Twenty-First Century Fox Inc. (NASDAQ:FOX)

The analysis of the financial metrics over the six-year period reveals several notable trends and fluctuations. The net operating profit after taxes (NOPAT) exhibits significant variability without a clear upward or downward trend, indicating inconsistent operational profitability during the timeframe.

Net Operating Profit After Taxes (NOPAT)

Initially, NOPAT stood at a relatively high level but experienced a sharp decline in the following year. It rebounded notably in the third year, before decreasing again and showing minor increases in the final years. This pattern suggests volatility in core profitability, possibly due to market or operational factors.

Cost of Capital

The cost of capital declined steadily from 2013 through 2016, suggesting improving capital efficiency or lower risk perceptions. However, an uptick was observed towards the end of the period, elevating the cost above earlier years, which may impact future investment and financing decisions.

Invested Capital

Invested capital showed fluctuations with initial growth followed by a decrease, and then a recovery towards the end of the period. This pattern indicates adjustments in capital deployment that could reflect strategic initiatives or changes in asset base.

Economic Profit

Economic profit experienced substantial swings, alternating between positive and negative values. Positive economic profit in the early and middle years was followed by negative values in the later years, suggesting that the company’s investments were not consistently generating returns above their cost of capital. The persistent negative economic profit in the latter years signals value erosion during that span.

Overall, the data highlights a period marked by operational and financial volatility. Despite some intervals of improved profitability and capital efficiency, the recurring negative economic profit raises concerns about the sustainability of value creation. The rising cost of capital in recent years further intensifies the challenge of achieving satisfactory returns on invested capital.

Net Income Attributable to Stockholders

The net income showed notable fluctuations over the analyzed periods. It started at 7,097 million USD in 2013, then declined significantly to 4,514 million USD in 2014. In 2015, there was a strong rebound with net income increasing to 8,306 million USD, marking the highest value in the timeframe. Afterward, net income dropped sharply to 2,755 million USD in 2016 and remained relatively low in 2017, with a slight increase to 2,952 million USD. In 2018, net income rose again to 4,464 million USD, indicating partial recovery but still below the earlier peak.

Net Operating Profit After Taxes (NOPAT)

The net operating profit after taxes demonstrated a pattern similar to net income but with somewhat less pronounced variation. Starting at 7,896 million USD in 2013, it decreased substantially to 4,517 million USD in 2014. NOPAT peaked at 9,417 million USD in 2015, exceeding the initial period's value. Following this peak, it declined sharply to 4,025 million USD in 2016. The next two years showed moderate growth, with NOPAT increasing to 4,273 million USD in 2017 and 4,669 million USD in 2018.

Overall Trend Analysis

Both net income and NOPAT experienced significant volatility throughout the six years. The years 2014 and 2016 are characterized by marked downturns in profitability metrics. The year 2015 stands out as a peak period for both measures, reflecting a temporary strong financial performance. After 2016, there is evidence of gradual operational improvement through 2018, though neither net income nor NOPAT returned to their earlier peak levels by the end of the period. The data suggests a cycle of recovery following considerable profit contractions, warranting further examination of underlying causes during downturn years.

Provision for income taxes from continuing operations

The provision for income taxes generally declined from 2013 to 2016, starting at 1,690 million US dollars in 2013 and decreasing steadily to 1,130 million in 2016. In 2017, there was a notable increase to 1,419 million, followed by a significant drop to a negative figure of -364 million in 2018, which may indicate a tax benefit or a reversal of previous tax provisions.

Cash operating taxes

Cash operating taxes fluctuated over the period. Beginning at 1,612 million US dollars in 2013, the figure increased to 1,707 million in 2014, then decreased to 1,504 million in 2015. A more marked decline occurred in 2016 with taxes dropping to 1,095 million. Subsequently, there was a sharp rise to 1,781 million in 2017 before falling significantly to 904 million in 2018. The fluctuations suggest variability in cash tax payments potentially linked to changing profitability or tax planning strategies.

Total reported debt & leases

The total reported debt and leases displayed fluctuations over the six-year period. Starting at $19,912 million in 2013, the debt increased to a peak of $22,748 million in 2014. Following this peak, there was a general decline in debt, descending to $20,609 million in 2015 and remaining relatively stable through 2016 and 2017, with slight increases and decreases respectively. By 2018, the debt had further decreased to $21,076 million. Overall, the debt levels demonstrate initial growth followed by a slight reduction and stabilization trend.

Total Twenty-First Century Fox, Inc. stockholders’ equity

Stockholders' equity showed an overall increasing trend despite some variability. Beginning at $16,998 million in 2013, there was a moderate increase to $17,418 million in 2014, followed by a small decrease to $17,220 million in 2015. A notable decline occurred in 2016, when equity dropped sharply to $13,661 million. After this decline, equity rebounded, increasing to $15,722 million in 2017 and further to $19,564 million in 2018, marking the highest equity value in the period.

Invested capital

Invested capital demonstrated a fluctuating but generally downward trend in the earlier years, followed by recovery in later years. It began at $44,434 million in 2013, increased to $48,265 million in 2014, then decreased significantly to $44,315 million in 2015 and further declined to $42,462 million in 2016. From 2016 onwards, invested capital increased, reaching $45,055 million in 2017 and $47,272 million in 2018, though it did not quite return to the previous peak observed in 2014.

The financial data reveals notable fluctuations in the economic profit of the company over the six-year period ending June 30, 2018. Initially, economic profit was positive at 1603 million US dollars in 2013, followed by a substantial decline to a negative 2199 million US dollars in 2014. Subsequently, there was a significant recovery in 2015, with economic profit increasing sharply to 3416 million US dollars, the highest recorded in the period. However, from 2016 onward, economic profit returned to negative values, ranging from -1356 million to -2104 million US dollars, indicating a sustained period of economic losses.

Invested capital exhibited a generally stable trend with moderate fluctuations. Starting at 44434 million US dollars in 2013, it increased to 48265 million in 2014, followed by a decline to 44315 million in 2015. From 2016 to 2018, invested capital showed a modest upward trend, reaching 47272 million by 2018. This suggests a somewhat consistent scale of investment activity with minor contractions and expansions throughout the timeline.

The economic spread ratio mirrored the pattern seen in economic profit. It began positively at 3.61% in 2013 but dropped to -4.56% in 2014. A strong rebound occurred in 2015 with a peak of 7.71%, indicating a favorable spread between returns and cost of capital during that year. Nevertheless, the ratio turned negative again from 2016 through 2018, fluctuating between -3.19% and -4.45%, reflecting diminished economic value creation in those years.

Overall, the data indicates a volatile economic performance characterized by significant swings in economic profit and spread ratio, despite relatively stable invested capital. The peak year of 2015 stands out as an exceptional period of economic profitability, while the adjacent years predominantly reflect negative economic results, potentially pointing to challenges in sustaining value creation over this timeframe.

The financial data reflects fluctuations in key performance indicators over a six-year period.

Economic Profit

The economic profit exhibited significant volatility. After achieving a positive value of 1,603 million USD in 2013, it shifted to a negative figure of -2,199 million USD in 2014, indicating a substantial decline. The metric rebounded strongly in 2015 to 3,416 million USD, marking the highest point within the period. However, the subsequent years from 2016 through 2018 showed negative economic profits again, ranging between -1,356 million USD and -2,104 million USD, suggesting persistent challenges impacting profitability.

Adjusted Revenues

Adjusted revenues showed moderate growth overall. Starting at 27,472 million USD in 2013, revenues increased to 31,880 million USD in 2014, although there was a decrease in 2015 and 2016 to 28,745 million USD and 27,383 million USD, respectively. Revenues then rose steadily during 2017 and 2018, reaching 28,575 million USD and 30,498 million USD, respectively. This pattern indicates a recovery and expansion in revenue streams after a temporary decline.

Economic Profit Margin

The economic profit margin closely followed the trend observed in economic profit. Starting at a positive 5.83% in 2013, it dropped sharply to -6.9% in 2014. A notable improvement occurred in 2015 when the margin climbed to 11.88%, the peak value in the series. In the last three years, margins turned negative again, fluctuating between -4.95% and -6.9%. The negative margins in recent years suggest profitability pressures despite revenue growth.

Overall, the data reveals periods of strong profitability interrupted by intervals of losses. Revenue growth does not appear to have consistently translated into positive economic profit, highlighting potential issues such as rising costs or other financial challenges affecting the company’s ability to generate economic returns.