SEC Filings

10-Q
TIME WARNER INC. filed this Form 10-Q on 10/26/2017
Entire Document
 


Table of Contents

TIME WARNER INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION – (Continued)

 

by higher Operating Income. Basic and Diluted income from continuing operations per common share were $1.76 and $1.73, respectively, for the three months ended September 30, 2017 and were $1.89 and $1.87, respectively, for the nine months ended September 30, 2016.

Income from continuing operations was $3.856 billion and $3.597 billion for the nine months ended September 30, 2017 and 2016, respectively. Excluding the items noted under “Transactions and Other Items Affecting Comparability” totaling $57 million of income and $67 million of expense for the nine months ended September 30, 2017 and 2016, respectively, Income from continuing operations increased $135 million, primarily due to higher Operating Income, partially offset by higher income tax expense. Basic and Diluted income from continuing operations per common share were $4.95 and $4.88, respectively, for the nine months ended September 30, 2017 and were $4.58 and $4.53, respectively, for the nine months ended September 30, 2016.

Discontinued Operations, Net of Tax.  For the three months ended September 30, 2016, Discontinued operations, net of tax was expense of $5 million related to pension settlement charges related to businesses the Company previously disposed of. For the nine months ended September 30, 2016, Discontinued operations, net of tax was income of $35 million, which also included the recognition of additional tax benefits associated with certain foreign tax attributes of Warner Music Group (“WMG”), which the company disposed of in 2004. Basic and Diluted loss from discontinued operations per common share were $0.00 and $0.01 for the three months ended September 30, 2016. Both Basic and Diluted income from discontinued operations per common share were $0.04 for the nine months ended September 30, 2016.

Net Income attributable to Time Warner shareholders.  Net income attributable to Time Warner shareholders was $1.372 billion and $3.858 billion for the three and nine months ended September 30, 2017, respectively, and $1.467 billion and $3.633 billion for the three and nine months ended September 30, 2016, respectively. Basic and Diluted net income per common share were $1.76 and $1.73, respectively, for the three months ended September 30, 2017 and were $1.89 and $1.86, respectively, for the three months ended September 30, 2016. Basic and Diluted net income per common share were $4.95 and $4.88, respectively, for the nine months ended September 30, 2017 and were $4.62 and $4.57, respectively, for the nine months ended September 30, 2016.

Business Segment Results

Turner.  Revenues and Operating Income of the Turner segment for the three and nine months ended September 30, 2017 and 2016 are as follows (millions):

 

                                                                                                                                                                                                     
     Three Months Ended September 30,   Nine Months Ended September 30,
     2017      2016      % Change   2017      2016      % Change

Revenues:

                

Subscription

   $ 1,666       $ 1,480       13%   $ 5,003       $ 4,455       12%

Advertising

     963         996       (3)%     3,441         3,576       (4)%

Content and other

     139         134       4%     514         495       4%
  

 

 

    

 

 

      

 

 

    

 

 

    

Total revenues

     2,768         2,610       6%     8,958         8,526       5%

Costs of revenues (a)

     (1,002)        (935)      7%     (3,930)        (3,505)      12%

Selling, general and administrative (a)

     (476)        (415)      15%     (1,456)        (1,279)      14%

Gain (loss) on operating assets

     13         (13)      (200)%     68         (15)      NM

Asset impairments

     (5)        (25)      (80)%     (5)        (25)      (80)%

Restructuring and severance costs

     (1)        (8)      (88)%     (8)        (15)      (47)%

Depreciation

     (50)        (48)      4%     (151)        (143)      6%

Amortization

     (4)        (4)      —%     (13)        (13)      —%
  

 

 

    

 

 

      

 

 

    

 

 

    

Operating Income

   $ 1,243       $ 1,162       7%   $ 3,463       $ 3,531       (2)%
  

 

 

    

 

 

      

 

 

    

 

 

    

 

(a)

Costs of revenues and Selling, general and administrative expenses exclude depreciation.

 

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