Business and Finance

Time Warner Inc. reported fourth-quarter earnings Wednesday that rose from a year earlier and beat Wall Street’s expectations, largely due to the final Harry Potter movie.

The company also hiked its dividend and announced a new share buyback.

Shares of Time Warner (, Fortune 500) rose more than 2% in early trading.

Time Warner’s sales rose 5% to $8.2 billion, topping analysts’ forecasts of $8.1 billion. The growth was led by 7% revenue growth at Warner Bros., thanks to the DVD and Blu-ray release of Harry Potter and the Deathly Hallows: Part 2, the final installment of the wildly successful series.

The film’s DVDs, which went on sale in November, ranked within the top three selling DVDs domestically in 2011, and helped offset lower revenues from the silver screen releases and television license fees.

While Harry Potter’s days at the box office have come to an end, Time Warner CEO Jeff Bewkes said the franchise will live on and be a source of strength for the company.

Time Warner rakes in licensing fees for The Wizarding World of Harry Potter from theme park Universal Orlando, owned by NBCUniversal.

The park is set to expand in Florida, and a second Wizarding World of Harry Potter will open at the Universal Studios Hollywood theme park in California, bringing in more fees starting in 2014.

Bewkes also noted the excitement building up for The Dark Knight Rises, which will mark the end of Christopher Nolan’s Batman trilogy. Midnight IMAX shows for the July release are already selling out, he said.

Time Warner’s television networks were also strong performers during the fourth quarter. Revenue climbed by almost 5% at the networks, which include CNN, HBO, TBS, TNT and truTV.

Sales from subscriptions at the television networks edged up 5% while advertising sales ticked up 2%. Meanwhile, content revenue spiked 16% thanks to higher sales of HBO’s original programming, which includes "True Blood" and "Game of Thrones."

But revenue at Time Warner’s publishing unit, Time Inc. declined 1%, as sales from subscriptions decreased and advertising sales remained flat during the quarter business cards design.

The New York-based parent company of CNNMoney.com and Fortune said its net income rose to $773 million, or 76 cents per share, up just 0.5% from the same quarter in the prior year.

Adjusted net income, the commonly used profit metric for media companies, rose 25% to $946 million, or 94 cents per share. Analysts polled by Thomson Reuters were looking for earnings per share of 87 cents.

Separately, Time Warner said it is raising its quarterly cash dividend by 11% to 26 cents per share, and announced a $4 billion stock repurchase program.

Throughout 2011, the media giant has repurchased approximately 144 million shares, for about $4.9 billion, helping its stock jump more than 12% in 2011.

For 2012, the company said it expects adjusted EPS growth to be in the low double digits, from a base of $2.89 in 2011. That would compare to 20% growth in adjusted EPS in 2011.

"We’re investing aggressively in programming, production and marketing," said Bewkes, adding that the company is focusing on expanding its international presence.

Movie ticket sales hit 16-year low

For the full year, Time Warner booked a $2.9 profit and an 8% jump in revenue to $29 billion. Both topped Wall Street estimates. Adjusted net income rose 12% to $3.1 billion, or $2.89 per share. Analysts polled by Thomson Reuters were looking for earnings per share of $2.82.

The company’s TV networks and Warner Bros. divisions both reported a 9% jump in revenue for 2011, primarily due to sports programming, including the NCAA basketball tournament, that aired on TBS, TNT and truTV and the Harry Potter movies.

Rival media conglomerate Walt Disney (, Fortune 500) also posted a better-than-expected profit late Tuesday, but revenue growth fell short of expectations. News Corp. (, Fortune 500) opens its books after the closing bell Wednesday. 

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Stocks surged last week to their highest levels in years, but there are few key economic reports slated for the week ahead to sustain the rally.

The big news last week was Friday’s report from the U.S. Labor Department, which showed a much larger-than-expected increase in hiring and a surprise drop in the unemployment rate.

Investors cheered the jobs data, which came on the heels of upbeat reports on auto sales, construction spending and manufacturing activity.

The Dow rose 1.6% last week, ending at its highest point since May 2008. The Nasdaq jumped 3.2% over the last five trading days, climbing to its highest level since December 2000, and the S&P 500 added 2.2%.

Next week, investors will take in reports on consumer sentiment and the nation’s trade balance, both coming on Friday.

On the corporate front, Dow stocks Coca-Cola (, Fortune 500), Cisco (, Fortune 500) and Disney (, Fortune 500) are scheduled to report quarterly results.

Given the lack of major economic reports next week and the market’s recent strength, some analysts say stocks are vulnerable to a sell off.

"The market is definitely due for a pullback," said Keith Springer, president of Springer Financial Advisors in Sacramento, Calif. "But so many people have been waiting for one that it might not come until the market is much higher."

Meanwhile, the focus next week could shift back to the debt crisis in Europe, where talks in Greece over a debt write down and a second bailout appear to be coming to a head.

Concerns about a hard landing in China may also be top of mind next week, with reports due on consumer prices and foreign trade due out.

"Next week, I think the trade will continue to monitor the Greek debt restructuring, while watching the Chinese inflation and trade data," said Nick Kalivas, market strategist at Hadrian Partners.

Greece appears close to a deal with its private sector creditors to write down a portion of the nation’s debts. The deal has been held up for weeks by disagreements over how much of a loss investors would voluntarily accept on Greek bonds.

Kiss QE3 hopes goodbye. And good riddance!

At the same time, there are concerns that political wrangling in Athens over more budget cuts could delay a second bailout, which is now expected to total €145 billion, up from the previously estimated €130 billion.

There is also widespread speculation that Greece will not meet its mandated fiscal targets unless its "official" creditors, such as the European Central bank, take part in the restructuring.

The ECB is expected to hold interest rates steady at its regularly scheduled policy meeting and press conference on Thursday. 

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The European Central Bank is considering using its bond holdings to bolster Greece

Alberici Corp. said today it has bought a Topeka, Kan.-based company that specializes in building water treatment facilities using the design-build method.

Terms of Alberici’s deal to buy CAS Construction LLC were not released. Mike Burke, executive vice president of Alberici, said in a statement the acquisition provides Alberici with additional design-build capabilities and the ability to reach new customers and markets.

Alberici and CAS began working together three years ago, when they teamed with engineering firm Burns & McDonnell on the $73 million aquifer recharge system for the city of Wichita, Kan.

Mike Hafling, president of CAS, and other senior managers will remain with the company, which has been renamed CAS Constructors. LLC. Charles A. Stryker founded the company in 1985 and managed the business until his death in 2006.

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The number of Americans signing contracts to buy previously owned homes in December held near a 19-month high, showing the stabilization in the market that began in late 2011 will extend into the new year.

The index of pending home sales decreased 3.5 percent last month after jumping a combined 18 percent in October and November, figures from the National Association of Realtors showed today in Washington. It was the best back-to-back reading since a buyer tax credit boosted demand in early 2010.

Wall Street opened higher Wednesday following reports that the International Monetary Fund could get more cash to help countries struggling to manage their debt.

The Dow Jones industrial average is up 43 points at 12,483 after the first half-hour of trading. That’s an increase of 0.4 percent. Bank of America Corp. and JPMorgan Chase & Co. are the Dow’s leading stocks. BofA rose 2.6 percent, JPMorgan 2 percent.

Goldman Sachs Group Inc. jumped 3.5 percent after the investment bank reported earnings that trumped analysts’ expectations. Profit still sank 58 percent in the last three months of 2011, a result of sinking interest rates and volatile financial markets.

Other financial stocks were sharply lower. State Street Corp. dropped 6.5 percent.

Christine Lagarde, the IMF’s managing director, said Tuesday that the fund was looking at ways to increase the amount it can lend to countries, partly to deal with Europe’s debt crisis.

The S&P 500 index is up 5 points to 1,298. The Nasdaq is up 16 points, or 0.6 percent, to 2,744.

Yahoo Inc. rose 2 no credit check payday loans.5 percent on news that co-founder Jerry Yang is leaving the struggling Internet company. The departure clears the way for newly hired CEO Scott Thompson to take more radical action to shake up the company.

The Federal Reserve said manufacturing rose 0.9 percent in December, the biggest increase since December 2010. Output surged as companies bought more machines and materials.

Among other stocks making large moves Wednesday:

_ Amphenol Corp. soared 10 percent, the largest gain in the S&P 500. The manufacturer of fiber optic cables reported earnings that beat analysts’ expectations.

_ Linear Technology Corp. jumped 8.3 percent. The Milpitas, Calif.-based circuit maker said it expects revenue to rise between 4 and 8 percent in its third quarter following strong order increases in December and January. It also raised its dividend by a penny to 25 cents per share.

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One in eight people earning at least $1 million annually was audited by the Internal Revenue Service last year, making them far likelier to be examined than those making below $200,000, according to IRS data released Thursday.

Just 1 in 100 individuals earning less than $200,000 had their income tax returns examined, the IRS said.

The 12 percent of millionaire earners audited in 2011 was appreciably higher than the 8 percent who were audited in 2010. IRS officials said the high ratio was part of an effort to demonstrate that tax laws are applied fairly.

“That has been something we’ve concentrated on to assure that there’s equity in the system, to assure that those at the lower end of the spectrum know that those at the higher end of the spectrum are subject to the same rules and enforcement as everyone else,” Steven Miller, deputy IRS commissioner for services and enforcement, said in an interview.

In recent weeks, President Barack Obama and congressional Democrats have sought to boost taxes on the wealthy as a way to pay for jobs programs, a theme they are expected to continue in this presidential and congressional election year. IRS spokeswoman Michelle Eldridge said the growing portion of millionaire earners’ returns audited is not related to politics.

“The IRS is an agency of civil servants, and we base our audit decisions on tax issues _ nothing else. We don’t play politics here,” she said.

Between 2004 and 2009, the percentage of millionaire earners audited ranged between 5 percent and 7 percent.

The data was divided into only three categories of income: below $200,000, $200,000 and up, and $1 million and higher.

About 1 in 25 people earning $200,000 and more was audited in 2011.

The IRS also audited a greater proportion of large corporations than smaller ones, the data shows.

Last year, 1 percent of corporations with assets under $10 million were audited. Among corporations with assets of $250 million and up, 28 percent were audited.

The IRS said its enforcement efforts to collect all taxes owed _ which include audits, court cases and other activities _ netted $55 billion last year. That is nearly $3 billion less than the previous year, which Miller attributed to a falloff in estate taxes and corporations writing off their losses.

All together, the IRS audited nearly 1.6 million of the 141 million individual income tax returns that were filed. In 2010 _ the most recent year available _ more than 8 in 10 individuals audited ended up paying additional taxes.

The agency collected a total of $2.3 trillion in revenue last year from individuals and businesses, including the $55 billion from its enforcement efforts.

The IRS figures also showed that:

_In 2011, the agency garnisheed wages or seized money from bank accounts 3.7 million times, put liens on property 1 million times and seized 776 pieces of property.

_77 percent of individual returns were filed electronically last year, up from 69 percent in 2010.

_70 percent of callers to IRS taxpayer information telephone lines got through, slightly less than the 74 percent who reached someone in 2010. Miller attributed that to budget cuts to the agency.

_The information IRS officials dispensed over the phone to taxpayers was accurate 93 percent of the time, the same as the previous year.

_The IRS website, http://www.irs.gov, was visited 319 million times in 2011, a slight increase.

The data was presented by federal fiscal years, which begin on the previous Oct. 1.

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In a Dec. 30 story about iceberg lettuce being removed from grocery stores after salmonella was found in an Arizona field adjacent to the grower’s property, The Associated Press, relying on information from Kroger and its affiliated Smith’s Food and Drug, erroneously reported the lettuce had been removed from stores in North Carolina, among at least six other states. Kroger said Saturday the product never made it to its North Carolina stores.

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Global stock markets were mixed Friday on 2011’s last trading day and turned in heavy losses for the year after Europe’s debt crisis and natural disasters battered a struggling global economy. Japan’s benchmark hit its lowest close in three decades.

Benchmark oil hovered below $100 per barrel and the dollar weakened against the yen but rose against the euro.

Asian traders recorded gains for the day Friday but markets in Tokyo, Shanghai and Hong Kong ended the year with double-digit losses.

Japan’s Nikkei 225 index, after three straight days of losses, rose 0.4 percent to 8,429.45, but it was the lowest closing since 1982. China’s benchmark gained 1.2 percent to close at 2,199.42 _ still, a 20 percent loss for the year.

European shares were steady or slightly down in early trading. Britain’s FTSE 100 lost 0.2 percent at 5,555.92. Germany’s DAX was marginally down at 5,846.35 and France’s CAC-40 was nearly unchanged at 3,127.34.

Wall Street appeared headed for a lower closing, with Dow Jones industrial futures down 0.2 percent at 12,194 and S&P 500 futures slipping 0.2 percent to 1,255.40.

Hong Kong’s Hang Seng Index gained 0.2 percent to close at 18,434.39.

Australia’s benchmark S&P ASX 200 ended the year at 4,140.4 _ down 0.4 percent on the day and 14.5 percent lower for 2011. A day earlier, South Korea’s benchmark Kospi closed at 1,825.74 on Thursday _ 11 percent down on its last trading session of the year Thursday.

Analysts said global stocks tumbled in lockstep, suffering from the effects of natural disasters, a wobbly recovery in the U.S. _ and an escalating European debt crisis that has resisted repeated measures taken by the region’s governments and financial institutions.

“The big reason is Europe. Europe tried to muddle through without a real solution. They can save a small country like Greece, but they cannot save a big country like Italy. Two trillion euros in foreign debt _ nobody in the world has that kind of money,” said Francis Lun, managing director of Lyncean Holdings in Hong Kong.

“Europe will enter a lost decade, a decade of no solutions and no growth,” he said. “Maybe except in Germany, their machinery is still selling.”

Japan’s benchmark plunged after the March 11 tsunami and earthquake disaster that destroyed huge chunks of the island nation’s northeastern region, left 20,000 people dead or missing and set off the world’s worst nuclear crisis since Chernobyl.

Disaster damage extended to key suppliers for major companies like Toyota Motor Corp. and Sony Corp., which suffered production disruptions. The Thai flooding that followed caused similar problems for automakers, including Honda Motor Co., but on a smaller scale.

The Tokyo market also saw two big-name brands lose much of their value.

One was Tokyo Electric Power Co., the utility that runs Fukushima Dai-ichi nuclear power plant, where at least three reactors went into meltdown after tsunami destroyed backup generators to keep power going at the plant.

Some officials say TEPCO may have to be nationalized because of ballooning losses and the costs to bring the reactors under control and compensate victims.

Another was camera and medical equipment maker Olympus Corp., whose offices have been raided by criminal investigators after fabricated accounting to cover up massive investment losses came to light no fax payday loans.

A British executive, who has since resigned from the board, was first to draw attention to the dubious investments, and has become a celebrity figure raising questions about old-style Japanese management.

Across the board, Japanese companies have been slammed by the rising value of the yen, which erodes the value of revenue from exports.

The Nikkei lost nearly a fifth of its value over the past year. It nose-dived right after the disaster, recouped some of those losses in July, but then started a decline that has the benchmark hovering at below the March value.

China’s benchmark Shanghai Composite Index lost 21 percent in 2011 as the impact of Beijing’s multibillion-dollar stimulus faded and the government tightened curbs on lending and investment to cool blistering economic growth.

The flood of state spending and bank lending after the 2008 crisis fueled a surge in real estate and stock prices. In 2010, Beijing responded by clamping down on credit and real estate speculation to cool inflation and soaring housing prices.

Beijing is trying to steer growth to a more sustainable level after 2010’s explosive 10.3 percent expansion. Growth eased to 9.1 percent in the three months ending in September, down from 9.5 percent the previous quarter.

Chinese leaders have promised to ease credit to help exporters and smaller companies cope with falling global demand and weaker domestic growth. But they say most controls will remain in place. That has disappointed stock traders who are hoping for interest rate cuts and looser controls on bank lending. They have responded in recent weeks by dumping stocks and moving some money to U.S. and European markets.

The benchmark Hang Seng Index slipped in the second half of the year as concerns over Europe accelerated, sending it to a 2011 low in early October before bouncing slightly to end the year at a 20 percent loss.

Hong Kong is Chinese territory, but its financial markets are open to foreign companies and investors, which made it a popular destination this year for foreign companies looking to go public, drawn by the prospect of raising their brand profiles with China’s newly wealthy as growth flags in their home markets.

Italian fashion house Prada was one of the biggest names to list in Hong Kong, with an initial public offering in June that raised $2.5 billion, making it the sixth-biggest IPO globally this year, according to deal tracking service Dealogic.

Other foreign companies that took out primary or secondary listings in Hong Kong include MGM China Holdings Ltd., the Macau casino arm of MGM Resorts International, luggage maker Samsonite S.A. and U.S. luxury handbag maker Coach Inc. However, the slumping market means share prices for many companies that went public are ending the year lower than IPO price.

Benchmark crude for February delivery fell 28 cents to $99.37 a barrel in electronic trading on the New York Mercantile Exchange. The contract added 29 cents to settle at $99.65 in New York on Thursday.

In currency trading, the dollar fell to 77.58 yen from 77.65 yen late Thursday in New York. The euro fell to $1.2913 from $1.2939.

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Chinese industrial companies