By Marcus Webb
Murdoch’s media conglomerate announces biggest loss in Australian corporate history.
News Corporation, the media conglomerate controlled by Rupert Murdoch, has reported a quarterly net loss of US$1.74 billion - the biggest in Australian corporate history. The firm blamed an annual net loss of $6.3bn largely on its decision to revalue an investment in interactive television services company Gemstar. Shares in Gemstar, in which News Corp has a 42% stake, have halved since the firm in June lost a court battle over a claim of patent infringement on its interactive programme guide. In all, News Corp wrote off $6.9bn in investments. As part of this, the value of holdings in pay-TV broadcasters KirchMedia in Germany and Stream in Italy were also adjusted downwards. "Obviously we were disappointed by the writedowns," said Murdoch as he announced the loss. But the media magnate raised hopes of a turnaround at Gemstar, saying News Corp executives were "working closely" with managers at the business to "take the necessary steps to restore the value of that important asset". The company said it was seeing improvement in advertising despite a "sluggish" start to its fiscal year amid "extremely difficult operating conditions." Executives now claim News Corp is "in an excellent position for continued profit improvement". New Corp's film arm, which includes Twentieth Century Fox, saw profits rise by $208m to $473m for the year, buoyed by the box office success of Moulin Rouge and Behind Enemy Lines, plus the syndication of Buffy the Vampire Slayer. And the Fox Television Stations unit saw profits rise by $26m, as the "improving" ad market and syndication success of the Seinfeld comedy series boosted earnings.