Nov. 3 (Bloomberg) -- News Corp., the media company controlled by Rupert Murdoch, said fiscal first-quarter profit rose 27 percent, in part because advertising sales increased at its cable- television networks such as Fox News Channel.

Net income rose to $536 million, or 32 cents a share, from $422 million, or 29 cents, a year earlier, the company said in a statement. Sales in the quarter ended Sept. 30 increased 12 percent to $5.19 billion. The results matched the average estimate of nine analysts surveyed by Thomson Financial.

Murdoch is boosting ad prices at the cable unit with political talk shows such as "The O'Reilly Factor" and coverage of the U.S. election on Fox News, said David Joyce, an analyst at JB Hanauer in Miami. The network is attracting viewers from competitors such as Time Warner Inc.'s CNN and General Electric Co. and Microsoft Corp.'s MSNBC, he said.

"Fox News Channel's viewership has been phenomenal," Joyce said. "The advertising rates they're receiving have not caught up yet, but that's catching up and that's giving them some great growth right now."

Operating profit at the cable unit jumped 47 percent to $196 million from $133 million because of improved ad sales at Fox News Channel and FX, the statement said. The unit also benefited from higher affiliate fees paid to sports channels, the statement said. Operating profit excludes interest and taxes.

Film Studio

At News Corp.'s filmed entertainment unit, operating profit fell 13 percent to $285 million from $328 million, in part because of marketing costs, the company said. The 20th Century Fox studio released films including "I, Robot" and "Alien vs. Predator" during the quarter.

Operating profit at the broadcast television business rose 30 percent to $233 million from $179 million on higher ad prices and lower costs for prime-time programs, the company said. The unit also was helped by higher operating profit at the Star television unit, where increased ad sales in India and China helped boost revenue 14 percent, the company said.

The loss widened at the satellite-TV unit because of subscriber acquisition costs at Sky Italia, the company's Italian TV business. The loss for the quarter was $121 million, compared with $117 million a year earlier, the company said.

Move to U.S.

News Corp.'s U.S. shares began trading today after an Australian court approved the company's reincorporation in the U.S. state of Delaware. The shares rose 94 cents, or 5.6 percent, to $17.74 at 4:17 p.m. in New York Stock Exchange composite trading. They have declined 1.7 percent this year.

The move to the U.S. allows Murdoch to move his headquarters to New York from Sydney and makes the company eligible to be included in the Standard & Poor's 500 index. That may spur as much as $2 billion in purchases of the stock, Goldman Sachs analyst Anthony Noto wrote yesterday in a note to clients.

News Corp. gets about 75 percent of its sales from U.S.-based businesses such as the 20th Century Fox studio, the Fox broadcast TV network and stations, and the Fox cable networks.

Holders of News Corp.'s American depositary receipts received two common shares for each ADR after the Australian court's ruling, spokesman Andrew Butcher said. The ADRs previously were worth four common shares. Australian shareholders get two shares for each one they hold.

News Corp. owns controlling stakes in El Segundo, California- based DirecTV Group Inc. and London-based British Sky Broadcasting Group Plc, publicly traded companies that report separately. News Corp. owns 34 percent of DirecTV and 35 percent of BSkyB.

News Corp. also holds stakes in satellite-TV businesses in Asia and Australia.

Family Control

Murdoch, 73, and his family own about 30 percent of News Corp., whose other holdings include Fox Entertainment Group Inc. and newspapers such as the New York Post and the Times of London.

Among News Corp.'s biggest competitors, Time Warner, the world's largest media company, said today that its second-quarter profit fell 7.8 percent to $499 because it set aside $500 million for legal costs related to a government investigation of accounting practices at its America Online unit.

Viacom Inc., the third-largest media company, said on Oct. 28 that its quarterly profit rose 12 percent to $722.6 million because of advertising gains at its CBS and MTV television networks. Walt Disney Co., the No. 2 media company, will report earnings on Nov. 19.

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