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Time Warner Q3 revenue up 9% to $7.2 billion
MUMBAI: Media conglomerate Time Warner has reported financial results for its third quarter ended 30 September 2016.
Revenues grew by nine per cent to $7.2 billion, Operating income increased by 10 per cent to $2 billion and adjusted operating income increased by 12 per cent to $2.1 billion due to increases at all operating divisions and lower inter-company eliminations. Revenues included the unfavourable impact of foreign exchange rates of approximately $55 million in the quarter.
For the third quarters of 2016 and 2015, the company had net income attributable to Time Warner shareholders of $1.5 billion and $1.0 billion, respectively.
Chairman, CEO Jeff Bewkes said: “We had a strong third quarter, which keeps us on track to exceed our original 2016 outlook and underscores our leadership in creating and distributing the very best content. In television, HBO took home more Primetime Emmy Awards than any other network for the 15th consecutive year and Time Warner’s divisions won a total of 40 Emmys, more than any other company. CNN’s standout election coverage made it the #1 news network in primetime among adults 18-49 for the fourth consecutive quarter and Turner’s momentum doesn’t stop there. Year-to-date, TBS, TNT and Adult Swim are three of the top five ad-supported cable networks in primetime among adults 18-49. In film, Warner Bros. had a strong quarter led by ‘Suicide Squad’ and has the #1 release of the fall in ‘Sully’, while anticipation is off the charts for J.K. Rowling’s ‘Fantastic Beasts and Where to Find Them’, which hits the big screen on November 18.”
“The agreement we announced on October 22 to be acquired by AT&T represents a great outcome for our shareholders and an excellent opportunity to drive long-term value well into the future. Combining with AT&T is the natural next step in the evolution of our business and allows us to significantly accelerate our most important strategies.”
Turner: Revenues increased by nine per cent ($212 million) to $2.6 billion, due to increases of 12 per cent ($163 million) in subscription revenues, 33 per cent ($33 million) in content and other revenues, and two per cent ($16 million) in ad revenues. Subscription revenues increased due to higher domestic rates and growth at Turner’s international networks, partially offset by the impact of lower domestic subscribers and foreign exchange rates.
Ad revenues benefited from growth at Turner’s domestic news business, partially offset by lower delivery at certain domestic entertainment networks. International advertising was essentially flat with local currency growth offset by the impact of foreign exchange rates. Content and other revenues increased due to higher international licensing revenues.
Operating Income increased by eight per cent ($90 million) to $1.2 billion. The growth in revenues more than offset higher expenses, including programming costs, which grew 5% primarily due to increases at Turner’s news business related to its coverage of the 2016 U.S. Presidential Election.
Adjusted Operating Income increased 12 per cent ($132 million) to $1.2 billion. Adjusted Operating Income for the current year quarter excludes a $25 million asset impairment.
HBO: Revenues increased by four per cent ($59 million) to $1.4 billion, due to an increase of 5% ($62 million) in Subscription revenues, partially offset by a decline of 2% ($3 million) in Content and other revenues. Subscription revenues increased due to higher domestic rates and international growth. The decrease in Content and other revenues was due to lower domestic licensing revenues, partially offset by higher international licensing revenues.
Operating Income and Adjusted Operating Income both increased by two per cent ($11 million) to $530 million, as the growth in revenues more than offset higher expenses. Programming costs grew by 15 per cent reflecting higher acquired theatrical programming expenses due to the timing of availabilities and increased expenses for original series.
Warner Bros.: Revenues increased by seven per cent ($212 million) to $3.4 billion, primarily due to higher theatrical revenues partially offset by lower videogames revenues. Theatrical revenues increased due to the box office releases of ‘Suicide Squad’, ‘The Legend of Tarzan’, ‘Sully’ and ‘Lights Out’.
Videogames revenues declined due to the comparison to the launch of LEGO Dimensions and carryover revenues from Mortal Kombat X in the prior year quarter.
Operating Income increased 11% ($43 million) to $428 million, due to the increase in revenues, partially offset by higher costs of revenues associated with the mix of film releases.
Adjusted Operating Income increased 12% ($45 million) to $433 million.