Time’s Net Rises 26%; Cost Cutting, Increase in Cable Patrons Cited
Cost cutting in its magazine division and cable subscriber growth helped lift Time Inc.'s net earnings 26% in the second quarter, on a 10% revenue increase.
Net earnings for the quarter ended June 30 were $78 million, compared to $62 million in the like period of 1986, officials of the entertainment, cable and publishing concern said. Revenue rose to $1.04 billion from $945 million last year.
Analysts said the results were generally in line with expectations. “These are good, strong earnings,” said Mark Riely, analyst at the Eberstadt Fleming investment firm in New York.
While magazine advertising revenue declined, cost-cutting efforts that have included staff reductions raised the magazine division’s operating income 28% to $95 million. The division was helped, too, by strength in the circulation of its magazines, J. Richard Munro, Time chairman and chief executive, said in a prepared statement.
Operating income at American Television & Communications, Time’s 82%-owned cable company, grew 24% to $36 million; operating income at the programming division, which includes the HBO pay-television unit, rose 3% to $35 million.
The quarterly results included an after-tax gain of $19 million from the sale of Time’s interest in USA Network. That was partially offset by $9 million paid to refinance the company’s long-term debt at a lower rate.