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Last Updated: Wednesday, 2 November 2005, 15:42 GMT
Time Warner sees 80% profit rise
Time Warner chief Dick Parsons
Time Warner chief Parsons predicts strong growth
Time Warner has reported net profits of $897m (507m) for the three months to September, 80% higher than a year earlier.

Cable TV customers upgrading to premium cable TV or adding broadband or phone services helped fuel profits.

The world's largest media company also vowed to spend $12.5bn to buy back shares from investors.

This should help boost the value of its shares, which slumped by 75% following the group's merger AOL in 2000.

Time Warner's promised buyback program is far bigger than the $5bn one previously promised - although it still falls short of the $20bn demanded by some investors.

More than doubling the stock buyback will be encouraging to investors
Fulcrum Global Partners analyst Richard Greenfield

The anger among investors following the deal has for years been directed at AOL's co-founder Steve Case.

The AOL name was dropped from the group's name in 2003. Mr Case, one of the designers of the AOL Time Warner deal, resigned on Monday.

"More than doubling the stock buyback will be encouraging to investors," said Fulcrum Global Partners analyst Richard Greenfield.

Future growth

AOL chief Steve Case and Time Warner chief Gerald Levin as the deal is announced, Monday, Jan. 10, 2000
Steve Case, who designed the disastrous deal, stepped down on Monday

Warner Brothers film studio revenues rose 6% following successful releases of "Charlie and the Chocolate Factory" and "Batman Begins".

"In the fourth quarter, we'll continue to extend the competitive advantages of our cable company and our other businesses to fuel growth in 2006 and beyond," said chief executive Dick Parsons.

The group's two halves are somewhat out of balance.

While Time Warner revenues rose 6.1% during the quarter to $10.5bn, AOL revenues fell 5% despite a near-30% rise in advertising revenue, as subscribers continued to desert it in droves.

But AOL is moving away from its reliance on dwindling numbers of dial-up internet subscribers, making itself more of a catch for a range of potential suitors such as Google, Microsoft or Comcast who might be attracted by its more than 20 million US subscribers.

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