Page last updated at 14:52 GMT, Wednesday, 3 February 2010

Sherlock Holmes helps boost Time Warner profit

Robert Downey Junior and Jude Law on Sherlock Holmes poster
The famous detective helps Time Warner take a bow

Time Warner has reported fourth quarter profits, thanks to the hit films Sherlock Holmes and The Hangover.

The move marks a return to profit for the company in its first results since the split from AOL last year.

Time Warner is now focused on movies and TV. Net income for the newly slimmed-down company was $627m (£387m).

That compares with a $16bn loss in the last three months of 2008 thanks to write-downs on the value of its AOL and cable assets.

Also reporting on Wednesday was the much smaller AOL.

Its fourth quarter results showed a similar pattern to Time Warner - net income was $1.4m after a loss of $1.9bn the year before, which resulted from costs relating to the short-lived marriage.

Profit growth

Time Warner's revenue rose by 2% to $7.3bn and the company said it would increase the dividend it pays to shareholders by 13%.

It also said it would treble the amount of money it planned to use to buy back stock to $3bn - something that will reduce the number of shares in issue and thereby spread any future profit among a smaller number of shares.

Time Warner said it expected its earnings to produce double digit growth in 2010.

Quickie divorce

Time Warner's merger with the US internet giant AOL lasted less than a decade.

At the time, the 2001 marriage was dubbed the "deal of the century" - one that brought superstars of both old and new media together.

But the new media element, AOL, soon started to look jaded as its once-popular dial-up internet model was superseded by broadband.

Time Warner's long-established collection of TV and magazines were also hit by new developments. It lost revenue as the media industry fragmented further.

The figures will be seen as proof that the divorce from AOL was the right thing to do.

Time Warner's businesses include Warner Brothers Pictures and the television channel CNN.

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Financial TimesTime Warner joins rebound from crisis - 13 hrs ago
The Independent Time seeks closure on the worst deal in history - 14 hrs ago
CNBC Time Warner Profit Rises, Dividend Raised - 18 hrs ago
NPR Time Warner Posts 4Q Profit Despite Ad Drop - 19 hrs ago
Reuters WRAPUP 1-Signs of media recovery abound as earnings roll in - 22 hrs ago
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