News Corporation posts significant profits

News Corporation’s phone-hacking scandal has mushroomed into a public-relations nightmare [GALLO/GETTY]

Media giant News Corporation has posted strong profits, reassuring investors that damages caused by the corporation’s highly-publicised phone-hacking scandal may be short lived.

While net income fell 22 per cent to $683m for the fourth quarter, News Corporation finished the year with profits of $2.74bn, a rise of 7.9 per cent compared to 2010.

News Corporation, which owns the Fox TV network and The Wall Street Journal, as well as a range of other newspaper, Internet, broadcast and cable television holdings, is grappling with the biggest crisis in its history.

A phone-hacking scandal in Britain has turned into a full-blown public relations fiasco for 80-year-old chief executive Rupert Murdoch.

“While it has been a good quarter from a financial point of view, our company has faced challenges in recent weeks relating to our London tabloid, News of the World,” Murdoch said in a press release on Wednesday.

“We are acting decisively in the matter and will do whatever is necessary to prevent something like this from ever occurring again.”

Last month Murdoch was grilled by a British parliamentary committee about the scandal. He told the committee that he would not step down as the company’s head.

News Corporation stock rose slightly to $13.80 per share following Wednesday’s announcement.