Co. shows financial benefits of deal
Responding to investor complaints that its financial structure is too hard to understand, AOL Time Warner attempted to clarify things Monday, releasing figures to show the effect of its cable partnership with Advance/Newhouse Communications, which is skedded to be revamped before January.
According to the figures, which show the effect of the partnership for 2000, 2001 and the first half of this year, AOL TW would have had lower revenue — and lower debt — without the partnership.
For the second quarter of the year, AOL TW would have had revenue of $10.2 billion without the partnership, down from the actual $10.6 billion it reported. Company debt at the end of June would have been $25.5 billion instead of $27.9 billion. Profit of $394 million would have been unchanged.
Under the revamp of the Time Warner Cable-Advance/Newhouse partnership, Advance/Newhouse will take over direct management and financial responsibility for 2.1 million of the partnership’s 7 million cable subs instead of having a one-third share in the whole partnership.