Television show production and movies at Burbank’s Warner Bros. Studios played a pivotal role in driving New York-based parent Time Warner Inc. to record profits in 2010 and a strong fourth-quarter financial performance, top executives said Wednesday.
Time Warner Chief Executive Jeff Bewkes said he expects production of television shows for network and cable to grow in 2011.
In a conference call with investors, Bewkes said the company plans to “ramp up the development of new shows for broadcast, particularly comedies, and we’ll increase production to meet the demand for original cable series.”
Time Warner last year saw revenues rise 6% over 2009, to $26.9 billion. Adjusted profits increased 17% to $5.4 billon. In the fourth quarter of 2010, revenue increased 8% above the last quarter of 2009 to $7.8 billion, and adjusted profits rose $14% to $1.4 billion.
In the fourth quarter of 2010, network revenue was $3.3 billion, $410 million higher than the same period in 2009. Filmed entertainment generated $3.6 billion in revenue, $316 million over the last quarter of 2009.
The buoyant news was overshadowed somewhat by Warner Bros. television’s top network earner “Two and a Half Men,” with star Charlie Sheen’s return to substance abuse rehabilitation, forcing production to shut down.
But Bewkes touted the success of shows including HBO’s “True Blood,” “Entourage” and “Boardwalk Empire,” and said television production will grow at home and abroad in 2011. Last year, the company bought London-based Shed Media, producer of “Supernanny” and other shows.
International cable subscriptions and other international sources of funds generated 18% of the company’s revenue, compared to 15% in 2009.
Time Warner Chief Financial Officer John Martin said production costs for television and movies grew “in the high single digits” as activity picked up. Television advertising revenues for the company that owns HBO, CNN and Turner Broadcasting System grew in every area except news, he said.
Martin said he expects movie revenues, which fell short of 2009 figures, to grow next year with the release of the final film in the Harry Potter series, as well as the release of the final two Harry Potter movies for home viewing.
While Netflix and other companies have undermined the once-powerful home video market, Bewkes said Time Warner’s efforts to provide digital downloads of shows and movies in formats ranging from cable television to tablets will grow more aggressive in 2011.
“This is a time of significant change in the media industry,” Bewkes said. “But I am confident ,more than ever, that we are well-positioned to benefit as shifts in technology increase the demand for our content, both in the United States and around the world.”