Earnings Review and Free Research Report: Time Warner’s Revenue Grew 5%; EPS Gained 11.7%
Research Desk Line-up: Twenty-First Century Fox Post Earnings Coverage
LONDON, UK / ACCESSWIRE / August 18, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Time Warner Inc. (NYSE: TWX), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=TWX, following the Company's release of its second quarter fiscal 2017 operating results on August 01, 2017. The media conglomerate outperformed earnings expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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Get more of our free earnings reports coverage from other constituents of the Entertainment - Diversified industry. Pro-TD has currently selected Twenty-First Century Fox, Inc. (NASDAQ: FOXA) for due-diligence and potential coverage as the Company reported on August 09, 2017, its financial results for the three months and full year which ended on June 30, 2017. Register for a free membership today, and be among the early birds that get access to our report on Twenty-First Century Fox when we publish it.
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Earnings Reviewed
For the quarter ended June 30, 2017, Time Warner's revenues grew 5% to $7.33 billion compared to $6.95 billion, driven by increases at all operating divisions, partially offset by higher intersegment eliminations. The Company's revenue numbers came in marginally below analysts' estimates of $7.34 billion.
For Q2 2017, Time Warner's operating income decreased 8% to $1.69 billion compared to $1.85 billion in Q2 2016, due to declines at Warner Bros. and Turner and higher corporate expenses partially offset by an increase at Home Box Office (HBO).
For Q2 2017, the Company posted income from continuing operations attributable to Time Warner's shareholders of $1.1 billion and earnings of $1.34 per share compared to income from continuing operations attributable to Time Warner's shareholders for Q2 2016 of $1.0 billion and $1.20 per share. Time Warner's adjusted EPS was $1.33 for Q2 2017 compared to $1.29 for Q2 2016 and easily topped Wall Street's estimates of $1.19 per share.
Time Warner's Segment Performance
Turner - For Q2 2017, the Turner segment's revenues increased 3% to $3.1 billion, due to increases of 13% in subscription revenues, partially offset by declines of 6% in advertising revenues and 8% in content and other revenues.
During Q2 2017, Turner's operating income fell 7% to $1.1 billion. The growth in revenues was more than offset by higher expenses, mainly due to increased programming costs. The segment's adjusted operating income decreased 9% to $1.0 billion.
Home Box Office (HBO) - During Q2 2017, HBO's revenues grew 1% to $1.5 billion, due to an increase in subscription revenues, partially offset by a decline in Content and Other revenues. Subscription revenues increased due to higher domestic rates and subscribers and international growth. The segment's operating income increased 10% to $531 million, reflecting growth in revenues and lower expenses, including declines in restructuring and severance, programming and distribution costs. Programming costs decreased 3% due to lower original programming expenses, including lower programming charges and the timing of original series. Adjusted operating income increased 14% to $546 million.
Warner Bros - During Q2 2017, Warner Bros' revenues increased 12% to $3.0 billion due to higher theatrical and videogames revenues, partially offset by lower television revenues. The increase in theatrical revenues was mainly due to the box office release of Wonder Woman, and higher home entertainment revenues primarily related to the release of The LEGO Batman Movie and carryover from Fantastic Beasts and Where to Find Them.
The segment's operating income decreased 28% to $223 million as growth in revenues was partially offset by higher associated film costs and print and advertising expenses primarily associated with the mix and number of film and games releases. The segment's adjusted operating income increased 20% to $261 million.
Cash Matters
For H1 2017, Time Warner's cash provided by operations from continuing operations reached $2.5 billion and free cash flow totaled $2.3 billion, increasing 25% and 22%, respectively, compared to H1 2016.
Outlook
Time Warner continues to expect its FY17 adjusted operating income to grow in the high single-digits, based on current foreign exchange rates.
The Company expects Turner's subscription revenue growth in H2 2017 to increase at a similar rate as in H1 2017. Time Warner anticipates Turner's total advertising revenues will decline in the low single-digits in Q3 2017 compared to the prior year's same quarter, primarily due to lower audience delivery at its domestic entertainment networks.
Time Warner is forecasting HBO's subscription revenue growth rate will increase in H2 2017 relative to Q2 2017 and its total revenues in the second half of 2017 will increase at a higher rate compared to H1 2017. In H2 2017 the Company expects HBO's programming costs to increase at an elevated rate compared to the prior year due to the timing of original programming.
Stock Performance
At the closing bell, on Thursday, August 17, 2017, Time Warner's stock marginally slipped 0.30%, ending the trading session at $101.61. A total volume of 2.99 million shares have exchanged hands. The Company's stock price rallied 4.74% in the last three months, 5.42% in the past six months, and 25.37% in the previous twelve months. Moreover, the stock gained 5.26% since the start of the year. The stock is trading at a PE ratio of 18.77 and has a dividend yield of 1.58%. The stock currently has a market cap of $79.06 billion.
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