Twenty-First Century Fox 2011 Annual Report Download - page 19

Download and view the complete annual report

Please find page 19 of the 2011 Twenty-First Century Fox annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)
Other, net–
2011 2010
For the years ended June 30, (in millions)
Gain on STAR China transaction(a) $ 55 $ —
Loss on disposal of Fox Mobile(a) (29) —
Loss on early extinguishment of debt(b) (36) —
Gain on the sale of eastern European television stations(a) — 195
Gain (loss) on the financial indexes business transaction(a) 43 (23)
Loss on Photobucket transaction(a) — (32)
Impairment of cost based investments(c) — (3)
Change in fair value of exchangeable and convertible securities(c)(d) 46 3
Other (61) (71)
Total Other, net $ 18 $ 69
(a) See Note 3 to the Consolidated Financial Statements of News Corporation.
(b) See Note 10 to the Consolidated Financial Statements of News Corporation.
(c) See Note 6 to the Consolidated Financial Statements of News Corporation.
(d) The Company had certain exchangeable debt securities which contained embedded derivatives. Pursuant to ASC 815 “Derivatives and Hedging” (“ASC 815”), these embedded derivatives
were not designated as hedges and, as such, changes in their fair value were recognized in Other, net in the consolidated statements of operations. The Company redeemed the exchangeable
debt securities in fiscal 2010. (See Note 11 to the Consolidated Financial Statements of News Corporation.)
Income tax expense–The Company’s tax provision and related tax rate for the fiscal year ended June 30, 2011 were lower than the statutory rate
primarily due to permanent differences, the tax benefit related to the disposition of assets and the resolution of tax matters.
The Company’s tax provision and related tax rate for the fiscal year ended June 30, 2010 were lower than the statutory rate primarily due to
the recognition of prior year tax credits, permanent differences and the recognition of tax assets on the disposition of certain assets. The
recognition of prior year tax credits relates to the Company’s election to credit certain prior year taxes instead of claiming deductions.
Loss on disposition of discontinued operations, net of tax–In June 2011, the Company transferred the equity and related assets of Myspace to
a digital media company in exchange for an equity interest in the acquirer. The loss on this transaction was approximately $254 million, net of a
tax benefit of $61 million, or ($0.10) per diluted share and was included in loss on disposition of discontinued operations, net of tax in the
consolidated statements of operations for the fiscal year ended June 30, 2011.
Net income–Net income increased for the fiscal year ended June 30, 2011 as compared to fiscal 2010, primarily due to the higher revenues and
lower litigation settlement costs noted above, partially offset by the loss on the Myspace transaction.
Net income attributable to noncontrolling interests–Net income attributable to noncontrolling interests increased for the fiscal year ended
June 30, 2011 as compared to fiscal 2010, primarily due to higher results at the Company’s majority owned businesses.
2011 Annual Report 17