MUMBAI: For the third quarter ended 30 September, the media and entertainment conglomerate Time Warner recorded a net income of $499 million. The result showed an 8 per cent dip in profits.

The revenues for the quarter was $9.97 billion, up from $9.5 billion one year earlier. The company has established a $ 500 million reserve related to ongoing accounting investigation at AOL.

The investigation by Securities and Exchange Commission and the Justice Department are on various accounting issues at American Online and related to its interest in AOL Europe before January 2002, when the company acquired Bertelsmann's 80 per cent stake in the venture, as stated in media reports.

Following an internal review of the accounting matters related to AOL Europe, the company has decided to restate its financial results for 2000 and 2001. According to media reports, this could deepen 2001 net losses by $ 855 million and 2000 net losses by $308 million.

At AOL, revenues were up 1 per cent to $2.1 billion, while operating income climbed 74 per cent to $ 261 million. As of 20 September, AOL had 22.7 million domestic subscribers, a decline of 2 million from last year. Cable revenues rose 10 per cent to $2.1 billion with subscription revenues up 10 per cent and ad revenues up 11 per cent. Average monthly revenue per basic cable subscriber was also up, by 10 per cent to $76. Operating income increased by 11 percent to $438 million. Time Warner Cable ended the quarter with 10.9 million basic video cable subscribers, a 4.7 million digital video subscribers,informs the media reports.

The film and entertainment segment which constitutes Warner Brothers and New Line posted revenue increase of per cent to $ 2.5 billion and 4 per cent decrease in operating income to $ 12 million.

The gains made in the international theatrical revenues of Harry Potter and The Prisoner of Azkaban and Troy were offset by a decline in worldwide theatrical home video and television licensing revenues.

The company attributed that the decline on account of a difficult comparison to the prior year, which included the release of the home video The Lord Of The Rings: The Two Towers.

The cable and broadcast networks delivered 8 per cent revenue growth to $2.2 billion, with subscription, advertising and content revenues all recording increases. The operating income was up 13 per cent to $574 million, according to the media reports.