- The Washington Times - Thursday, January 30, 2003

From combined dispatches
NEW YORK Ted Turner, AOL Time Warner Inc.'s vice chairman and largest individual shareholder, resigned after the world's largest media company posted a $98.7 billion loss for 2002, the biggest in U.S. corporate history.
The New York company posted the loss after taking a $45.5 billion write-down in the fourth quarter because of a decline in value of its America Online unit and cable systems.
Mr. Turner, who pioneered cable television and built CNN before selling it to Time Warner in 1996, will leave in May, Chief Executive Officer Richard Parsons told investors on a conference call.
"Dick Parsons anticipates that Ted will remain on the board. The two talk frequently," said spokeswoman Tricia Primrose. Mr. Turner hasn't made his decision public, she said.
Mr. Turner, 64, told Mr. Parsons on Tuesday night that he would resign, Mr. Parsons said.
"I have not come to this decision lightly," Mr. Turner said in a letter to Mr. Parsons. "As you know, this company has been a significant part of my life for over 50 years. I have the deepest respect for you, the senior management and my fellow members of the board. With this team in place, I am optimistic that the company will be able to move forward and reach its true potential."
Mr. Turner's exit coincides with the pending departure of Chairman Steve Case, the America Online co-founder, putting the disparate histories of AOL Time Warner's divisions even further into the past as the mammoth company plots its turnaround.
The $45.5 billion write-down, more than twice what analysts estimated, contributed to a 2002 loss of $98.7 billion. AOL Time Warner already reduced the value of acquired assets by $54.2 billion in the first quarter of 2002. The write-downs are non-cash expenses and reflect the company's declining value after America Online Inc. bought Time Warner Inc. two years ago.
"Overall, it looks like a terrible earnings report," said Doug Kass, a hedge fund manager at Seabreeze Partners LP. Mr. Kass said the fund has a "small short" position on AOL Time Warner, meaning it is betting the stock will fall.
The fourth-quarter net loss widened to $44.9 billion ($10.04 a share) from $1.83 billion (41 cents) a year earlier. Sales rose nearly 10 percent to $11.4 billion from $10.4 billion.
The announcements were made after the markets closed. AOL stock closed higher, up 30 cents per share at $13.96 on the New York Stock Exchange. The shares dropped nearly 10 percent early in the extended session.
Profit before the write-down, amortization and other non-cash expenses was 28 cents a share, above the average forecast of 26 cents from analysts polled by research firm Thomson First Call.
The America Online division, based in Sterling, Va., was the only one of the company's six units to report lower earnings before interest, taxes, depreciation and amortization in the fourth quarter. Of the $45.5 billion write-down, $33.5 billion was for America Online, the company said.
AOL, which was garnering 1 million or more new online subscribers every quarter in its heyday of the late 1990s, lost 176,000 U.S. members during the fourth quarter. AOL's worldwide membership fell for the first time in its history, from an estimated 35.3 million members at the end of September to 35.2 million at the end of December.
The company's stock has fallen 78 percent since America Online announced its $124 billion purchase of Time Warner in January 2000, which could be considered the crowning moment of the Internet boom.

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