Record financial performance

Combined with a continued focus on operational efficiency, this strong growth has translated to a record financial performance with adjusted basic earnings per share exceeding 50 pence for the first time. Total revenue increased by 3% as the growth in customers and products more than offset headwinds in advertising and Sky Business. Adjusted operating profit rose by 14% to £1,223 million, the highest level for six years, and we delivered adjusted basic earnings per share of 50.8 pence, up 22% on the prior year.

The Board has proposed a full-year dividend of 25.4 pence per share, an increase of 9% year on year. This represents the eighth consecutive year of growth and is further amplified by our continuing programme to return £750 million to shareholders through a share buy-back. In addition, we intend to seek shareholder approval at the Company's AGM in November 2012 for a further £500 million of share repurchases. As with the current programme, News Corporation has agreed to participate in the buy-back. The effect of that agreement is to provide that there will be no change in News Corporation's economic or voting interests in the Company as a result of the share buy-back programme.

Looking ahead, we remain confident about the long-term opportunity that exists for our business. With around 13 million homes yet to take pay TV and two thirds of Sky customers not yet taking all three of TV, broadband and telephony, there remains considerable headroom for growth in home entertainment and communications.

At the same time, we are in no way complacent about the future. We expect the economic environment to remain challenging for all consumer businesses and the attractive markets in which we operate will continue to be both highly competitive and dynamic. Against that backdrop, we will remain focused on executing our clear and consistent plan. We will continue to deploy capital in areas where customers see value – in getting better on screen and improving our products and services – and maintain an acute focus on operating efficiency to underpin those investments and deliver increasing returns for shareholders.

Responsible journalism

Sky News is the only national television news service that operates without any form of public subsidy or support. We are proud of the contribution it has made to media plurality in the UK and its track record of independent, impartial coverage. At a time of heightened interest in editorial practices across the media sector, and as part of our commitment to acting responsibly throughout our business, we commissioned both an external review of email records at Sky News and an internal audit of payment records. Reporting to the Audit Committee, these reviews found no evidence of impropriety or cause for concern.

Also this year, the Audit Committee reviewed the Company's approach to two separate investigations in which one of its journalists accessed the email of individuals suspected of criminal activity. Following a thorough review, we are satisfied that the action was justified in the public interest and subject to proper editorial oversight.

50.8p

Adjusted basic earnings per share (EPS)

50,000

Young people have taken part in the Sky Sports Living for Sport programme

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