With 140 magazines worldwide, Time Inc. is well positioned across the most popular consumer magazine sectors—news, sports, celebrity, fashion, women’s lifestyle, business, personal finance, entertainment, shelter, epicurean and regional. In 2004, one in two U.S. adults read a Time Inc. magazine every month. Over that same year, 60% of adults in the U.K. read a magazine published by Time Inc.’s IPC Media, the U.K.’s largest consumer magazine company.

Time Inc.’s strong 2004 financial performance reflected solid growth in advertising revenues. Time Inc. magazines accounted for nearly a quarter of the advertising revenue of all U.S. consumer magazines. People ranked first in advertising revenue among domestic magazines for the 14th straight year, while Sports Illustrated and Time were second and fourth, respectively. Overall, eight of the top 30 magazines in advertising revenue were Time Inc. titles.

Innovation has been a key to Time Inc.’s success. Five of its 10 most profitable magazines were launched in the last 15 years. Real Simple is the most recent example of this phenomenon, having turned profitable in just over three years after it was first published in 2000.

In the decade prior to 2004, Time Inc. launched six successful magazines. In 2004 alone, the company launched four new titles:

	Nuts, a weekly general interest title from IPC for men in the U.K.;
	All You, a monthly women’s magazine with circulation of 500,000, distributed initially in Wal-Mart’s approximately 3,000 stores nationwide;
	Cottage Living, a monthly national lifestyle magazine from Southern Progress Corporation; and
	Life, which has returned as a weekend magazine distributed in the U.S. in newspapers nationwide, with a total circulation of more than 12 million.

Early in 2005, Time Inc. acquired the portion of Essence Communications Partners (ECP), the joint venture between Time Inc. and ECI Holdings, that it didn’t already own. ECP publishes Essence, the preeminent women’s lifestyle magazine that reaches over 6 million African-American adult readers each month.

This acquisition—like Time Inc.’s acquisitions of IPC, Time4 Media (the publisher of enthusiast magazines) and Synapse (the magazine subscription marketer)—is expected to contribute meaningfully to Time Inc.’s financial performance, underscoring the company’s ability to successfully add new businesses.

In 2005, Time Inc.’s strategy will continue to be built around a formula that has served it well: ongoing excellence and reinvention of its core magazine brands, seamless management of acquisitions, an ongoing cost management program and the launch of new magazines.

Another Time Inc. business—Time Warner Book Group—placed a record 58 titles from its Warner Books, Little, Brown and Company, and Warner Faith imprints on the New York Times Best Seller list in 2004, with 16 of them ranked #1. Jon Stewart’s best-selling America (The Book) was named the 2004 Publishers Weekly Book of the Year. The 2004 results also benefited from Joel Osteen’s Your Best Life Now and significant backlist sales of Nicholas Sparks’ best seller The Notebook, which became a successful New Line Cinema major motion picture.