EVA is registered trademark of Stern Stewart.

Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

Economic Profit
Net Operating Profit after Taxes (NOPAT)
Cash Operating Taxes
Invested Capital
Cost of Capital
Economic Spread
Economic Profit Margin

Twenty-First Century Fox Inc., economic profit calculation

US$ in millions

	12 months ended	Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Net operating profit after taxes (NOPAT)¹
	Cost of capital²
	Invested capital³

	Economic profit⁴

Based on: 10-K (filing date: 2018-08-13), 10-K (filing date: 2017-08-14), 10-K (filing date: 2016-08-11), 10-K (filing date: 2015-08-13), 10-K (filing date: 2014-08-14), 10-K (filing date: 2013-08-19).

2018 Calculations

¹ NOPAT. See Details »

² Cost of capital. See Details »

³ Invested capital. See Details »

⁴ Economic profit = NOPAT – Cost of capital × Invested capital
= hidden – hidden × hidden = hidden

Item	Description	The company
Economic profit	Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital.	Twenty-First Century Fox Inc.’s economic profit declined from 2016 to 2017 and from 2017 to 2018.

Twenty-First Century Fox Inc., NOPAT calculation

US$ in millions

	12 months ended	Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Net income attributable to Twenty-First Century Fox, Inc. stockholders
	Deferred income tax expense (benefit)¹
	Increase (decrease) in allowances for returns and doubtful accounts²
	Increase (decrease) in deferred revenue³
	Increase (decrease) in restructuring program liabilities⁴
	Increase (decrease) in equity equivalents⁵
	Interest expense, net
	Interest expense, operating lease liability⁶
	Adjusted interest expense, net
	Tax benefit of interest expense, net⁷
	Adjusted interest expense, net, after taxes⁸
	(Gain) loss on marketable securities
	Interest income
	Investment income, before taxes
	Tax expense (benefit) of investment income⁹
	Investment income, after taxes¹⁰
	(Income) loss from discontinued operations, net of tax¹¹
	Net income (loss) attributable to noncontrolling interest
	Net operating profit after taxes (NOPAT)

Based on: 10-K (filing date: 2018-08-13), 10-K (filing date: 2017-08-14), 10-K (filing date: 2016-08-11), 10-K (filing date: 2015-08-13), 10-K (filing date: 2014-08-14), 10-K (filing date: 2013-08-19).

2018 Calculations

¹ Elimination of deferred tax expense. See Details »

² Addition of increase (decrease) in allowances for returns and doubtful accounts.

³ Addition of increase (decrease) in deferred revenue.

⁴ Addition of increase (decrease) in restructuring program liabilities.

⁵ Addition of increase (decrease) in equity equivalents to net income attributable to Twenty-First Century Fox, Inc. stockholders.

⁶ Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= hidden × hidden = hidden

⁷ Tax benefit of interest expense, net = Adjusted interest expense, net × Statutory income tax rate
= hidden × 28.00% = hidden

⁸ Addition of after taxes interest expense to net income attributable to Twenty-First Century Fox, Inc. stockholders.

⁹ Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= hidden × 28.00% = hidden

¹⁰ Elimination of after taxes investment income.

¹¹ Elimination of discontinued operations.

Item	Description	The company
NOPAT	Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income.	Twenty-First Century Fox Inc.’s NOPAT increased from 2016 to 2017 and from 2017 to 2018.

Twenty-First Century Fox Inc., cash operating taxes calculation

US$ in millions

	12 months ended	Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Provision for income taxes from continuing operations
	Less: Deferred income tax expense (benefit)
	Add: Tax savings from interest expense, net
	Less: Tax imposed on investment income
	Cash operating taxes

Based on: 10-K (filing date: 2018-08-13), 10-K (filing date: 2017-08-14), 10-K (filing date: 2016-08-11), 10-K (filing date: 2015-08-13), 10-K (filing date: 2014-08-14), 10-K (filing date: 2013-08-19).

Item	Description	The company
Cash operating taxes	Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction.	Twenty-First Century Fox Inc.’s cash operating taxes increased from 2016 to 2017 but then declined significantly from 2017 to 2018.

Twenty-First Century Fox Inc., invested capital calculation (financing approach)

US$ in millions

		Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Current borrowings
	Non-current borrowings
	Operating lease liability¹
	Total reported debt & leases
	Total Twenty-First Century Fox, Inc. stockholders’ equity
	Net deferred tax (assets) liabilities²
	Allowances for returns and doubtful accounts³
	Deferred revenue⁴
	Restructuring program liabilities⁵
	Equity equivalents⁶
	Accumulated other comprehensive (income) loss, net of tax⁷
	Redeemable noncontrolling interests
	Noncontrolling interests
	Adjusted total Twenty-First Century Fox, Inc. stockholders’ equity
	Construction in progress⁸
	Available-for-sale securities⁹
	Invested capital

Based on: 10-K (filing date: 2018-08-13), 10-K (filing date: 2017-08-14), 10-K (filing date: 2016-08-11), 10-K (filing date: 2015-08-13), 10-K (filing date: 2014-08-14), 10-K (filing date: 2013-08-19).

¹ Addition of capitalized operating leases.

² Elimination of deferred taxes from assets and liabilities. See Details »

³ Addition of allowance for doubtful accounts receivable.

⁴ Addition of deferred revenue.

⁵ Addition of restructuring program liabilities.

⁶ Addition of equity equivalents to total Twenty-First Century Fox, Inc. stockholders’ equity.

⁷ Removal of accumulated other comprehensive income.

⁸ Subtraction of construction in progress.

⁹ Subtraction of available-for-sale securities.

Item	Description	The company
Invested capital	Capital is an approximation of the economic book value of all cash invested in going-concern business activities.	Twenty-First Century Fox Inc.’s invested capital increased from 2016 to 2017 and from 2017 to 2018.

Twenty-First Century Fox Inc., cost of capital calculations


Equity²	÷	=	×		=
Borrowings³	÷	=	×	× (1 – 28.00%)	=
Operating lease liability⁴	÷	=	×	× (1 – 28.00%)	=
Total:

Based on: 10-K (filing date: 2018-08-13).

¹ US$ in millions

² Equity. See Details »

³ Borrowings. See Details »

⁴ Operating lease liability. See Details »


Equity²	÷	=	×		=
Borrowings³	÷	=	×	× (1 – 35.00%)	=
Operating lease liability⁴	÷	=	×	× (1 – 35.00%)	=
Total:

Based on: 10-K (filing date: 2017-08-14).

¹ US$ in millions

² Equity. See Details »

³ Borrowings. See Details »

⁴ Operating lease liability. See Details »


Equity²	÷	=	×		=
Borrowings³	÷	=	×	× (1 – 35.00%)	=
Operating lease liability⁴	÷	=	×	× (1 – 35.00%)	=
Total:

Based on: 10-K (filing date: 2016-08-11).

¹ US$ in millions

² Equity. See Details »

³ Borrowings. See Details »

⁴ Operating lease liability. See Details »


Equity²	÷	=	×		=
Borrowings³	÷	=	×	× (1 – 35.00%)	=
Operating lease liability⁴	÷	=	×	× (1 – 35.00%)	=
Total:

Based on: 10-K (filing date: 2015-08-13).

¹ US$ in millions

² Equity. See Details »

³ Borrowings. See Details »

⁴ Operating lease liability. See Details »


Equity²	÷	=	×		=
Borrowings³	÷	=	×	× (1 – 35.00%)	=
Operating lease liability⁴	÷	=	×	× (1 – 35.00%)	=
Total:

Based on: 10-K (filing date: 2014-08-14).

¹ US$ in millions

² Equity. See Details »

³ Borrowings. See Details »

⁴ Operating lease liability. See Details »


Equity²	÷	=	×		=
Borrowings³	÷	=	×	× (1 – 35.00%)	=
Operating lease liability⁴	÷	=	×	× (1 – 35.00%)	=
Total:

Based on: 10-K (filing date: 2013-08-19).

¹ US$ in millions

² Equity. See Details »

³ Borrowings. See Details »

⁴ Operating lease liability. See Details »

Twenty-First Century Fox Inc., economic spread calculation

		Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Selected Financial Data (US$ in millions)
	Economic profit¹
	Invested capital²
	Ratio
	Economic spread³

Based on: 10-K (filing date: 2018-08-13), 10-K (filing date: 2017-08-14), 10-K (filing date: 2016-08-11), 10-K (filing date: 2015-08-13), 10-K (filing date: 2014-08-14), 10-K (filing date: 2013-08-19).

2018 Calculations

¹ Economic profit. See Details »

² Invested capital. See Details »

³ Economic spread = 100 × Economic profit ÷ Invested capital
= 100 × hidden ÷ hidden = hidden

Ratio	Description	The company
Economic spread	The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital.	Twenty-First Century Fox Inc.’s economic spread deteriorated from 2016 to 2017 and from 2017 to 2018.

Twenty-First Century Fox Inc., economic profit margin calculation

		Jun 30, 2018	Jun 30, 2017	Jun 30, 2016	Jun 30, 2015	Jun 30, 2014	Jun 30, 2013
	Selected Financial Data (US$ in millions)
	Economic profit¹
	Revenues
	Add: Increase (decrease) in deferred revenue
	Adjusted revenues
	Ratio
	Economic profit margin²

Based on: 10-K (filing date: 2018-08-13), 10-K (filing date: 2017-08-14), 10-K (filing date: 2016-08-11), 10-K (filing date: 2015-08-13), 10-K (filing date: 2014-08-14), 10-K (filing date: 2013-08-19).

2018 Calculations

¹ Economic profit. See Details »

² Economic profit margin = 100 × Economic profit ÷ Adjusted revenues
= 100 × hidden ÷ hidden = hidden

Ratio	Description	The company
Economic profit margin	The ratio of economic profit to sales. It is the company’s profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin.	Twenty-First Century Fox Inc.’s economic profit margin deteriorated from 2016 to 2017 and from 2017 to 2018.

	Twenty-First Century Fox Inc.	Other companies (not purchased previously)
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Long-term Trends
Analysis
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Financial Statements
Common-Size Financial Statements
Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
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Long-term Trends
Analysis
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Twenty-First Century Fox Inc. (FOXA)

Economic Value Added (EVA)

Economic Profit

Net Operating Profit after Taxes (NOPAT)

Cash Operating Taxes

Invested Capital

Cost of Capital

Jun 30, 2018

Jun 30, 2017

Jun 30, 2016

Jun 30, 2015

Jun 30, 2014

Jun 30, 2013

Economic Spread

Economic Profit Margin