News Corporation, the global media company owned by Rupert Murdoch, yesterday counted the cost of higher newsprint prices, the sale of its educational publishing division and the ending of the Net Book Agreement by announcing a 25 per cent drop in net profits to 1.02 billion Australian dollars (£500 million).

But the company's decision to raise prices in its British stable of newspapers helped boost to £153 million half year operating profits at News International, Mr Murdoch's British subsidiary.