Feeds

Meltdown turns Time Warner red

AOL owner/Lehman landlord admits $25bn write-down

Build a business case: developing custom apps

Time Warner expects to report a red 2008, thanks to a whopping $25bn impairment charge for its cable, magazine publishing, and, yes, AOL businesses. This would be the media giant's first annual loss in six years.

Naturally, it blames the Meltdown. "The economic environment has proved somewhat more challenging than the company previously expected, particularly for the advertising businesses at the AOL and publishing segments," Time Warner said in a statement released this morning.

But that's just a start. The company was directly affected by the demise of Meltdown poster child Lehman Brothers. The bankrupt investment bank was a tenant in Time Warner's flagship New York office building. After a restructured lease, the company will stomach another loss of between $50 million and $60 million.

It also expects roughly $40 million in credit losses from bankrupt customers like Circuit City. And there's that recent court judgment against the company's Turner Broadcasting System (related to the sale of its winter sports teams), which could result in a $281 million charge.

For 2007, Time Warner - which owns CNN, Time magazine, and the Warner Brothers film studio as well as AOL, Time Warner Cable, and the Turner Broadcasting Company - reported an operating profit of $8.9bn. It last reported a year-end loss in 2002, when the bottom fell out of AOL.

This time around, Time Warner Cable is the biggest disappointment, representing $15bn of the company's $25bn write-down.

When Time Warner last provided a financial outlook on November 5, it expected adjusting operating income before Depreciation and Amortization to grow around 5 per cent. Now that figures is down to 1 per cent.

Time Warner is due to announced its fourth quarter financial results on February 4. ®

The essential guide to IT transformation

More from The Register

next story
Microsoft exits climate denier lobby group
ALEC will have to do without Redmond, it seems
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Amazon takes swipe at PayPal, Square with card reader for mobes
Etailer plans to undercut rivals with low transaction fee offer
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
7 Elements of Radically Simple OS Migration
Avoid the typical headaches of OS migration during your next project by learning about 7 elements of radically simple OS migration.
BYOD's dark side: Data protection
An endpoint data protection solution that adds value to the user and the organization so it can protect itself from data loss as well as leverage corporate data.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?