Time Warner Reports Strong Q4
Cash Flow Rises 35% on Cable Nets, Movie Studio
Mike Farrell -- Multichannel News, 2/3/2010 2:12:11 PM
Time Warner Inc. reported stronger-than-expected, fourth-quarter results, with revenue up 2% to $7.3 billion and adjusted operating income before depreciation and amortization up 35% to $1.5 billion, fueled by gains at its cable networks and filmed entertainment divisions.
Cable networks, which accounted for 60% of the quarterly AOIBDA gain, turned in another strong quarter of growth, with revenue up 4% to $3.1 billion and AOIBDA up 29% to $878 million. Advertising revenue at the segment was down 4% in the period.
At the filmed entertainment division, which includes Warner Bros. Studios, revenue rose 8% to $3.2 billion in the quarter and AOIBDA was up 41% to $524 million, fueled by theatrical releases such as Harry Potter and the Half-Blood Prince, The Blind Side, Sherlock Holmes and The Hangover.
Time Warner chairman and CEO Jeff Bewkes was bullish on the future - he predicted that ad sales would increase in 2010 - and pointed to strong expected performance at its Home Box Office and Turner Networks divisions. Bewkes said on a conference call that while HBO may have been slightly impacted by declines in premium service subscriptions at several cable operators, growth from telco distributors has more than made up the difference.
"I think you've heard more chatter about premium softness than has actually happened," Bewkes said.
And he expects as new enhancements to the premium channel are made available - including HBO Go - cable operators will recharge their efforts to grow subscribers.
"Cable operators are going to refocus their efforts on premium TV categories and putting out these enhancements in order to remain competitive," Bewkes said. "What it all translates to is very strong across the board revenue growth for HBO."
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