Cost Savings Initiatives Spur Bigger Profits at Time Inc.
Publisherâ€™s parent company reports first half financial results.
Consumer publishing giant Time Inc. reported an operating income of $203 million through the first six months of 2010, nearly three times the $70 million it pulled in during the same period last year, according to parent company Time Warner, which reported its first-half financial earnings Wednesday. Revenues at the publishing group remained flat at roughly $1.72 billion.
During the second quarter, Time Inc. reported an operating income of $153 million, up 50 percent from $102 million during the same three-month period in 2009. Revenues remained steady compared to last yearâ€™s period at $919 million.
Time Inc. attributed the profit gains to company-wide cost savings initiatives which resulted in lower pension expenses. It also cited higher domestic magazine revenues in print and digital. Advertising revenue during the second quarter grew 4 percent, subscription revenues stayed flat and other revenues dropped 23 percent. Meanwhile, the company says it increased its share of U.S. magazine advertising to 21 percentâ€”a gain of 1.8 percent points from the same period last year.
Overall, Time Warner reported $2.65 billion in operating profit through the first half (up more than 30 percent) on $12.69 billion in revenue. The company also upgraded its outlook for 2010, projecting adjusted earnings per share of at least 20 percent. Thatâ€™s up from its May 5 outlook for adjusted EPS of growth at least in the mid-teens.