Good day. Welcome to the News Corp first quarter fiscal 2017 earnings call. Today's call is being recorded. Media is allowed to join today's conference in a listen-only basis. At this time, for opening remarks and introductions, I would like to turn the call over to Mr. Mike Florin, Senior Vice President and Head of Investor Relations. Please go ahead, sir.
Thank you very much, Matt. Hello, everyone. Welcome to News Corp's fiscal first quarter 2017 earnings call. We issued our earnings press release about 30 minutes ago, and it's now posted on our website at newscorp.com. On the call today are Robert Thomson, Chief Executive, and Bedi Singh, Chief Financial Officer. We'll open with some prepared remarks. 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 Corporation'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'll pass it over to Robert Thomson for some opening comments.
Thank you, Mike. The most recent quarter has highlighted the continuing digital development at News Corp at a time of great transition for media companies, many of which are struggling to cope with e-evolution. Our growing portfolio of digital products and our global character have enabled us not only to weather those profound changes, but to build a firm foundation for a profitable future. There is no doubt that two of our core markets, the U.S. and U.K., have been characterized by a certain amount of uncertainty in the economic and political environment. We have remained focused on developing long-term and robust sources of revenue while curtailing costs without undermining the quality of our uniquely valuable content. Collaboration among our businesses has increased with the sharing of lessons, software, and data to provide more valuable insights for our clients, readers, and advertisers.
During the first quarter of financial year 2017, despite a distinctly soft print advertising market and patent weakness in the British pound, our revenues were down only slightly. It is thus clear that our emphasis on digital real estate has given the company more resilience in even difficult trading periods. We are still at the early stages of that real estate development, particularly in the U.S., where we are renovating realtor.com whilst living in the house. We expect that rates of growth at realtor.com will increase later in the year as new products and pricing take hold in a U.S. property market that is itself still recovering from the extreme dislocation of the financial crisis. For the most recent quarter, total segment EBITDA declined 21% versus the prior year.
Half of that decrease was due to planned investments and one-time transaction costs, and we do not expect the quarterly performance to be reflective of the full-year results. In fact, we expect to see EBITDA improvements in the remainder of the year, largely driven by growth in digital real estate and at HarperCollins. As our real estate business continues to evolve and expand, we are now highlighting listing-based revenues separately in the digital real estate services segment to better reflect our performance and provide a clearer indication of the trajectory in that increasingly important sector. Significantly, this highlights our reduced reliance on traditional advertising, which today accounts for only a third of our total revenues.
In addition to the strength of digital real estate, we are also pleased with the trends in book publishing and at News America Marketing, which showed continuing growth in its in-store product revenue and is ahead of schedule in achieving its year-end goal of 10 million downloads of the Checkout 51 app, which provides incentives for shoppers and unique marketing opportunities for consumer goods producers and retailers. As mentioned, one of the more profound changes at News Corp since its reincarnation in 2013 is the burgeoning of the digital real estate business, building on our early success with REA in Australia and complementing that with investments in the U.S., East Asia, and India. REA performed well again in the quarter, despite some weakness in listing volume. Pricing improved and services provided to agents were enhanced. Revenues expanded by 16% in local currency, including sales of the recently acquired iProperty.
REA is the clear market leader in Australia and has proven the robustness of its business by expanding reach and revenue despite macroeconomic fluctuations in Australia. Move, which operates realtor.com, experienced 9% revenue growth in the first quarter as we revamp the site and retool its products. With the rollout of Showcase 2.0 in December and deeper penetration from the recently launched Seller Leads and Turbo products, we are confident revenue momentum will build in coming months. We firmly believe realtor.com will make a meaningful contribution to segment revenue and the EBITDA growth this year. We are investing for the long term, but not at the expense of returns for investors.
According to Comscore, engagement with realtor.com leads the competition by a significant margin. Since our acquisition of Move 2 years ago this month, realtor.com's audience has grown more than 60%, and brand awareness of realtor.com is at 87%, which is up more than 25% in the last 18 months. In book publishing, HarperCollins reported a 14% increase in EBITDA, despite a 5% decline in revenue, which was largely the result of the impact of the comparison with last year's sales of "Go Set a Watchman," the "To Kill a Mockingbird" prequel sequel. The HarperCollins team is increasingly focused on books which resonate beyond the traditional elites, as is evident from the popularity of such titles as J.D. Vance's "Hillbilly Elegy" and Sarah Young's books, including the new "Jesus Always," which builds on the success of her "Jesus Calling" series.
Also performing well are "The Black Widow" by Daniel Silva, "The Magnolia Story" by Joanna and Chip Gaines, and "Commonwealth" by Ann Patchett. The consolidation of our international operations in tandem with the Harlequin acquisition has given us a significantly more powerful global platform. We are also able to use our trade assets to market crossover successes from the Harlequin stable of writers, which is increasing both sales and margins for select titles. In coming weeks, we will see the release of the highly anticipated "Settle for More" by Megyn Kelly. That title, "Settle for More," will be our motto in coming quarters. We also have optimistic expectations for Veronica Roth's next book, "Carve the Mark." Veronica wrote the extremely successful "Divergent" trilogy. For "Chaos" by Patricia Cornwell.
In news and information across our mastheads, we saw a more challenging print advertising marketplace, as has already been articulated by other companies in the sector. Digital advertising increased, that growth was not enough to offset the decline in print. There is no doubt that the advertising market is in upheaval, and that the renewed advertiser focus on viewability and measurability should naturally benefit trusted brands with accurate metrics. Hype and hip are not alternatives to quality and integrity. In the middle of this commercial commotion, it is appropriate that ad agencies are under scrutiny, as too much ad tech is fad tech. Advertising at "The Wall Street Journal" was down 21%, but our circulation revenue rose 6%, and the number of paid digital subscribers at "The Wall Street Journal" crossed the 1 million mark in September.
The transition at the WSJ was highlighted by the fact that digital accounted for a record 55% of revenues this quarter. Obviously, some of that change is due to the decline in print advertising, but it also reflects the emphasis on broadening the digital subscriber base and the long-term strategy of upselling higher-yielding specialist products to those subscribers. Historically, advertising accounted for about half the revenues at Dow Jones, but that ratio is now closer to one-third. Clearly, there is a renewed emphasis on cost control, including a reduction in headcount at Dow Jones and a redesign of the Journal itself. You'll be able to see the results of that redesign in coming weeks, and it will be obvious that print remains a very powerful platform and that the Journal has an audience of unique influence and affluence.
At News Corp Australia, we continue to confront the cost base while broadening our range of digital offerings. We experienced strong digital paid subscriber growth in the first quarter and expanded the number of mastheads with a freemium hybrid model, allowing limited free access along with a paid-for premium subscription. That model builds on the success we have seen at "The Australian." Meanwhile, at news.com.au, Australia's leading news website, advertising revenue rose more than 30% in local currency compared to the same period last year. Sport is a vital part of our offering in Australia, which is why we announced the acquisition of Punters.com.au in October, offering news, analysis, and comparative odds for horse racing and other sports. At the same time, we are keen to dispose of non-core assets to sharpen the focus of our operations.
To that end, we sold our stake in New Zealand Media and Entertainment and hope to complete the sale of CarsGuide and "The Sunday Times" in Perth by the end of fiscal Q2. At News UK, "The Times" continues to gain market share and drive higher volume growth. It experienced a 13% gain in print circulation in the first quarter in a sector that is too often defined by a decline. At "The Sun," while advertising revenues have fallen, the digital audience has expanded dramatically since the paywall was lifted late last year. We are seeking to attract loyal readers with quality content and not digital drive-bys distracted by vacuous, contentious clickbait. In September, there were almost 46 million monthly visitors to "The Sun," compared to 15 million uniques in September 2015 before the lifting of the paywall.
News UK also benefited from cover price increases for its mastheads and from the launch of Sun Bets in August. With the acquisition of Wireless Group, the team at News UK is working on the integration of this valuable asset, leveraging talent across platforms, fashioning new ad packages to take advantage of multimedia opportunities, and cross-promoting our brands, including Sun Bets, which should be a powerful generator of future revenue for the company. Speaking of successful popular titles, digital ad revenue for Q1 grew 42% year-over-year at the "New York Post," where the broader post-digital network had a record 65.1 million unique visitors in September, an increase of 109% year-over-year based on internal metrics. At News America Marketing, in-store products continue to post strong revenue growth driven by the creation of innovative avenues.
Points of purchase persuasion is a powerful asset that we have at News America Marketing, which also has valuable direct links to advertisers who rely on its unique market intelligence. In the past, digital has been a rather modest part of News America Marketing's offering, but the acquisition of Checkout 51 has changed that outlook dramatically. We had targeted the acquisition of 10 million members this calendar year for Checkout 51. That could top that total this month, if not this week. The larger the audience, the better quality the offerings, the stickier the experience. That virtual cycle is clearly in motion at Checkout 51, where we've had an influx of new deals from companies such as Procter & Gamble, Mondelez, and General Mills.
We have just launched a Spanish language version of the app to appeal to the large and growing Latino audience in the U.S., while we are able to gather rich permission data from users that is of supreme value to advertisers wanting an insight into shopping habits. We are looking forward to the integration of PayPal into Checkout 51, expected by December, which will make it even easier for consumers to receive rebates for their purchases. Foxtel posted modest year-over-year growth in cable satellite subscribers, although there was higher churn partially related to promotional, no-contract offers last fiscal year. Foxtel remains keenly focused on improving the quality of experience for subscribers and providing more product focus, hence the decision to unwind the Presto joint venture with Seven West.
The executive team, led by Peter Tonagh, is determined to convey to potential subscribers the clear relative merits of Foxtel Play, whose offering is vastly superior to that of competitors. Foxtel Play streaming service will roll out next month. It will present consumers with greater choice and flexible packages, as well as much easier access to Foxtel's premium content, including Fox Sports, whose viewer numbers have repeatedly set records in recent months. To ensure that subscribers have an unparalleled experience, Foxtel announced this quarter a new agreement with HBO that will give Foxtel even more extensive rights to HBO's library of content through 2021. Despite the focus on product enhancement and infrastructure investment, we were encouraged to see relatively stable EBITDA this quarter. As for Fox Sports, the record ratings were particularly pronounced for NRL, while there were also strong performances by Aussie rules football and motor racing.
NRL viewership was up 11% for all games, and those exclusive to Fox Sports were up 15%. For AFL, total viewership was up 8%, while the preliminary final between the Giants and the Western Bulldogs, the penultimate match of the year, was the number one subscription TV program so far in calendar year 2016 in Australia. That increased viewership, as well as expanding digital advertising, were catalysts for advertising growth of low double digits in local currency in the first quarter, which compares rather favorably to the listless levels elsewhere in the industry. Costs were higher in the first quarter, as was expected, reflecting the timing of sports expenses, about which Bedi Singh will have further details. Thankfully, these quarterly costs are not reflective of the full year exposure. Globally, we continue to integrate our Storyful and Unruly acquisitions into our existing brands.
News UK now brings Storyful and Unruly into joint pitches for digital advertising. Storyful, which has a unique ability to divine meaningful moments on social media, has become a part of the pitch for our Dow Jones risk and compliance business. If the consumer has a problem with a product and uploads a video or a comment, Storyful's unique access to social platforms globally allows it to track the virality of the incident. It also remains the world's leading authenticator of social video for news agencies and broadcasters around the world. In conclusion, News Corp is not just a news company. We are a digital real estate company and a global and information company.
We are proud of our provenance, also leading the way in defining a digital future for media, whether it be through the strength of our mastheads on mobile or the rapid growth of innovative news and commercial apps. That focus on long-term growth is complemented by a rigorous monitoring of costs in the here and now. We are extremely conscious of our responsibility to shareholders to create products that will prosper while ensuring that we are canny custodians of our traditional businesses in transition. Speaking of canny, I now pass you over to our CFO, Bedi Singh.
Thanks, Robert. We reported fiscal 2017 first quarter total revenues of $1.97 billion, down 2% compared to the prior year. Currency had a $36 million unfavorable impact to revenues, with modest year-over-year improvement in the Australian dollar more than offset by continued weakness in the British pound. Total segment EBITDA was $130 million, including $5 million in transaction-related costs for the Wireless Group acquisition, compared to $165 million in the prior year. For the quarter, EPS from continuing operations were negative $0.03 compared to positive $0.22 in the prior year. Adjusted EPS from continuing operations were negative $0.01 versus positive $0.05 in the prior year. Before discussing segment performance, as Robert noted, listing-based revenues from our digital real estate businesses are now captured in a new real estate line on our income statement to better highlight that growth. Prior to this change, those revenues were reflected within advertising revenues.
We have also adjusted prior year comparatives for this. This real estate revenue line represented 9% of total revenues this quarter and grew 19% compared to the prior year. Turning to the individual operating segments. In news and information services, revenues for the quarter decreased 5% from the prior year to approximately $1.2 billion. Within segment revenues, advertising, which accounted for just under 50% of revenues, decreased around 11%, or down 10% in local currencies, driven by weaker global print ad trends. Circulation and subscription revenues decreased 4% but were up 1% in local currency, which is relatively stable with last quarter and the prior year, driven by higher paid digital volume and price increases. News and information services segment EBITDA this quarter was $46 million, down from $83 million in the prior period.
This decrease was driven by lower print advertising revenues, combined with $12 million in additional investment spending at Checkout 51 and the $5 million in Wireless Group transaction costs, partially offset by cost savings initiatives. Looking at performance across our key units. At Dow Jones, domestic advertising declined 21% versus the prior year quarter, which is greater than last fiscal fourth quarter rate, reflecting a weaker print marketplace, most notably in the finance and technology categories. On a positive note, Wall Street Journal circulation revenues grew over 6% this quarter due to higher subscription pricing and higher digital paid subscribers, with digital-only subs surpassing the 1 million mark during the quarter, as Robert noted. At the professional information business, revenues were relatively stable. As Robert mentioned, Dow Jones announced a series of initiatives focused on modernizing the newsroom and rationalizing print circulation and pagination while shifting resources to digital.
As part of the plan, we are targeting approximately 8% or $100 million reduction of the cost structure on an annualized basis by the end of fiscal 2018. The restructuring program will begin implementation in Q2 this year and is expected to continue into Q3 with an anticipated restructuring charge of between $50 million-$60 million U.S. pre-tax during fiscal 2017 and benefits starting to phase in over the remainder of the fiscal year. We believe this timely response to the secular print advertising declines will leave the business well-positioned to maximize the digital growth opportunity. At News Australia, advertising revenues for the quarter declined 7%, or approximately 11% in local currency, relatively similar to the last fiscal fourth quarter.
Circulation revenues at News Australia increased modestly for both reported and on a local currency basis as a result of cover price increases and higher paid digital subs offsetting print volume declines. While we continue to benefit from the cost reduction program that News Australia announced in the second half of fiscal 2016, which totaled around 5% of the cost base, we are now embarking on further cost initiatives. We expect an additional AUD 40 million in cost savings this fiscal year while we continue to push digital initiatives more broadly. At News UK, while its reported advertising revenues decreased 28%, ad revenues were down mid-teens in local currency, primarily due to print declines.
Circulation revenues at News UK declined mid-teens versus the prior quarter but were relatively flat in local currency as cover price increases at both The Sun and The Times were offset by single copy volume declines. News UK also benefited this quarter from previously announced cost savings initiatives as well as lower production cost and remains focused on identifying further cost reductions. At News America Marketing, the business overall performed well with revenues relatively flat versus the prior year, driven by mid-teens growth in domestic in-store revenues. Domestic FSI revenue was down mid-teens due to lower volume. At Checkout 51, we achieved over nine million members, adding approximately three million this quarter and well on pace to achieve 10 million by the end of this calendar year, which as Robert mentioned, is a key initiative to accelerating the digital transition at News America Marketing.
Turning to the book publishing segment, revenues decreased 5%, but segment EBITDA improved 14% versus the prior year, which included the release of "Go Set a Watchman" that had accounted for $32 million in revenues in the prior year quarter. EBITDA margins improved to 12.3% from 10.3% in the prior year, driven by the mix of titles. This quarter benefited from a strong new release slate, including "The Black Widow" by Daniel Silva, "Hillbilly Elegy" by J.D. Vance, and Sarah Young's "Jesus Always." Total digital revenues were approximately 20% of consumer revenues, similar to the prior year. In digital real estate services, total segment revenues increased $35 million or 18%, $236 million. Segment EBITDA was $67 million, up from $57 million in the prior year.
REA Group's revenues grew 22% or approximately 16% in local currency due to an increase in Australian residential depth revenue benefiting from favorable product mix, combined with modest revenue contribution from iProperty. Results were partially offset by softer listing volumes in Australia, declining approximately 8% versus the prior year. REA Group reported their fiscal first quarter earnings today and just concluded their conference call, which provided more quarterly detail. Move, Inc. revenues rose 9% to $93 million versus the prior year, reflecting continued strong performance from CoBroke after more than doubling in Q1 fiscal 2016, as well as growth in software services revenue, albeit at a slower rate. The Move, Inc. team is focused on the next generation Showcase product, which we expect to roll out later this quarter, and further penetration of recently launched new products, including Turbo and Seller Leads.
We expect revenue growth to accelerate in the second half of the year and are on track to deliver increasing positive contributions to segment EBITDA this fiscal year. Average monthly unique user growth at realtor.com remains strong, up 15% year-over-year to 53 million in the quarter. In cable network programming, revenues increased by 3% compared to the prior year quarter, primarily due to advertising growing mid-teens, benefiting from higher ratings across the board as well as higher contributions from digital advertising. Segment EBITDA in the quarter was $14 million, which was $14 million lower than the prior year quarter due to, as expected, costs related to the simulcast of additional NRL matches from Channel Nine and the airing of the Sri Lanka Australia cricket tour, partially offset by the absence of the EPL rights cost.
We do expect EBITDA to improve in Q2 due to the absence of costs from the English Premier League and Rugby World Cup, which we had in the prior year. With respect to earnings from affiliates, Foxtel ended the quarter with approximately 2.9 million total subscribers, with closing cable and satellite subscribers increasing approximately 1% compared to the prior year period. Last month, Foxtel announced that it had bought out Seven West Media's shares in the Presto joint venture, and the Presto service will be subsequently closed, and Foxtel will shift its IP efforts to Foxtel Play. Existing Presto customers will be invited to move to the new Foxtel Play, and Presto will cease operations on January 31st, 2017. Foxtel recorded an AUD 21 million loss as a result of the decision to cease Presto operations, and our equity income was AUD 11 million lower, principally as a result of this.
Foxtel revenues for the quarter increased 5% and were up 1% in local currency, and EBITDA increased 2% but was down 2% in local currency due to higher programming costs and marketing. Churn, as expected, remained above prior year at 15.5% as we cycled through some historical no-contract offers. Importantly, underlying year-on-year churn data, when adjusting for the impact of new customer offers, has been more stable. ARPU for the quarter was down approximately 3% to around AUD 88. Capital expenditures from continuing operations for the quarter were $49 million, lower than $63 million in the prior year. Turning to the balance sheet, net cash at September 30th was $1.1 billion, including $377 million of debt related to iProperty. Cash on the balance sheet is down from fourth quarter 2016, principally reflecting the payout of the News America Marketing settlement of around $250 million.
In summary, while the quarter faced some obvious challenges, as we have noted, we expect to see improvements for the remainder of the year versus the prior year. A few points to highlight. While print advertising trends remain very volatile and visibility continues to be limited, we have stepped up our cost savings initiatives, particularly at Dow Jones, and expect improved EBITDA performance in the current quarter and the balance of the year. We will also be including the contributions from Wireless Group within the News and Information Services segment from 1st of October. Book publishing should see favorable comparisons, and we look forward to the release of "Settle for More" by Megyn Kelly, "Chaos" by Patricia Cornwell, and "The Magnolia Story" by Chip and Joanna Gaines, as well as carryover sales from "Jesus Always" by Sarah Young, which debuted last quarter.
We have a strong roster of titles this year and expect to see a return to growth in digital, which bode well for the year ahead. FOX SPORTS Australia, as I mentioned, should benefit from lower rights costs in the second quarter and should see an improvement in EBITDA versus the prior year. For the full year, costs should be down modestly in local currency, with no major rights renewals impacting this fiscal year. For Digital Real Estate, we expect continued revenue and EBITDA growth for the segment. While listings volumes in Australia for the second quarter remain lower than the prior year, we expect continued growth benefiting from favorable pricing and increased penetration. Realtor is expected to roll out Showcase 2.0 later this quarter, and the revenue lift is expected to be more second-half weighted, reflecting the timing of contract renewals.
We expect to see a strong improvement in EBITDA contributions from Realtor this year. With that, let me hand it over to the operator for Q&A.
Thank you. If you'd like to ask a question, please signal by pressing *1 on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. We ask that you limit yourselves to one question while in queue. Again, that is *1 for questions. At this time, we will take our first question. This will be from Entcho Raykovski with Deutsche Bank.
Hi, Robert, hi, Bedi. My question's around News and Information Services. You've obviously spoken about digital advertising revenues offsetting some of the print declines. Can you give us an idea of some of the quantum of growth within digital ad revenues and also any breakdown you could give us by jurisdiction as well as what sort of trends you've seen within digital ad revenue growth would be appreciated. Thank you.
Entcho, thanks very much for the question. As for the future itself, unfortunately, I don't have sibylline power, so it's difficult to define. At Dow Jones, we are seeing some improvement in October, beyond that, I don't have the confidence to give you a forecast. Just more broadly before we get into the granular details, what we are seeing at the moment is some mayhem in the ad market. Advertisers are having ads placed on sites that seem almost to have contempt for for-profit companies, or they have their products bobbing around in bilge water. That ad apostasy simply can't continue ad infinitum. At heart, we're very confident about our quality content, our quality audiences, and the quality canvas we have for advertisers. At News Corp Australia, we saw advertising down about 11%, excluding FX in the quarter. News UK advertising in total was down mid-teens.
Print was down high teens, digital up low teens. At Dow Jones, advertising was down 21%. We have experienced double-digit growth for digital at News UK and News Corp Australia. We're emphasizing the quality of our data and our quality of permission data, that is, and our audiences. We're building out more segmented products for advertisers so that we will be able to target those quality audiences in a meaningful way. I think what we're talking about is a longer-term strategy, but one that should have results in the short term.
Thanks, Entcho. Operator, we'll take our next question.
Thank you. We will move along to Craig Huber with Huber Research Partners.
Yes, hi. A question on The Wall Street Journal. Just what is your thoughts on why the declines have accelerated negative 21% at the print Wall Street Journal this last quarter, and what is your outlook there for the upcoming quarter?
Well, I said, I think there is a broader issue about advertising generally. There is definitely mayhem in the market. I think some advertising is driven more by trend than by substance. When you have that amount of volatility in the broader market, you are going to have, for certain mastheads in certain quarters, a fair amount of volatility. That was certainly the case at the Journal. Tech advertising was down to a certain degree, finance also. On the other hand, in the WSJ. Magazine, we had a record issue in September. It is not as though advertisers have abandoned print as a sector, and print is a very powerful platform. It is that there is a lot of content out there. Frankly, a significant amount of that content is less meritorious and more meretricious.
The only thing I would add, Craig, is that advertising is pretty much week by week. What we are seeing, though, is that when we look at October, there is some tempering of this rate of decline that we saw in the first quarter. Whether that continues for the rest of the quarter, it is difficult to say. Certainly at The Wall Street Journal and at News Australia and at News UK, we are seeing some tempering of the declines. I think visibility is limited, but at least we are seeing things improve a little bit.
Thanks, Craig.
Thank you.
Operator, we'll take our next question, please.
We'll now move to Brian Han with Morningstar.
Oh, hi, Robert. Just one question. You've had a $500 million buyback program in place for a while now. Yet you've only bought back a fraction of that to date. Just wondering how the board thinks about all this, especially during times when the stock price is depressed.
Well, we do have a $500 million provision. We have bought back a modest amount of stock. Clearly, when we think in terms of capital allocation, it's a broad-based strategy, which includes internal investment. It certainly includes returns to investors. We have also a modest dividend in place. It has to be based on an understanding of the long-term value of the company. That is what guides all of our decisions and the board's decisions about the buying back of stock. Thus far, we've bought back $71 million. Any further moves will be in the context of that broader strategy.
Okay, operator, we'll take our next question, please.
Okay. Again, that was star one for questions. We'll move to [Peter Stimolous] with Evans & Partners.
Yes. Hi, good morning. I was hoping you could provide some color around the free cash flow operations for the business, obviously down $300 million for the quarter, what the expectations are going forward. I suppose, can we track EBITDA and what can we expect around conversion of free cash flow? Thank you.
Hi, Peter. Free cash flow, obviously we reported negative for this quarter. As I mentioned, it's mainly driven by the fact that we had a payment to make for settling the News America Marketing litigation, which was $250 million. We'd accrued for that last year, now we paid it out this quarter. We also had slightly higher working capital this quarter. Some of it was due to the acquisitions around iProperty. Obviously we had lower EBITDA. All of those factors contributed to that. You shouldn't take the first quarter as being indicative for the rest of the year. We're very focused on generating healthy, positive free cash flow. I would say mainly it's all timing things this quarter. Without giving a specific number, though, I think we are striving to make sure that we are very healthy for the remainder of the year.
Thanks, Peter. Operator, we'll take our next question.
At this time, we have no questions in the queue, I'd like to remind everyone again that it is star one to queue up. We'll take a follow-up question from Craig Huber with Huber Research Partners.
Yes. Hi. I'd be curious to hear what the margins were like at move.com versus a year ago. How were the profits there?
We don't give out specific margin information as you know, Craig. We have started giving out, obviously, revenue information based on your last request. I would say that margins are growing, and if you exclude stock-based compensation, EBITDA was higher than we've had before. It's ramping up, is what I would say. We're not giving a specific number, but we're on track to be very meaningfully profitable from next quarter onwards.
Thanks, Craig.
Thank you.
Operator, are there any other questions?
We have a follow-up question from Brian Han with Morningstar.
Thanks, gentlemen. Just one more. In your other division, I appreciate, Robert, that you want to continue to canvas new businesses to invest in, the $180 million cost in the other division still seems quite substantial. Do you think there's any room to reduce that cost base?
We're continually striving to reduce the, as you call, the other, which is principally our sort of corporate and overhead costs. It's come down a lot since we started showing our results two, three years ago. We've been constantly bringing that down, and I think you'd expect to see some improvement on that as we go forward. U.K. newspaper matters, which are included in that, are obviously coming down, as we've reported.
Okay. Operator, are there any other questions?
Yes. We'll take a follow-up from Entcho Raykovski with Deutsche Bank.
Hi. Just a follow-up from me around the new agreement with HBO, which you mentioned that Foxtel has entered into. Could you give us any more indication of the terms of that agreement and the sort of uplifting costs which it resulted in? I mean, I appreciate you might not give us the exact numbers, but how significant that uplift may have been?
Entcho, your instinct is correct. We're not going to give you the exact numbers. Look, I think the key word at Foxtel is focus. The rights you're talking about are exclusive to subscription TV. As you know, we have taken the decision to close down Presto. Frankly, we thought that was a distraction from the core brand and core proposition, which has by far the best suite of programs in Australia, as I'm sure you well know from your personal experience. Okay. Thank you. Operator, we'll take our next question, please.
Okay, we have one more question in the queue. This will be from Eric Katz with Wells Fargo.
Hi, good afternoon. You mentioned looking through the balance of the year, several segments talking about improvements, particularly in EBITDA. I was wondering if you can give a little bit more color on that because it sounds overall that you expect improvements, but I don't know if that means, for instance, News EBITDA would be higher or growth rates would be better. Any particular quarters or back half of the year that you'd point out in any particular segment?
Eric, look, I'll start. Bedi will no doubt complement my comments. In digital real estate, as Bedi's indicated, we expect momentum as the year unfolds with new products and new pricing, and it will be strongly EBITDA positive. That is certainly a growing business. At HarperCollins, you need only to look at the bestseller list at the moment to get a sense of the impact of our titles. We're very pleased with the focus on books like "The Magnolia Story," like "Sully," no doubt like Megyn Kelly's "Settle for More," that will have broad impact on society and a positive impact on our accounts.
We think Fox News, as we get into the spring selling season in Australia for sports, given the record audiences of last year and the buzz around both Rugby League and Aussie Rules next year, that that will be efficacious also.
Great.
Thank you, Eric. Well, thank you all for participating. Have a great day, and we'll talk to you soon.
Once again, this does conclude today's conference call. Thank you all for your participation.