Pay TV, video games drive big Vivendi Q1

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French media giant Vivendi saw a 32% jump in its first-quarter profit to €932 million ($1.27 billion) and a 22.8% increase in operating profit to €771 million ($1.05 billion), driven mainly by its pay TV and video games units, the company reported last week (HR 5/16).

Revenue totaled €5 billion ($6.8 billion), an increase of 5.3% compared with the year-ago quarter, and adjusted earnings before interest and income taxes rose 21.7% to €1.3 billion ($1.8 billion).

Vivendi boasted "very good first-quarter 2007 earnings," with the group particularly lauding the successful launch of its "World of Warcraft: The Burning Crusade" video game, fewer days of airing French football Ligue 1 and the first positive effects of the Canal Plus–TPS satellite TV merger.

A profit decline from the group's affiliate NBC Universal, which Vivendi attributed solely to the decline of the U.S. dollar, was offset by an increase in income at Neuf Cegetel.

Based on its results, Vivendi reiterated its financial goals for the full year.

Analysts generally lauded the results, with UBS analyst Ian Whittaker calling it a "blowout quarter." While "music was slightly weaker" than expected, "the positives from other divisions more than offset this," he said.

Universal Music Group's revenue of €1.03 billion ($1.4 billion) dropped 8.7% compared with the same period last year because of poor sales in the U.S., Japan and France. However, U.K. sales were off the charts.

Canal Plus Group reported revenue of €1.07 billion, up 18.7% compared with the first quarter of 2006.

Vivendi Games' revenue of €291 million ($395.5 million) was 117.2% higher than last year.
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