MEDIA: Headliner - Time Warner chief confounds shareholders and Wall Street.

To underestimate Richard D Parsons is to risk being very wrong, Alasdair Reid writes.

Richard D Parsons is one of those larger-than-life characters you instantly think you recognise and understand because you've seen their fictional equivalents on telly. The West Wing, say, or LA Law, if it had been set in Ally McBeal territory on the East Coast.

Parsons is one of the most powerful men in corporate America, a hotshot lawyer and one of the country's most prominent African-Americans who first made his name as a White House adviser. He's a fully paid-up member of New York's great and good, a man who subscribes to all sorts of worthy causes and who is a ferocious patron of the arts.

Last week, though, was probably as memorable as any in his diverse career as he pulled off one of the most improbable conjuring acts in recent corporate history - he was able to announce that Time Warner, the company of which he is both chairman and chief executive, has delivered a profit of dollars 2.6 billion for the calendar year 2003.

Which is nothing short of astonishing really, even though Parsons had told analysts months ago to expect good news. The background has been well-rehearsed - Time Warner's dollars 284 billion merger with AOL, a mere internet service provider (albeit the biggest in the world) whose sense of its own importance had inflated in line with its share price in the crazy days of the dotcom bubble.

The merger in 2000 turned out to be one of the most expensive mistakes ever. The value of the AOL part of the business dribbled away and morale sank as accounting irregularities emerged and the division became mired in a Securities and Exchange Commission investigation. Last year, the sprawling conglomerate (still called AOL Time Warner at this point) posted the largest ever losses in corporate history - just short of dollars 100 billion.

As the heads rolled (the chief executive, Gerald Levin, and the chairman, Steve Case, within weeks of each other in 2002), Parsons, who is 56 this year, managed to keep his, taking first the chief executive role and then, in May last year, becoming the chairman too. The business press was sceptical, hinting that he had reached the top more by luck than judgment. They said he was a genial, well-connected corporate diplomat but no visionary. And, the implication was, no saviour.