Time Warner Gets Back Into The Black - InformationWeek

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Time Warner Gets Back Into The Black

The world's largest media company says 4Q revenue rose 6% to $10.9 billion and it posted a profit of $638 million.

NEW YORK (AP) -- Time Warner Inc., the world's largest media company, returned to profit in the fourth quarter of 2003 after reporting a $44.9 billion loss in the same period a year ago, the company said Wednesday.

Gains in its movie and cable-TV units helped the company post net earnings of $638 million, or 14 cents a share, in the three months ending in December, just shy of the 15 cents per share that analysts surveyed by Thomson First Call had been expecting. Revenues rose 6 percent to $10.9 billion from $10.25 billion in the same period a year earlier.

Last year's loss stemmed from write-downs in the value of the company's AOL unit, which remained a weak spot in the latest report, with revenues declining 7 percent in the quarter. Operating earnings in the division swung back to a profit of $301 million compared with a loss of $33.14 billion a year ago due to the write-off.

Time Warner, whose vast holdings include the Time Inc. magazine family, HBO, CNN, and AOL, has been working to reduce debt and regain the trust of Wall Street following the disastrous decline in its stock price after the merger with AOL, which was announced at the height of the Internet bubble in early 2000.

"Our company exited 2003 substantially stronger than when the year began, and we enter 2004 with a real sense of enthusiasm," CEO Dick Parsons said.

Time Warner said it expects earnings in each of its segments to grow faster in 2004 than last year, except for New Line cinema, which had a blockbuster year in 2003 with the latest "Lord of the Rings" movie.

Excluding the effects of write-downs and other one-time gains and losses, the company's operating income edged lower to $2.39 billion from $2.43 billion in the same quarter a year ago. All segments posted stronger results except AOL and Networks, which includes CNN, HBO, and TNT.

Time Warner excluded results from its music division, Warner Music Group, which it has agreed to sell to an investor group led by Edgar Bronfman Jr., the former head of Seagram Co.

After receiving the $2.6 billion in cash it expects to get from that deal, the company will reach its goal of reducing its overall debt to about $20 billion almost one year ahead of schedule. Time Warner's debt stood at $25.8 billion at the end of 2002.

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