Canal Plus paves way for Vivendi

Subscriber gains pay off with 8% revenue surge in Q4

Entertainment and telecom conglomerate Vivendi SA on Wednesday reported a fourth-quarter revenue increase of 8.5%, or 10.5% when assuming constant currencies, boosted by its pay TV unit Canal Plus.

Revenue rose to 6 billion euros ($8.9 million). Full-year revenue rose 8%, or 9.7% at constant currencies, to 21.7 billion euros ($32.2 billion).

Under French disclosure rules, companies have to announce their quarterly revenue by a certain date. Vivendi will provide its profit or loss at a later date, but it reiterated that 2007 adjusted profit came in at about 2.8 billion euros ($4.2 billion).

Universal Music Group reported a 3.1% decline in quarterly revenue to 1.6 billion euros ($2.4 billion), or a 5% drop excluding acquisitions. But revenue rose 2.4% at constant currencies. The quarter's key sellers were Mary J. Blige, Eagles and Andrea Bocelli.

UMG's full-year revenue declined 1.7% to nearly 4.9 billion euros ($7.3 billion), but rose 3% at constant currencies when including acquisitions. Digital sales of 676 million euros ($1 billion) rose 51% and made up 14% of total revenue.

Last year put the "plus" in Canal Plus, with the Gallic pay TV giant boasting an 8% jump in revenue to 1.7 billion euros ($2.6 billion) driven by gains in subscriptions and advertising. The group recruited 715,000 subscribers in Metropolitan France, Africa and French overseas territories, a 4% increase from 2006 and the most new subscribers for Canal Plus networks in 20 years. Overall, 5.3 million people subscribed to Canal Plus' pay TV packages in 2007.

Canal Plus recorded a 10% jump in fourth-quarter revenue to 443 million euros ($655 million).

Vivendi Games revenue fell 7.4% in the fourth quarter, or 4.4.% at constant currencies, to 302  euros million ($448.7 million).

For the full year, the unit exceeded €1 billion for the first time by growing 26.6%, or 33.5% on a constant currency basis.

Popular subscription-based massively multiplayer online role-playing game "World of Warcraft" added 2 million users in 2007, bringing its total to more than 10 million.

In Paris, Vivendi shares declined 1.8% to 26.82 euros ($39.85). During the past year, the stock has traded from 25.01 euros - 33.04 euros.

Rebecca Leffler in Paris contributed to this report.
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