The No. 2 cable operator just stepped up its effort to resist Charter Communication’s $61.3B (including debt) takeover offer by raising the quarterly dividend by 15% to 75 cents a share — and reporting Q4 earnings that appear to top analyst forecasts, even with weak results for video. time-warner-cable-logo__130821213653-275x126“We are geared up to manage this company for the long haul,” CEO Rob Marcus says. TWC’s net income of $540M is up 5.1% vs the Q4 number in 2012, on revenues of $5.58B, +1.7%. The revenue number is just slightly ahead of the $5.56B that the Street anticipated. Earnings per share at $1.89 topped predictions for $1.73. TWC 1TWC says that revenue per customer grew 2.2% to $106.03 with big gains in its broadband service where the number was up 12.4% to $46.21. Revenues for the Internet business rose 13.7% to $1.53B. But that had to offset the continuing decline in video, which continued to be hurt by last summer’s month-long dispute with CBS. TWC lost 217,000 TV subscribers, bringing its total down to 11.2M. In addition, the unit lost about $15M due to subscriber credits for Showtime customers who lost the channel during the CBS fight, along with lower VOD sales. Revenues for video fell 5.6% to $2.69B. Programming costs rose 7.7% vs the period last year to $33.70 per month for each subscriber.

In slides prepared for a conference call with analysts this morning, TWC takes on Charter’s main argument: that the cable company is in decline. TWC says that it is “well positioned to continue generating strong operating results and financial returns” with a three-year plan to improve reliability, differentiate its products, and invest “with an eye toward the future” even as it exercises “disciplined cost management.” Marcus, who became CEO at the beginning of this month, plans to increase capital expenditures by as much as $3.8B a year to improve infrastructure and go all-digital. He forecasts that revenues will grow an average of 5.4% a year through 2016, with cash flow rising 5.7%, giving TWC about $12B that could go to dividends, share repurchases and “strategic M&A opportunities” — suggesting that the company might be a buyer instead of a seller. “We have the right team and a strategic plan to deliver strong long-term, sustainable results,” TWC says.

Here’s how the Q4 results look:

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TWC 3a