Time Warner Q2 Profit Tops View

(RTTNews) - Media and entertainment giant Time Warner, Inc. (TWX), which recently rejected a bid from 21st Century Fox (FOXA, FOX), Wednesday said profit for the second quarter increased from the prior year and topped estimates, amid a modest growth in revenues. The firm backed its full year earnings forecast.

Chairman and Chief Executive Officer Jeff Bewkes said, "We had another strong quarter, reflecting the strength of our businesses and our potential for continued growth as we deliver on our strategic plan to be the world's leading video content company."

Net income attributable to the company increased to $850 million from $771 million last year. Earnings per share rose to $0.95 from $0.81. Prior-year results have been restated.

Adjusted Income per Common Share from Continuing Operations was $0.98 compared to $0.76 for the year-ago quarter. On average, 27 analysts polled by Thomson Reuters expected the company to earn $0.84 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues increased to $6.788 billion from $6.608 billion due to growth at Home Box Office and Turner. Analysts estimated revenues of $6.87 billion for the quarter.

In Turner, revenues rose 5 percent to $2.8 billion, mainly due to growth of 8 percent in Subscription revenues and 1 percent improvement in Advertising revenues.

Home Box Office or HBO, increased revenues by 17 percent to $1.4 billion, reflecting 10 percent growth in Subscription revenues and 56 percent surge in Content revenues.

In Warner Bros., revenue slipped 2 percent to $2.9 billion, mainly due to softer theatrical performance compared to last year that included Man of Steel, The Hangover Part III and The Great Gatsby.

Separately, the company reaffirmed its 2014 full-year business outlook. The company continues to expect its 2014 full-year percentage growth rate in adjusted income per common share from continuing operations to be in the low teens off a 2013 Adjusted earnings per share from continuing operations base of $3.51. Wall Street expects earnings of $3.99 per share for the year.

The firm also said its Board of Directors declared a regular quarterly cash dividend of $0.3175 per share of common stock, payable in cash on September 15 to stockholders of record on August 31.

Tuesday, 21st Century Fox withdrew its proposal to acquire Time Warner, citing Time Warner's refusal to engage in talks, and the reaction in 21st Century Fox's share price in response to the offer.

Meanwhile, Time Warner said its Board and management team are committed to enhancing long-term value and look forward to continuing to deliver substantial and sustainable returns for all stockholders.

TWX, which closed down 0.4 percent at $85.19 on Tuesday, fell 10 percent in pre-market activity.