Time Warner Cable's new management team laid out a rosy three year operating plan, aimed at winning new subscribers and fending off a take-over bid on the cheap.
CEO Rob Marcus and CFO Arthur Minson made numerous references to their "winning" plan, which it is hoped will add one million new customers over three years as part of a $3.7 billion long term investment.
"They see a chance to force a trade," said Minson referring to Charter Communications' attempt to acquire the cable operator at $132.50 per share.
CEO Marcus reiterated that they will not engage in talks at less than $100 in cash and a $60 in Charter shares and along with additional assurances. The stock opened at $133.44 and rose one percent by mid-morning trading, "If an offer were presented that exceeds the value we can create ourselves we'd be willing to negotiate," said Marcus.
Minson, who returned to Time Warner Cable after a stint at AOL said: "I'm a big believer in playing to win, I'm here to deliver on this plan." Many commentators believe a take-over of Time Warner Cable is inevitable if Charter is able to close on a deal that would have Comcast agreeing to acquire portions of Time Warner Cable in a subsequent deal.
If that happens, Charter may have more flexibility to increase its bid. Charter's major shareholder Liberty Media chairman, John Malone, is hoping to encourage consolidation in the cable industry to better fend off programming increases and improve technological innovation.
Charter CEO Tom Rutledge is vying to run the combined entity and presented investors with own vision of a better run Time Warner Cable.
Part of the Marcus plan, articulated Thursday morning, involves gaining marketshare versus two major competitors, AT&T's UVerse, primarily on the West Coast and Verizon's FiOs on the East Coast.
While Time Warner Cable again lost video subscribers, 217,00 in the fourth quarter, the losses were lower than in the prior quarter. For the year, Time Warner Cable lost a stunning 825,000 customers overall.
Fourth quarter earnings came in better than expected. The Manhattan-headquartered cable operator reporting adjusted earnings per share of $1.82 versus analysts estimates for $1.73.
Profit rose 5.3 percent to $540 million while revenue for the fourth quarter period was in line at $5.6 billion. Time Warner Cable also raised its annual dividend by 15 percent to $3.
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