News writes off Sun’s goodwill as phone-hack costs double

Jun 14, 2021 at 10:58 am by admin

Costs from its notorious phone-hacking scandal more than 15 years ago continue to roll on for News Group Newspapers, the UK business unit which used to publish the now-defunct News of the World.

Accounts just filed for the year to June 2020 show costs for what News euphemistically refers to as ‘the newspaper matters’ add more than £52 million (A$95.8 million) to its provision for legal liabilities and charges, almost twice that for the previous year.

A note to the accounts says most of the civil cases brought against the company following “allegations of voicemail interception and inappropriate payments to public officials” have been settled or are in the process of being settled.

“The final costs may or may not be significantly higher than the amounts recognised,” the note says.

With this and a fall in revenue partly due to the loss of a partnership with TabCorp which contributed £39.5 million (A$72.3 million) the previous year, the publisher of The Sun and the Sunday Sun reported a pre-tax loss of £201 million (A$368.1 million) tax loss on turnover of £324 million, which was down nearly £100 million on the previous year.

The value of the company's goodwill – the "carrying value of publishing rights and titles" – has been written down to nil, from £112 million (A$205 million) last year.

With The Sun Online holding its position as the UK’s top digital newsbrand, it spent £12,516 on internal software development. Carrying value of The Sun mastheads has been written down to nil, from £112 million; publication of the News of the World was ceased on July 10, 2011 (pictured).

Both News Group Newspapers and Times Newspapers – which publishes The Times and the Sunday Times – are subsidiaries of NewsCorp subsidiary News UK, a sister company of News Corp Australia.

Sections: Newsmedia industry


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