British pay-TV giant BSkyB offered its shareholders over 1.0 billion pounds in payouts Friday as it moves on from a failed takeover bid and phone-hacking scandal involving Rupert Murdoch's News Corp.

After posting bumper underlying annual profits, BSkyB said it planned a share buyback of 750 million pounds ($1.22 billion, 857 million euros) and dividend of 253 million pounds -- moves seen as calming the waters after a recent share price collapse.

News Corp., which owns 39.1 percent of BSkyB, will earn nearly 400 million pounds from the payouts, with the US-based media empire announcing that it planned to sell shares back to the broadcaster to keep the level of its stake.

BSkyB confirmed that Murdoch's son James would remain its chairman despite a phone-hacking row at the satellite broadcaster's main shareholder News Corp., which caused the breakdown of its bid for all of BSkyB earlier this month.

The crisis had sparked calls for James Murdoch to resign the chairmanship of BSkyB, but the company's board has given him its unanimous support.

"Following the withdrawal of the News Corporation proposal, the board will return to normal processes. James Murdoch remains chairman," BSkyB said in its annual results statement.

BSkyB, whose portfolio includes the rolling Sky News channel, said its operating profits soared to 1.073 billion pounds in the year to June 30, in line with market forecasts and compared with 872 million pounds in its previous financial year.

Net profit fell nearly eight percent to 810 million pounds.

BSkyB's shares closed down 0.56 percent at 712 pence on London's FTSE 100 index after initially rallying on the earnings news.

The company's stock had slumped from 850 pence to below News Corp.'s bid-offer of 700 pence a share in one week prior to the takeover deal's collapse, knocking 2.5 billion pounds off the firm's value.

BSkyB, which broadcasts live English Premier League football and blockbuster movies, said Friday it had increased its household subscribers to 10.3 million, a proportion of whom pay monthly fees for Internet and telephone services.

"This has been a year of outstanding operational and financial results," James Murdoch said in the earnings statement.

"We are pleased to announce both a 20 percent increase in the ordinary dividend and our intention to return 750 million pounds to shareholders through a share buy-back programme."

BSkyB also announced it would share with state broadcaster the BBC live television rights for Formula One from 2012 to 2018, in a move that means Britons will see only half of each season's races for free.

News Corp. had in June 2010 bid 7.8 billion pounds for the 60.9 percent of BSkyB it did not already own. BSkyB rejected the 700-pence-per-share offer, while the bid was in any case withdrawn over the phone-hacking scandal.

"The clear message from the company is one of confidence for future prospects, with a 1 billion pounds statement in the form of a buyback and hike in the dividend," said Richard Hunter, head of UK Equities at Hargreaves Lansdown Stockbrokers.

"In the medium term, the shares are unlikely to regain the heady heights of 850p after News Corp's withdrawal.. and there could conceivably be some pressure to maintain the growth trajectory given the current (poor) economic backdrop."

It emerged earlier this month that the News of the World, News Corp.'s market-leading British Sunday tabloid newspaper, had hacked the voicemail messages of murdered 13-year-old schoolgirl Milly Dowler.

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