Good day, everyone and welcome to News Corp Third Quarter Fiscal ‘18 Earnings Conference Call. Today's conference is being recorded. At this time, I'd like to turn the call over to Michael Florin, Senior Vice President and Head of Investor Relations. Please go ahead sir.

Thank you very much, Sophie. Hello everyone and welcome to News Corp's fiscal third quarter 2018 earnings call. We issued our earnings press release about an hour ago and it's now posted on our website at newscorp.com. On the call today are Robert Thomson, Chief Executive; and Susan Panuccio, Chief Financial Officer. We'll open with some prepared remarks and then we'll be happy to take questions from the investment community. This call may include certain forward-looking information with respect to News Corp's business and strategy. Actual results could differ materially from what is said. News Corp's Form 10-K and Form 10-Q filings identify risks and uncertainties that could cause actual results to differ and contain cautionary statements regarding forward-looking information. Additionally, this call will include certain non-GAAP financial measurements such as total segment EBITDA, adjusted segment EBITDA, and adjusted EPS. The definitions and GAAP to non-GAAP reconciliations of such measures can be found in our earnings release. With that, I will pass it over to Robert Thomson for some opening comments.

Thank you, Mike. In the third quarter, we again saw strong results across the company with revenue growth in every segment. In fact, we experienced higher growth in the third quarter than in any quarter since our rebirth as the new News in 2013. The company continues to deliver on its strategic mission to become increasingly global and digital with an ever greater focus on collaboration and innovation and that focus is evident from this quarter's results. We are particularly pleased with the progress in digital real estate where revenues grew 27% and we fortified the business for future growth. Revenues for the quarter were $2.1 billion, representing a 6% increase year-over-year. Total segment EBITDA for Q3 was $182 million, a 15% decline from last year, a result that was impacted by certain singular items, which Susan will momentarily detail. It is worth highlighting that for the first nine months, reported revenues were 6.3 billion, up 4% year-over-year and total segment EBITDA was $760 million, up 13% on the equivalent period last year. Reported earnings in the third quarter were affected by non-cash write downs of 998 million related to Foxtel and Fox Sports Australia. As was previously disclosed in March, non-cash impairment charges of $165 million related to News America marketing. Starting with the fourth quarter, the combination of the digital real estate services and cable TV businesses is expected to account for significantly more than half of our profits. The Foxtel, Fox Sports Australia consolidation is also expected to make circulation and subscription revenues, the biggest revenue stream for News Corp for the first time. This should give us more protection against the vicissitudes of a volatile advertising market. The social and political debate over the digital platforms and their influence has intensified in recent months as is…

Thank you, Robert. Turning to the financials, fiscal 2018 third quarter total revenues were $2.1 billion, up 6% compared to the prior year with revenue gains across the portfolio led by our digital real estate services segment. Reported total segment EBITDA was $182 million, down from $215 million in the prior year. For the quarter, we reported a loss per share of $1.94 compared to a loss of $1 in the prior year. The loss was primarily driven by the pretax non-cash write downs of $998 million related to Foxtel and Fox Sports Australia. As we communicated in March, an impairment related to News America Marketing, which totaled $165 million. On an adjusted basis which excludes those and the other items shown in the press release reconciliation table, earnings per share was $0.06 compared to $0.07 in the prior year. As Robert mentioned, we close the Foxtel transaction at the beginning of the fourth quarter and those results will be consolidated with Fox Sports Australia during quarter four which I will discuss in a few moments. Twenty now to the individual operating segments. In news and information services, revenues for the quarter were $1.3 billion, up 2% versus the prior year, slightly improved rate over the previous quarter. Foreign exchange contributed $50 million this quarter to revenues. Within segment revenues, advertising revenues were down 3% and circulation and subscription revenues increased 7% with foreign currency benefiting advertising by 3% and circulation and subscription revenues by 5%. Within the segment, reported revenues at Dow Jones rose 4%, News UK rose 10%, News Australia declined 3% and News American marketing fell 5%. More revenue details will be provided in the 10-Q filing tomorrow. News and information segment EBITDA this quarter was $85 million, down 31% versus the prior year. You may also…

[Operator Instructions] And we'll take our first question from Alexia Quadrani with JPMorgan.

I was curious, if given all the changes in sort of the broader media industry, specifically, the M&A amongst many of the other media peers, has it influenced your longer term strategic outlook for your business? Do you think you are in the right size, right asset mix? I know you've got a lot of different things planned at different parts of your business, but it's sort of a bigger picture question.

Well, Alexia, we're constantly reviewing our situation and opportunities that may or may not arise. What we certainly won’t be doing is paying silly money for overpriced, overhyped targets. As you can see with the investments we’ve made thus far with realtor, with Harlequin, we've been able to use our existing assets to transform their value and that has been of benefit obviously to the company, but most importantly, to shareholders and we'll certainly always have shareholders in mind when contemplating any potential investments.

Next question comes from Kane Hannan with Goldman Sachs.

Can you just update us on the progress you’ve been making, pushing to the New York market and then whether that was the main driver of the increased customers you called out in the release?

Certainly, we’re rare making genuine inroads it into New York where historically realtor.com hasn't had a particularly powerful presence and overall, the audience at realtor in the quarter was 61 million monthly. That was up 10% in April. 65 million. So we're still seeing a continued growth, not only in New York, but around the country. And there's much discussion at the moment about the general health of the housing market in the US. So listing volumes down about 7.2% year-on-year at present. But when you look at the broader trends in the US economy, we're clearly going through a phase or at least I would argue on route to significantly more liquidity. The March seasonally adjusted annualized figures for sales around 5.6 million, the median sales price was up 5.8% to around 250,400. And significantly, the number of homes in the US seriously underwater in Q2 2012, that was 28.6 of US homes seriously underwater, that's down to 9.5% of homes. And given the issue with the market at the moment is not a problem of the demand, but a problem with supply and a compounding factor in the past has been a lack of job security, what -- with the strength in the US job market, you will see more people more confident about moving homes to a better job, job really means mobility, mobility means people moving and that will be good for business.

Next question comes from John Janedis with Jefferies.

I was hoping you could give a little bit more detail on digital subscription growth at the journal, where you’re incrementally more promotional during the quarter to drive subs, where are you sourcing them from and bigger picture, you have obviously been vocal on Google and Facebook, any thoughts there on movement in terms of monetization of news content on digital platforms?

John, entitled digital paid subscribers at the journal were up 24%, so they're now 62% of overall subs. We're seeing a broad based interest in the journal, obviously, it's a business oriented publication, but also one with general appeal for a certain demographic and that is quite broad. The other thing to bear in mind with those subscriptions is that each of them is an opportunity to upsell to higher priced, higher yielding professional information. From a broader perspective, our concern has not just been for publications, which of course is our prime concern, but also for an ecosystem, which was digitally dysfunctional, one in which premium content was actually diminished in stature by the very fact that in Google searches, you won’t basically able to find it. That has changed and we applaud that measure by Google, but as I mentioned, that's really step one on the pathway to prominence. So we're engaged and thankfully these days, unlike the past, many more publishers are engaged, not only in the US, but globally and also more governments are engaged in the debate over what the digital landscape should like. And with more focus on that ecosystem, more focus on prominence, there should be more opportunity for us for more profits.

I think I’d just also add to your question as well, we are obviously looking to expand the offering internationally in the education with students as well, but what is pleasing is the ARPU is holding up so I think that's important even as we go to this broader base. I think the other part to your question was about our office and I think it's important to note that we haven't changed our intro office in the US. So I have to remain consistent with starting that obviously that digital growth and the ARPU growth.

The next question comes from [indiscernible].

My question is around the new subscription video services segment. Could you give us some idea on the expectations for cost growth within the segment, given in FY19, so looking beyond the current year, particularly given the acquisition of the cricket rights? And I know you've obviously spoken about using over the top products in a dedicated cricket channel but just interested in whether you think you can regroup those costs?

Clearly, a problem for Foxtel and Fox Sports has been the sum allowed where they wanting the compelling sports offering, which is why we acquired the cricket rights for six years and one, cost of that sum alone a lot has been significant churn. And with churn comes cost. So we are very confident that the team will put together a compelling summer package that will make Foxtel a year round experience. It’s a little early for us to give you details -- meaningful details about the level of investment in the coming, year as Susan mentioned, we will be focusing on the development of OTT and frankly addressing issues that in the past have been problematic at Foxtel around the user interface, we want a user interface that is not in your face. And there is a real opportunity, given the new structure at Foxtel, the clearer management lines and the new team under the leadership of Patrick Delaney to take advantage of what is a peerless portfolio of sports and entertainment rights.

And I think I’ll sort of just add, our key priorities, whilst we don’t give out guidance obviously on cost going forward and what that may look like, is to stabilize the broadcast proposition and cricket is clearly going to be an important of that as Robert mentioned, particularly over the summer months to have a look at churn and the portfolio going forward. We are looking to expand the rollout of the [indiscernible] and invest in the new box going forward and so that will be something that you will see going forward and we're also looking to improve the customer service obviously to get more customers in. We’ve also mention that we're looking to expand the OTT propositions and we want to look at sports as well as non-sports genre, but we also are right sizing the cost base. So, there's been a lot of cost work actually done today, so even before the merger happened and the pain down there is still heavily focused on looking at getting costs out, so they can balance that up with the reinvestment that we're looking at. So, there's going to be lots of activity obviously that's going to happen going forward, but it always in the quest to drive subscribers at a higher value going forward.

Next question comes from Eric Katz with Wells Fargo.

You mentioned earlier potentially reviewing the portfolio in Australia. Have you identified assets at this point? Can you size it? What's the timeline and why now?

I think we generally don't comment on obviously forward-looking acquisitions or divestments and I think that's a practice that we’ll stick to, but what we have said in the past is that we are always looking at our asset portfolio. We have been very clear that we're looking to simplify the portfolio and drive profitable growth. And to that end, we obviously will look at any opportunities that come our way in relation to the assets that we have down there.

Next question comes from Craig Huber with Huber Research Partners.

I guess a similar question. What was the circulation revenue for Wall Street Journal Australia and UK with or without turns on a year over year basis? And then separately Susan, if I could ask housekeeping question, you gave a lot of D&A numbers, but is the quarterly D&A number starting here in the June quarter going to be roughly about 170 million where is that going to fall out, is it about 100 last quarter.

Thanks, Craig. I think so in relation to your first question, in relation to the circulation, so in local currency, we are expecting Dow Jones to be up about 12%, Wall Street Journal up about 12%. We’re expecting local currency to be down 5% and these, we're expecting to be relatively stable. In relation -- what was your question in relation to the D&A sorry?

What was the D&A for the upcoming quarter for the whole companies, including Foxtel, is that 170 million or something.

We don't comment on obviously Craig, on the forward looking projections, but obviously as they become clearer, we will communicate those.

What would they ask for March quarter if you had it all already in there Foxtel?

We have that in the prepared comments actually. We read that out. We had D&A for the first nine months totaled 187 million, including 69 million for the quarter and then we also amortized an additional 49 million year to date, or 17 million for the quarter in relation to the CMH acquisition.

Next question comes from Brian Han with Morningstar.

Just out of interest, does Mr. Rupert Murdoch still spend much time thinking and talking about News Corp businesses or do you think he's increasingly more preoccupied with what's going on in Fox.

Well, I can only speak for our experience which is that Rupert is very much engaged in the company, actively so, as Executive Chairman. He is across all the businesses and his level of interest remains intense.

[Operator Instructions] And our next question comes from Raymond Tong with Evans and Partners.

Robin in. Susan, you mentioned that you have passed the 40 million sort of cost out Target this year for News Corp Australia, can you maybe talk about sort of further cost out opportunities in also, you mentioned exploring sort of potentially sharing printing costs with Fairfax, can you maybe just discuss that a little bit please.

So the team in Australia continue to remain focused on how they can drive those efficiencies down and they have been looking right across the business, whether it's back office functions and organizational redesign and there's been some announcements that have come out in the market out there, anyway over the previous couple of months. In relation to the industry solutions, I think as I said globally we’re actively looking at whether they are opportunities from a press side facility as well as the distribution facilities and we will continue to explore those options. Obviously, they need to make sense for both book parties and they can be quite detailed and join our commercial negotiations, but we have had tremendous success with those negotiations over in the UK and we’ve had much success and we have no reason to believe that we can't draw similar conclusions in other markets that we're having a look at. So the team do continue to remain focused on replacing legacy systems, removing antiquated practices and draw I think efficiencies by those means and we believe that there's still opportunities where they can continue to get cost out going forward.

And there are no further phone questions at this time. So I'd like to turn the call back over to Mike Florin for any additional or closing remarks.

Thank you for all participating. Thank you for your help Sophie. Have a great day and we'll talk to you soon.