first-quarter earnings rose 46% from a year ago as digital sales helped boost margins in the recorded music segment and the company eliminated a handful of expenses that dragged down the year-ago period.
Warner, the former
unit that went public in 2005 after about a year in private hands, earned $69 million, or 46 cents a share, in the quarter, compared with $36 million, or 31 cents a share, a year ago.
Analysts surveyed by Thomson First Call had been expecting earnings of 40 cents a share in the latest quarter.
The year-ago period included an unrealized loss on warrants of $22 million; a minority interest expense of $5 million, and an equity share of losses in investees of $1 million. None of the expenses had corresponding items in the latest quarter.
Warner's revenue slipped 4% from a year ago to $1.04 billion, missing the $1.09 billion consensus. Sales fell because of unfavorable currency translation and the sale of the company's sheet-music business in May 2005.
Within its biggest unit, recorded music, Warner's operating income before depreciation and amortization rose 6% from a year ago to $206 million, reflecting a better product mix, including higher-margin digital sales. The OBIDA margin was 22.4% in the quarter, up 1.8 percentage points from a year ago.