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Time Warner 3Q in black
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October 14, 1998: 3:36 p.m. ET
Media firm reports $39 million profit; Entertainment group cash flow doubles
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NEW YORK (CNNfn) - Time Warner Inc., the world's largest media concern, Wednesday reported its operations swung into the black in the third quarter as combined cash flow more than doubled.
Time Warner, the parent of CNNfn and this web site, reported net income of $39 million, which was equivalent to a loss of 6 cents a share after preferred dividend requirements. A year earlier, the media conglomerate had a net loss of $35 million, or 20 cents a share.
The results were in line with analysts' consensus estimate, according to First Call.
Time Warner Entertainment, which is 25-percent owned by MediaOne Group Inc., recorded net income of $173 million, up from $80 million a year earlier. Time Warner's equity interest in the partnership is recorded as pretax income.
Combined revenue rose 12 percent to $6.8 billion.
Time Warner's operations were helped by higher advertising rates for its publications and an industry-wide recovery in the music business. In the entertainment group, the poor performance by Warner Brothers at the box office was offset by television revenue for the syndication of "Friends" and "ER."
"Our consistent performance and the robust growth of our integrated media and entertainment franchises are leading us to another record-breaking year," said Time Warner Chairman and Chief Executive Gerald Levin.
Levin further stated that "discussions are going on around the horn" over possible partnerships between broadcasters and CNN, though he declined to name those broadcasters.
Any agreement, he said, would have to include favorable promotion and identification of CNN material.
Moreover, Levin told reporters that Time Warner also is in discussions with various phone companies which are seeking to use Time Warner's cable infrastructure to provide residential phone service.
"We can see a transaction materializing in the near-term," he said.
By the same token, Levin said "it's not surprising that there might be some discussions" with America Online for an agreement whereby the Internet service provider would use Time Warner's cable lines for high-speed data communications.
Shares of Time Warner (TWX) were up 3-1/32 Wednesday afternoon at 84 on the New York Stock Exchange.
For the latest nine months, net income totaled $78 million, or a loss of 27 cents a share after preferred dividends. Revenue totaled $10.4 billion. 
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