Time Warner swings to 4th-quarter loss, weighed down by $24.2 billion writedown

NEW YORK (AP) -- Time Warner Inc. reported a fourth-quarter loss, hurt by a $24.2 billion writedown for its cable, publishing and AOL assets.
The New York-based media and entertainment company posted a loss of $16.03 billion, or $4.47 per share, compared with profit of $1.03 billion, or 28 cents per share, a year ago.

Quarterly results were dragged down $4.70 per share mostly due to the $24.2 billion writedown.

Time Warner had anticipated the writedown, predicting in January that it would record an operating loss for the fourth quarter and the full year.

Revenue for the period ended Dec. 31 dipped 3 percent to $12.31 billion from $12.64 billion on softness in its filmed entertainment, AOL and publishing units.

Analysts polled by Thomson Reuters forecast earnings of 26 cents per share on revenue of $12.71 billion. Analysts' estimates typically exclude one-time items.

At AOL, revenue slid 23 percent to $968 million as subscription revenue tumbled 27 percent and ad sales dipped 18 percent.

Time Warner Cable revenue rose 8 percent to $4.4 billion, while filmed entertainment revenue dropped 11 percent to $3.1 billion.

Time Warner is nearing completion of the Time Warner Cable spinoff, which is anticipated to close in the first quarter. The cable company will pay a one-time dividend of $10.9 billion to shareholders, the bulk of which will go to the parent.

The move is expected to help the remaining company better focus on its strengths in content, especially if it can also shed all or part of AOL, acquired as part of AOL's $106 billion purchase of Time Warner in 2001.

Revenue from Time Warner's networks, which include HBO and Turner Broadcasting, climbed 9 percent to $2.9 billion.

The publishing division reported a 13 percent decline in revenue to $1.3 billion, primarily pulled down by a 20 percent drop in ad sales.

Time Warner expects 2009 adjusted earnings from continuing operations to be about flat compared with 66 cents per share in 2008.

Analysts forecast full-year earnings of 99 cents per share.

For the year, the company reported a loss of $13.4 billion, or $3.74 per share, compared with profit of $4.39 billion, or $1.17 per share, in the previous year.

Annual revenue grew 1 percent to $46.98 billion from $46.48 billion.

Time Warner has also announced layoffs at its various divisions because of the recession.

Last month, its Warner Bros. Entertainment movie studio announced cuts of nearly 800 jobs, or 10 percent of its global work force, through layoffs, attrition and outsourcing, citing sinking consumer demand and the overall weak economy.

The company's AOL Internet unit also announced a cut of 700 jobs, or about 10 percent of the work force, to cope with a slowing advertising market. The unit also said it was skipping merit pay raises in 2009.