Time Warner Inc.'s net income more than doubled in the first quarter, driven by a gain from the sale of its music company, strong results from film and TV and improved profitability at America Online.

Time Warner Inc.'s net income more than doubled in the first quarter, driven by a gain from the sale of its music company, strong results from film and TV and improved profitability at America Online.

The world's largest media company posted net earnings of $961 million Wednesday, compared with $396 million in the same period a year ago. Revenues rose 9% to $10.1 billion from $9.24 billion.

The results include $215 million in income from discontinued businesses, mainly tax benefits related to the sale of its music business, Warner Music Group, last month for $2.6 billion.

Excluding the effects of an accounting charge and discontinued operations, the earnings were equivalent to 15 cents per share, well ahead of the 9 cents per share that analysts surveyed by Thomson First Call had been expecting. In the comparable period a year ago, the company earned 10 cents per share.

Chief executive Dick Parsons told investors on a conference call that the results beat the company's expectations. "Simply put, we had a great quarter," Parsons said.

Parsons has been shedding assets, paring down debt and focusing on the company's core businesses in a long-term effort to regain investors' trust following the debacle of Time Warner's 2001 merger with AOL.

Time Warner has reduced its net debt to $18.8 billion, down from $22.7 billion at the end of 2003 -- meaning the company met its debt reduction targets a year ahead of schedule.

AOL's revenues edged slightly lower to $2.19 billion from $2.20 billion in the same quarter a year ago, but operating income rose 21 percent on lower costs and better results from its European operation.

Don Logan, the head of Time Warner's subscription-based businesses including cable TV, magazines and AOL, voiced optimism about the improvement in AOL's results but acknowledged that "we still have a lot of hard work ahead of us. ... The organization is clearly much stronger today than it was a year ago."

Parsons said on the call that he believed AOL was "re-catching its stride" and "undervalued in the market."

"We think it's headed in the right direction," Parsons said.

In the aftermath of the merger debacle, Time Warner has stripped 'AOL' from its name, removed AOL executives from top management positions and downgraded the Internet business to an operating unit from an equal management partner in the company.

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