10-KPeriod: FY2020

Fox Corp Annual Report, Year Ended Jun 30, 2020

Filed August 10, 2020For Securities:FOXAFOX

Summary

Fox Corporation's 2020 10-K highlights a year of strategic growth and adaptation, marked by an 8% increase in total revenues to $12.3 billion, driven by strong performance in both affiliate fees and advertising. The company continued to solidify its core news, sports, and entertainment businesses, with notable performances in its Cable Network Programming segment, which saw an 8% increase in Segment EBITDA. The Television segment experienced an 11% revenue increase, despite a 9% dip in Segment EBITDA, largely due to the significant impact of COVID-19, which disrupted sports events and led to reduced advertising spending. The company also made strategic acquisitions, including Tubi and Credible, to expand its digital footprint and complementary revenue streams. Despite the challenges presented by the COVID-19 pandemic, Fox Corporation demonstrated resilience. The company's financial health remains solid, supported by strong brands, a significant presence in major markets, and a commitment to shareholder returns through stock repurchases and dividends. The report indicates a focus on adapting to evolving media consumption habits and maintaining leadership in live and "appointment-based" content.

Financial Highlights

49 data points
Beta

Revenue

$12.30B

Net Income

$999.00M

8.1% Net Margin

EPS (Diluted)

$1.62

Total Assets

$21.75B

Cash & Equivalents

$4.64B

Free Cash Flow

$2.01B

Financial Statements
Beta
Revenue$12.30B
SG&A Expenses$1.74B
Interest Expense$369.00M
Net Income$999.00M
EPS (Basic)$1.63
EPS (Diluted)$1.62
Shares Outstanding (Diluted)616.00M

Key Highlights

  • 1Total revenues increased by 8% to $12.3 billion in fiscal year 2020, driven by growth in affiliate fees (7%) and advertising (5%).
  • 2Cable Network Programming segment EBITDA grew by 8% to $2.7 billion, supported by higher affiliate fees and cost controls, despite a slight decline in advertising revenue.
  • 3The Television segment saw revenue growth of 11% to $6.7 billion, primarily due to the Super Bowl LIV broadcast and higher affiliate fees, though Segment EBITDA decreased by 9% year-over-year, impacted by COVID-19 disruptions.
  • 4Strategic acquisitions included Tubi, a free ad-supported video-on-demand service, and 67% of Credible, a consumer finance marketplace, to diversify revenue and expand digital offerings.
  • 5The company repurchased approximately 17 million shares of common stock for $600 million in fiscal year 2020 under its $2 billion stock repurchase program.
  • 6Net income attributable to Fox Corporation stockholders decreased by 37% to $999 million, impacted by significant restructuring charges ($425 million related to a USGA programming agreement) and increased operating and SG&A expenses associated with operating as a standalone public company.
  • 7The company highlighted its strong competitive position with premium brands like FOX News and FOX Sports, and its leadership in live sports broadcasting, including NFL and MLB events.

Frequently Asked Questions

Fox Corporation reported an 8% increase in total revenues for fiscal year 2020, reaching $12.3 billion. This growth was driven by higher affiliate fee revenues, up 7%, and advertising revenues, up 5%, reflecting the company's strong brand presence and content.

The COVID-19 pandemic had a notable impact, leading to the postponement or cancellation of sports events and suspension of content production, which affected advertising revenues. Specifically, the Television segment's advertising revenue declined, and the company noted a decrease in local advertising market activity. However, the company also benefited from certain cost reductions and the resumption of some sports programming.

Fox Corporation made significant strategic moves, including the acquisition of Tubi, a free advertising-supported video-on-demand service, and a controlling stake in Credible, a U.S. consumer finance marketplace. These acquisitions aim to enhance its digital presence and diversify revenue streams.

The company continued to focus on shareholder returns, repurchasing approximately $600 million worth of its common stock under a $2 billion repurchase program. It also paid dividends, with a total of $0.46 per share distributed in fiscal year 2020.

The company emphasized its leadership positions in news, sports, and entertainment. The Cable Network Programming segment showed resilience with EBITDA growth, while the Television segment, though facing short-term headwinds from the pandemic, benefited from major events like the Super Bowl. The company is committed to investing in its core programming and exploring digital distribution to adapt to evolving consumer behavior.