The true extent of the crisis at News Corp Australia, previously withheld by the company, has been leaked.
The Murdoch press suffered large revenue and profit losses Australia-wide, according to an internal financial document from the 2012-13 financial year.
The confidential document, obtained by independent news outlet Crikey, details the true financial state of The Australian broadsheet and the company’s metropolitan newspapers fourteen months ago – information not previously released to the public.
“The confidential operating accounts for News Corp Australia have never been seen by investors and provide a detailed picture of a print business in rapid decline, with swingeing cost-cuts, cover price increases, new digital subscriptions and digital advertising failing to make up for the loss of revenues from advertising and circulation,” Crikey reports.
Crikey attributes the leak to “a well-placed source” who wishes to correct the public record on the point of News Corp’s profitability.
According to Crikey, revenue from News Corp’s Australian newspapers fell 14 per cent to $1.9 billion, and operating income fell 67 per cent to $94 million, in the financial year before last.
The company’s report to the Australian stock exchange for this same period lists $6.7 billion in revenue under the broad category of “News and Information services”.
Earlier in the year, ABC’s Media Watch reported that the company’s flagship broadsheet The Australian was losing between $40 and $50 million a year. It later corrected this report at the urging of News Corp, which said the figure was incorrect.
The Australian‘s Editor-in-Chief Chris Mitchell conceded in a video interview at the time that the broadsheet is “probably not a profitable business”, but described the multi-million dollar figure as “completely incorrect”. He projected the expected loss in 2013-14 as closer to $15 million.
In its correction, the ABC revised its estimate of the newspaper’s loss in 2012-13 to $30 million, a figure that Mr Mitchell has neither confirmed nor denied.
According to Crikey’s interpretation of the leaked document, The Australian’s revenue fell by $27 million, a reduction of 20 per cent on the previous financial year, and lost $8 million in operating income (down 41 per cent), bringing its total operating loss to $30 million after depreciation, and confirming the ABC estimate.
Brisbane’s The Courier-Mail posted the worst result, according to Crikey – 18 per cent less revenue (dropping to $158 million) and 68 per cent less operating income (to $17 million).
Sydney’s Daily Telegraph also suffered. Its weekday edition generated 14 per cent less revenue (to $160 million) and 65 per cent less operating income (to just $8 million), while the Sunday Telegraph’s revenues fell 15 per cent to $94 million and operating income was down 53 per cent to $7 million.
Adelaide’s Advertiser performed slightly better in 2012-13, with revenues down 15 per cent (to $138 million) and operating income down 47 per cent (to $22 million).
Melbourne’s The Herald Sun‘s weekday edition was a better performer, generating only 13.5 per cent less revenue (a fall to $250 million) and 41 per cent less operating income (to $35 million) than the year before. Its Sunday edition fared worse – 17 per cent less revenue (to $75 million) and 31 per cent less operating income (to $21 million).
In its latest public report released in August, News Corp revealed a total revenue decline of 18 per cent on the previous year across its Australian newspapers, attributing 10 per cent of this loss to fluctuations in the value of the Australian dollar.
The Australian, by its own admission, has not made a profit since the global financial crisis in 2008, and is the worst performing newspaper in the News Corp stable based on the leaked document.