Cable Business Boosts Results at Time Warner

Time Warner Inc.’s first-quarter results exceeded expectations as its Time Warner Cable and HBO posted record profits.

The company’s Time Inc., Warner Bros. and Turner Cable Networks also reported gains.

Time Warner’s profit from operations was $52 million, or a loss of 5 cents a share after preferred dividend payments--far better than the loss of 30 cents forecast by nine analysts polled by IBES International Inc. The company had a loss from operations of $93 million, or 32 cents, a year earlier. Revenue jumped 24% to $5.64 billion.

Time Warner’s cash flow, which includes its entertainment partnership with US West Media Group, rose 27% to a record $1.14 billion, exceeding analyst expectations of about $1.13 billion. The results include a gain of $20 million from the sale of cable assets.

The US West partnership, called Time Warner Entertainment, owns most of Time Warner’s cable systems as well as HBO and Warner Bros. The partnership contributed $657 million to cash flow, up from $561 million.

Much of the growth came from Time Warner’s cable division, where cash flow rose 18% to a record $567 million, with help from higher rates and advertising as well as gains from unspecified asset sales.

Cash flow in the magazine unit rose 15% to $92 million on gains in advertising and circulation.

HBO, meantime, increased 19% to a high of $96 million.

Warner Bros. reported a cash-flow gain of 10% to $150 million, mostly from overseas revenue. Analysts hadn’t expected such growth because the studio has released just six films this year and ranks last among the major studios in market share.