Time Warner Inc. Reports Fourth-Quarter and Full-Year 2015 Results
OREANDA-NEWS. Time Warner Inc. (NYSE:TWX) today reported financial results for its fourth quarter and full year ended December 31, 2015.
Chairman and Chief Executive Officer Jeff Bewkes said: “We had another very successful year in 2015, demonstrating once again Time Warner’s ability to deliver strong financial performance as well as creative and programming excellence. Revenues grew 3% and Adjusted Operating Income was up 19%. All three of our operating divisions increased revenue and profits while also investing to capitalize on the shift to on-demand viewing and growing worldwide demand for the very best video content. Warner Bros. had its best year ever in videogames, led by Mortal Kombat X and Batman: Arkham Knight, and remained the number one supplier of broadcast television programming, including the biggest new hit of the TV season in Blindspot. As we embark on what promises to be a very strong year for Warner Bros. theatrically, Mad Max: Fury Road and Creed received a combined 11 nominations for the 88th Academy Awards.”
Mr. Bewkes continued: “Home Box Office grew subscribers both on its linear networks and through HBO NOW, our new stand-alone streaming service. Once again, HBO distinguished itself with the combination of the biggest Hollywood hits and best original programming. In 2015, HBO received 43 Primetime Emmys, the most in a single year by any network in at least 25 years — led by a record 12 Emmys for Game of Thrones. Turner continued to prove its tremendous value to its audiences, distributors, and advertisers with TBS, TNT and Adult Swim all ranking among ad-supported cable’s top 10 networks in primetime among adults 18-49 for the year. CNN was the fastest-growing top 40 cable network in its key demographic in the U.S. for the year, and Cartoon Network was the only top 3 kids network to grow ratings. Further demonstrating our commitment to shareholder returns, during 2015 we returned $4.8 billion to our shareholders through share repurchases and dividends, and this morning announced a 15% increase to our dividend and a new $5 billion share repurchase program.”
Full-Year Company Results
Full-year revenues and Adjusted Operating Income increased 3% and 19% from 2014 to $28.1 billion and $6.9 billion, respectively, due to growth across all operating divisions. The growth in Adjusted Operating Income benefited from lower programming charges at Turner and restructuring and severance charges across the Company, partially offset by a swing in intersegment eliminations. Revenues and Adjusted Operating Income included the unfavorable impact of foreign exchange rates of approximately $1.1 billion and $480 million, respectively, in the year. Operating Income increased 15% from 2014 to $6.9 billion.
The Company posted 2015 Adjusted Diluted Income per Common Share from Continuing Operations (“Adjusted EPS”) of $4.75, up 14% from $4.15 in the prior year. Adjusted EPS included the unfavorable impact of foreign exchange rates of $0.50 in the current year. Diluted Income per Common Share from Continuing Operations was $4.58 in 2015 compared to $4.41 in 2014.
In 2015, Cash Provided by Operations from Continuing Operations reached $3.9 billion and Free Cash Flow totaled $3.6 billion. As of December 31, 2015, Net Debt was $21.6 billion, up from $19.8 billion at the end of 2014, due to share repurchases, dividends and investments and acquisitions, partially offset by the generation of Free Cash Flow.
Fourth-Quarter Company Results
Revenues decreased 6% to $7.1 billion due to a decline at Warner Bros., partially offset by increases at Home Box Office and Turner. Adjusted Operating Income declined 12% to $1.4 billion due to decreases at all operating divisions as well as a swing in intercompany eliminations. Revenues and Adjusted Operating Income included the unfavorable impact of foreign exchange rates of approximately $270 million and $115 million, respectively, in the quarter. Operating Income was flat at $1.4 billion as the prior year quarter included a $173 million foreign currency charge related to the remeasurement of net monetary assets denominated in Venezuelan currency resulting from a change in the foreign currency exchange rate used by the Company.
The Company posted Adjusted EPS of $1.06, up 8% versus $0.98 for the prior year quarter. Adjusted EPS included the unfavorable impact of foreign exchange rates of $0.12 in the current year quarter. Diluted Income per Common Share from Continuing Operations was $1.06 compared to $0.84 in the prior year quarter.
Refer to “Use of Non-GAAP Financial Measures” in this release for a discussion of the non-GAAP financial measures used in this release and the reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures.
Stock Repurchase Program Update
From January 1, 2015 through February 5, 2016, the Company repurchased approximately 52 million shares of common stock for approximately $4.1 billion. These amounts reflect the purchase of approximately 11 million shares of common stock for approximately $787 million since the amounts reported in the Company’s third quarter earnings release on November 4, 2015.
In January 2016, the Company’s Board of Directors authorized a total of $5 billion in share repurchases beginning January 1, 2016, including the amount remaining under the prior authorization.
Regular Quarterly Dividend
On February 9, 2016, the Company’s Board of Directors increased the Company’s regular quarterly dividend by 15% to $0.4025 per share.
ABOUT TIME WARNER INC.
Time Warner Inc., a global leader in media and entertainment with businesses in television networks and film and TV entertainment, uses its industry-leading operating scale and brands to create, package and deliver high-quality content worldwide on a multi-platform basis.