Time Warner Earnings Jump 22% on Strong Ad Sales

Time Warner Inc. (TWX), the owner of Warner Bros., HBO, CNN and DC Comics, on Wednesday said its fourth-quarter profit jumped 22 percent, helped by strong subscription and advertising increases in its TV operations and cost-cutting in publishing.

The results beat Wall Street expectations, and Time Warner offered guidance for 2011 that topped analysts' estimates. The company also raised its dividend.

Its shares rose $1.14, or 3.5 percent, to $33.45 in pre-market trading.

The New York-based media company said its net income rose to $769 million, or 68 cents per share, for the three months ended Dec. 31. That's up from $631 million, or 53 cents per share, a year earlier.

Excluding one-time items, earnings were 67 cents per share, surpassing the average analyst estimate of 62 cents, as polled by FactSet.

Time Warner says overall revenue rose 8 percent $7.8 billion, beating analyst forecasts of $7.5 billion.

For this year, Time Warner said it expects earnings, excluding items, to rise by a percentage in the "low teens" from a base of $2.41 per share recorded for last year on the same basis. Assuming an increase of 12 percent, Time Warner would earn $2.70 per share, above the average analyst estimate at $2.64.

Revenue from HBO and Turner Broadcasting rose 14 percent to $3.3 billion, helped by a 21 percent jump in advertising after the doldrums of the recession.

At the Warner Bros. movie studio, revenue rose 10 percent to $3.6 billion, mainly due to higher TV licensing fees. However, operating income fell 5 percent due to lower DVD sales.

At Time Inc., the publishing division, revenues fell 4 percent to $1.1 billion continuing a long slide as media consumption shifts away from magazines. However, operating income more than doubled to $171 million, as it's already shouldered the upfront expense of cost-cutting initiatives.

Also Wednesday, the Time Warner raised its dividend by 11 percent. The annual dividend is now 94 cents per share, up from 85 cents.

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