The harry potter magic has worked wonders for Time Warner. The company has declared excellent results for the quarter ended December 2011. Increase in revenues were mainly attributed due to the collections from the box office hit harry potter and improved advertisements revenues over the quarter. The company also announced a buyback offer which has pleased many investors. As per the statement made by the company, it has announced the repurchase of 136 million shares for $4.6 billion, a new $4 billion stock repurchase authorization, and an 11 percent increase in its quarterly dividend.
In terms of the top line growth the company has increased revenue by over 5 percent. Reaching $8.2 billion. Profits were up to $773 million, or 76 cents per share, from $769 million or 68 cents per share. Adjusted earnings came to 94 cents per share. This has certainly beat analysts’ expectations that were projection an EPS of 84 cents per share. Revenues from its film business have exceeded the expectations. Income from film contributed to almost 80 percent of the total revenue.
Movies from the harry potter series and also future release such as the dark knight rises which have getting booked ahead of its July release are helping the company. The company has also projected a positive outlook for the future quarter.
The company is also heavily investing in various alternates sources of income Time Warner has already negotiated an extension of its window with Netflix to 56 days, and the company is looking to similarly extend its current 28-day windows with Redbox and other retailers.We maintain a buy on the scrip at current price levels.