Time Warner Cable Inc., fending off a $37.4 billion buyout bid from cable carrier Charter Communications Inc., beat fourth-quarter profit estimates in a financial report Thursday as it said higher fees made up for subscriber losses.
Excluding one-time costs, earnings were $1.82 a share, the New York-based company said in a statement. Analysts had estimated $1.73 on average, according to data compiled by Bloomberg. Net income rose 5.3 percent to $540 million, or $1.89 a share, from $513 million, or $1.68, a year earlier.
Time Warner Cable, the second-largest cable company behind Philadelphia-based Comcast, is relying on rate increases to maintain growth at a time of shrinking demand for cable TV.
It lost 217,000 residential video subscribers in the period, hurt by competition from AT&T Inc., Verizon Communications Inc. and streaming services such as Netflix Inc.
The customers that remain at Time Warner Cable are paying more: Their average monthly bill climbed 2.2 percent to $106.03 last quarter.
“We are geared up to manage this company for the long haul,” Chief Executive Officer Rob Marcus said in the statement. “We’ve got the right assets and a talented, passionate and motivated team aligned around a thoughtful plan.”
The company said it will use new technology and a more user-friendly interface to help win back customers in 2014. It forecast a gain of 1 million residential subscribers over the next three years. In 2014, sales will grow 4 percent to 5 percent, the company said. Time Warner Cable also raised its quarterly dividend 15 percent to 75 cents a share. The dividend is payable on March 17 to shareholders of record on Feb. 28.
While it loses TV customers, Time Warner Cable continues to add broadband Internet subscribers, gaining about 56,000 in the fourth quarter. Still, its performance contrasts with Comcast, which added 43,000 television customers in the same period.
For the year, Time Warner Cable shed about 825,000 TV users, or 6.8 percent. That compares with a 1.4 percent decline for Comcast.