Time Warner chief executive Jeff Bewkes on Wednesday said the company, which owns assets including Warner Bros and HBO, was doing better than the investment community realised.
“I’m going to let you in on a secret, we’re going to do better than everybody thinks we’re going to do, including any financial analysts that happen to be listening to this,” Mr Bewkes said in an interview with television host Charlie Rose at a Tribeca Film Festival event sponsored by Bloomberg.
When Mr Rose asked if Mr Bewkes was referring to the company’s first-quarter results, which are to be released next Wednesday, the Time Warner chief said he was speaking more generally.
“Not just this month, but we’re going to do better throughout than everybody has written, because I read what they wrote, and they’re wrong,” Mr Bewkes said.
Time Warner reported higher revenue and profit when it announced fourth-quarter earnings in February.
Mr Bewkes said that Time Warner had outperformed other media companies in recent years. “We had 30 plus per cent earnings per share growth the last two years,” Mr Bewkes said. “The rest of the media business in two years went down 20 to 40 per cent. We went up 30 per cent, they went down.”
Mr Bewkes said Time Warner, which lost more than $100bn in its failed merger with AOL, would use its capital to focus on buying back shares from investors, rather than pursuing acquisitions of other media companies. “We can buy something that we know full well is cheaper than what it sells for, and that would be our stock,” Mr Bewkes said.
Analysts have focused on Time Warner’s cash reserves in recent months. “Time Warner’s balance sheet could be underutilised, as the company continues to sit on cash, rather than deploy to shareholders via share repurchases and high cash balances dilute returns,” said Morgan Stanley analyst Benjamin Swinburne in a note on Tuesday.
If Time Warner does acquire new companies, Mr Bewkes suggested they would be in emerging markets.
“Most of the things we’ve bought have been outside [the US, in] South America, eastern Europe, some in India,” he said. “We will do that because there’s a lot of people out there. Russia is going to be now the fifth-largest theatrical market.”
Mr Bewkes, who had attacked Netflix, the streaming video service, in recent months, struck a more conciliatory tone when discussing the company, which has become the largest subscription-based media company in the US.
“I do have a fondness for subscription television, and Netflix is subscription television,” Mr Bewkes said. “So welcome, brother.”
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