Wednesday
Gains Boost AOL, but Accounting Probe Heats Up
07/23/2003 07:53 AM EDT
Two large gains lifted AOL Time Warner (AOL:NYSE) to sharply higher earnings in the second quarter over a year ago, while revenue rose 6% and the company's overall debt fell to $24.2 billion from $26.3 billion.
The media giant also said full-year revenue would rise by a mid-single-digit percentage over the $41 billion it put up in 2002, roughly in line with the analyst consensus of $42.85 billion as compiled by Thomson First Call. The company's revenue outlook reflects expectations for a mid-single-digit revenue decline at its America Online unit and a 35% to 45% fall in AOL advertising revenue.
The shares were down 15 cents, or 0.9%, to $16.70 on Instinet.
AOL also said the government continues to investigate its accounting practices, and recently determined that it misallocated some of the $400 million it received from Bertelsmann in the sale of AOL Europe. The company said it believes its accounting is right but conceded that view could change as it continues to investigate itself.
On the bottom line in the second quarter, AOL Time Warner earned $1.1 billion, or 23 cents a share, reflecting pretax gains of $542 million and $760 million for the sale of Comedy Central and its Netscape settlement with Microsoft (MSFT:Nasdaq - news - commentary) , respectively. The quarter also included a $277 million asset-impairment writedown. The after-tax impact of all the items was $524 million, or about 11 cents a share, leaving the company with earnings of about 12 cents prior to the items. That was 2 cents better than analysts were forecasting.
Earnings in the year-ago quarter were $396 million, or 9 cents a share, including a $364 million pretax investment charge.
07/23/2003 07:53 AM EDT
Two large gains lifted AOL Time Warner (AOL:NYSE) to sharply higher earnings in the second quarter over a year ago, while revenue rose 6% and the company's overall debt fell to $24.2 billion from $26.3 billion.
The media giant also said full-year revenue would rise by a mid-single-digit percentage over the $41 billion it put up in 2002, roughly in line with the analyst consensus of $42.85 billion as compiled by Thomson First Call. The company's revenue outlook reflects expectations for a mid-single-digit revenue decline at its America Online unit and a 35% to 45% fall in AOL advertising revenue.
The shares were down 15 cents, or 0.9%, to $16.70 on Instinet.
AOL also said the government continues to investigate its accounting practices, and recently determined that it misallocated some of the $400 million it received from Bertelsmann in the sale of AOL Europe. The company said it believes its accounting is right but conceded that view could change as it continues to investigate itself.
On the bottom line in the second quarter, AOL Time Warner earned $1.1 billion, or 23 cents a share, reflecting pretax gains of $542 million and $760 million for the sale of Comedy Central and its Netscape settlement with Microsoft (MSFT:Nasdaq - news - commentary) , respectively. The quarter also included a $277 million asset-impairment writedown. The after-tax impact of all the items was $524 million, or about 11 cents a share, leaving the company with earnings of about 12 cents prior to the items. That was 2 cents better than analysts were forecasting.
Earnings in the year-ago quarter were $396 million, or 9 cents a share, including a $364 million pretax investment charge.
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