SEC Filings

8-K
TIME WARNER INC. filed this Form 8-K on 10/26/2017
Entire Document
 


Operating Income increased 26% ($110 million) to $538 million due to the increase in revenues and higher contributions from this quarter’s box office releases, including It and Annabelle: Creation, as well as lower print and advertising costs due to fewer releases.

Adjusted Operating Income increased 33% ($143 million) to $576 million.

Through October 24, It has grossed over $650 million at the global box office, is the highest grossing horror film ever and posted the largest domestic opening weekend ever for a September film release. With the release of Annabelle: Creation, the Conjuring universe of films has grossed more than $1.2 billion at the global box office to date. For the 2017-2018 television season, Warner Bros. is producing 37 shows across the broadcast networks, including Young Sheldon, which was the most-watched comedy series premiere in six years.

CONSOLIDATED NET INCOME AND PER SHARE RESULTS

Third-Quarter Results

For the three months ended September 30, 2017, the Company had Income from Continuing Operations attributable to Time Warner Inc. shareholders of $1.4 billion and EPS of $1.73. This compares to Income from Continuing Operations attributable to Time Warner Inc. shareholders for the third quarter of 2016 of $1.5 billion and EPS of $1.87. Adjusted EPS was $1.82 for the three months ended September 30, 2017, compared to $1.83 for last year’s third quarter. EPS and Adjusted EPS in the prior year quarter included a $0.28 net tax benefit from an IRS-approved tax accounting method change.

For the third quarters of 2017 and 2016, the Company had Net Income attributable to Time Warner Inc. shareholders of $1.4 billion and $1.5 billion, respectively.

USE OF NON-GAAP FINANCIAL MEASURES

The Company utilizes Adjusted Operating Income (Loss), Adjusted Operating Income margin and Adjusted EPS, among other measures, to evaluate the performance of its businesses. These measures are considered important indicators of the operational strength of the Company’s businesses. Some limitations of Adjusted Operating Income (Loss), Adjusted Operating Income margin and Adjusted EPS are that they do not reflect certain charges that affect the operating results of the Company’s businesses and they involve judgment as to whether items affect fundamental operating performance.

Adjusted Operating Income (Loss) is Operating Income (Loss) excluding the impact of noncash impairments of goodwill, intangible and fixed assets; gains and losses on operating assets (other than deferred gains on sale-leasebacks); gains and losses recognized in connection with pension and other postretirement benefit plan curtailments or settlements; external costs related to mergers, acquisitions or dispositions (including restructuring and severance costs associated with dispositions), as well as contingent consideration related to such transactions, to the extent such costs are expensed; amounts related to securities litigation and government investigations; and the foreign currency loss during the three months ended March 31, 2015 related to the translation of net monetary assets denominated in Venezuelan currency resulting from the Company’s change to the Simadi exchange rate during the quarter ended March 31, 2015. Adjusted Operating Income margin is defined as Adjusted Operating Income divided by Revenues.

Beginning with periods ending on or after October 1, 2016, Adjusted Operating Income (Loss) is defined as Operating Income (Loss) excluding the impact of noncash impairments of goodwill, intangible and fixed assets; gains and losses on operating assets (other than deferred gains on sale-leasebacks); gains and losses recognized in connection with pension and other postretirement benefit plan curtailments or settlements; costs related to the pending acquisition by AT&T Inc. (including retention, restructuring and severance costs associated with the transaction); external costs related to mergers, acquisitions or dispositions (including restructuring and severance costs associated with dispositions), as well as contingent consideration related to such transactions, to the extent such costs are expensed; amounts related to securities litigation and government investigations; and the foreign

 

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