Atlanta-based Turner Broadcasting System helped boost media giant Time Warner’s second-quarter profits beyond Wall Street’s expectations, the company said Wednesday.
Net income increased to $638 million, or 59 cents a share, compared with net income of $562 million, or 49 cents a share during the same period a year ago.
Advertising revenue from Time Warner’s networks, including Turner, increased by $112 million or 11 percent. For Turner, the key growth factor was advertising that came from its 14-year, $10.8 billion contract with CBS and NCAA to broadcast all of the Division I Men’s basketball tournament games on its TBS, TNT, TruTV or on CBS.
Time Warner Chairman and CEO Jeff Bewkes praised the results of the “upfront” period – the time where broadcast and cable networks pitch their original programming in hopes of getting major advertising dollars.
Turner’s cable networks “pulled in higher dollar commitments” than the broadcast networks, Bewkes said. Turner also owns the Cartoon Network as well as CNN.
“This is a broad endorsement by advertisers, and it reflects the appeal of our brands and programming,” he said.
TNT’s original programs of “Falling Skies,” “The Closer” and “Rizzoli and Isles” continue to be ratings hits for the network, Bewkes said. Ratings are dropping, however, for TNT’s broad range of acquired shows, which include "Law & Order," "CSI: NY" and "Charmed."
Investors peppered Bewkes with questions about the syndicated programming Turner has bought. He said Turner bought most of the shows from the broadcast networks when their ratings were high, but when programs began airing on networks such as TNT, “they started to deteriorate faster than usual.”
“At Turner, we had some frankly bad, as it turned out, programming choices in the series we’ve acquired over the last few years,” he said.
Bewkes said fixing this is a major focus. He pointed to TNT’s recent acquisitions of “The Mentalist,” “Castle” and “Hawaii Five-O,” and TBS’s purchase of “The Big Bang Theory” as shows that will help.
“Keep in mind, even one successful show can have an extreme impact on these networks, and we think we have several here,” he said.
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