ 3,847 
expense
                                                                             

                  For the Three Months Ended March 31, 2013
                   (US $ Millions)
                   Segment                                      
                   Operating
                   income (loss)   Depreciation   Amortization of   Segment
                   before
                   depreciation    and            cable             Operating
                   and                            distribution      income
                   amortization    amortization   investments       (loss)
Cable Network      $   1,069       $   (53   )    $    (23    )     $  993
Programming
Filmed                 321             (32   )         -               289
Entertainment
Television             219             (23   )         -               196
Direct Broadcast
Satellite              90              (101  )         -               (11   )
Television
Publishing             203             (118  )         -               85
Other                 (160   )       (30   )        -             (190  )
Consolidated       $   1,742      $   (357  )    $    (23    )     $  1,362 
Total
                                                                       

                  For the Three Months Ended March 31, 2012
                   (US $ Millions)
                   Segment                                      
                   Operating
                   income (loss)   Depreciation   Amortization of   Segment
                   before
                   depreciation    and            cable             Operating
                   and                            distribution      income
                   amortization    amortization   investments       (loss)
Cable Network      $   910         $   (42   )    $    (22    )     $  846
Programming
Filmed                 305             (33   )         -               272
Entertainment
Television             192             (21   )         -               171
Direct Broadcast
Satellite              116             (76   )         -               40
Television
Publishing             236             (106  )         -               130
Other                 (131   )       (16   )        -             (147  )
Consolidated       $   1,628      $   (294  )    $    (22    )     $  1,312 
Total
                                                                             

                  For the Nine Months Ended March 31, 2013
                   (US $ Millions)
                   Segment                                      
                   Operating
                   income (loss)   Depreciation   Amortization of   Segment
                   before
                   depreciation    and            cable             Operating
                   and                            distribution      income
                   amortization    amortization   investments       (loss)
Cable Network      $   3,098       $   (140  )    $    (67    )     $  2,891
Programming
Filmed                 1,170           (98   )         -               1,072
Entertainment
Television             642             (66   )         -               576
Direct Broadcast
Satellite              241             (249  )         -               (8    )
Television
Publishing             724             (348  )         -               376
Other                 (521   )       (66   )        -             (587  )
Consolidated       $   5,354      $   (967  )    $    (67    )     $  4,320 
Total
                                                                             

                  For the Nine Months Ended March 31, 2012
                   (US $ Millions)
                   Segment                                      
                   Operating
                   income (loss)   Depreciation   Amortization of   Segment
                   before
                   depreciation    and            cable             Operating
                   and                            distribution      income
                   amortization    amortization   investments       (loss)
Cable Network      $   2,689       $   (117  )    $    (69    )     $  2,503
Programming
Filmed                 1,107           (95   )         -               1,012
Entertainment
Television             556             (63   )         -               493
Direct Broadcast
Satellite              393             (228  )         -               165
Television
Publishing             777             (319  )         -               458
Other                 (390   )       (47   )        -             (437  )
Consolidated       $   5,132      $   (869  )    $    (69    )     $  4,194 
Total
                                                                             

NOTE 2 – ADJUSTED NET INCOME AND ADJUSTED EPS

The Company uses net income and earnings per share excluding Segment operating
profit adjustments, Impairment and restructuring charges, Equity affiliate
adjustments, “Other, net”, and discontinued operations, net of tax (“adjusted
net income and adjusted diluted earnings per share”) to evaluate the
performance of the Company’s operations exclusive of certain items that impact
the comparability of results from period to period. The calculation of
adjusted net income and adjusted diluted earnings per share may not be
comparable to similarly titled measures reported by other companies, since
companies and investors may differ as to what type of events warrant
adjustment. Adjusted net income and adjusted diluted earnings per share are
not measures of performance under generally accepted accounting principles and
should not be construed as substitutes for consolidated net income and
earnings per share as determined under GAAP as a measure of performance.
However, management uses these measures in comparing the Company’s historical
performance and believes that they provide meaningful and comparable
information to investors to assist in their analysis of our performance
relative to prior periods and our competitors.

The following tables reconcile reported net income and reported diluted
earnings per share (“EPS”) to adjusted net income and adjusted diluted
earnings per share for the three months ended March 31, 2013 and 2012.

                      3 Months Ended               3 Months Ended
                       March 31, 2013                March 31, 2012
                       Net income                   Net income    
                       attributable to               attributable
                                                     to
                       stockholders     EPS        stockholders   EPS
                       (in US$ millions, except per share data)
                                                                       
As reported            $   2,854         $ 1.22      $     937       $ 0.38
                                                                       
Segment operating
profit adjustments
(net of provision
for income taxes of
$15 and $19 for the        52              0.02            44          0.02
three months ended
March 31, 2013 and
2012,
respectively)^(a)
                                                                       
Impairment and
restructuring
charges (net of
provision for income
taxes of $15 and $4        41              0.02            23          0.01
for the three months
ended March 31, 2013
and 2012,
respectively)
                                                                       
Equity affiliate
adjustments (net of
provision for income
taxes of $3 and $45        (8       )      -               (66  )      (0.03 )
for the three months
ended March 31, 2013
and 2012,
respectively)^(b)
                                                                       
Other, net (net of
provision for income
taxes of $325 and          (2,106   )      (0.90 )         (17  )      (0.01 )
$10 for the three
months ended March
31, 2013 and 2012)
                                                                       
Other/Rounding            1                                     
As adjusted            $   834          $ 0.36     $     921      $ 0.37  
                                                                             

      Segment operating profit for the three months ended March 31, 2013 and
      2012 was adjusted to exclude the expenses related to the ongoing
(a)  investigations initiated upon the closure of The News of the World. The
      three months ended March 31, 2013 were also adjusted to exclude the
      expenses related to separation of the Company’s entertainment and
      publishing businesses.
      Equity earnings of affiliates for the three months ended March 31, 2013
(b)   and 2012 was adjusted to exclude from BSkyB results News Corporation’s
      gain on the BSkyB repurchase program.

Contact:

News Corporation
Investor Relations:
Reed Nolte, 212-852-7092
Joe Dorrego, 212-852-7856
or
Press Inquiries:
Julie Henderson, 310-369-0773
Nathaniel Brown, 212-852-7746
Dan Berger, 310-369-1274
 
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