Time Warner Beats Consensus EPS Estimates; Stock Up (TWX)

| About: Time Warner (TWX)
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Time Warner (ticker: TWX) reported Q4 2005 earnings results today that beat consensus EPS estimates. Details:

Q4 Results:

  • Revenue rose 7% y-o-y to $11.88 billion in-line with consensus estimates.
  • Adjusted operating income before depreciation and amortization rose 18% to $2.9 billion.
  • Operating income rose 37% to $2.2 billion.
  • Diluted EPS (before discontinued operations and cumulative effect of accounting change) was $0.29 vs $0.24 in Q4 2004, and above consensus estimate of $0.22.
  • FY 2005 Results:

  • Cash from operations was $5.0 billion.
  • Free cash flow was $4.4 billion.
  • As of December 31, net debt was $16.1 billion (flat compared to the beginning of 2005).
  • Update on $12.5 Billion Stock Repurchase Program:

  • Through January 31, 2006, the Company has repurchased approximately 167 million shares of common stock for approximately $3.0 billion.
  • 2006 Management Guidance:

  • TWX expects its 2006 full-year growth rate in adjusted operating income before depreciation and amortization to be in the high-single digits, off a base of $10.3 billion in 2005 (restated to reflect the impact of expensing stock options).
  • TWX expects to convert 35% - 45% of its 2006 adjusted operating income before depreciation and amortization into free cash flow.