The long-running price war between the Sun and Daily Mirror has pushed operating income down by 28% for the financial year at News International (NI), the Sun’s parent company.
In the release of its year-end financial results, NI’s owner, News Corporation, said that classified and display advertising revenue gains at the Sun and News Of The World were more than offset by the decline in circulation revenues resulting from the cover price cuts.
In Q4, NI saw a 10% fall in operating income, although circulation revenues grew across all titles, as the price war came to an end in the quarter.
Operating profits across the whole of News Corp rose by 26% in Q4, on revenues up by 20%. For the full year, income jumped by 36% to $2.5 billion on revenues up by 15%.
Chairman and chief executive, Rupert Murdoch, described the last twelve months as a record breaking year, with the film, television, cable and book publishing divisions all reporting record profits.
“This past year was not without its challenges, including a cover price war in the UK newspaper market that, while now ended, lasted longer than expected as well as the costs associated with covering the war in Iraq. Our strong results in the face of such obstacles are clear testimony to both the fundamental strength of our company and the resilience of our underlying businesses,” was Murdoch’s confident statement.
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