Studiocanal, Universal Music Group Boost Vivendi Earnings
'Paddington' and 'Legend' set records for the studio, while streaming revenues from Taylor Swift and Sam Smith boosted Universal Music Group.
Studiocanal and Universal Music Group boosted Vivendi’s results in the first nine months of year, as the French conglomerate continues its transformation into a global media and entertainment company.
Turnover increased by 1.4 percent, assuming constant currency, to $81.3 billion (€7.6 billion). Adjusted operating profit declined to $786 million (€735 million), down 4.5 percent at constant currency, and adjusted net income grew 13.4 percent to $536 million (€501 million).
Studiocanal’s revenues “grew significantly” — up 12.9 percent — on the strength of its string of hits, including carryover from last year’s Paddington and The Imitation Game, and the recent release of Tom Hardy’s Legend, which broke U.K. box office records upon its release. Legend is so far Studiocanal’s biggest U.K. opening of all time, and that’s following the blockbuster success of Paddington, which spent 11 weeks in the top spot and earned more than $250 million worldwide.
Revenues were up 2.1 percent at UMG, and the strength of its streaming hit a good note for the music business. The group cited growth across all divisions, including a huge 33 percent jump in revenues from subscription and streaming services and said the strength of streaming “more than offset the decline [in] both digital download and physical sales.” Publishing revenues were also boosted by the streaming category.
Best-sellers were carryovers from earlier in the year, including Taylor Swift and Sam Smith, and the new Maroon 5, Drake and The Weeknd records, and the Fifty Shades of Grey soundtrack.
CanalPlus Group revenues were up less than one percent. Subscriptions to the pay-TV service were up on the strength of its international expansion in Africa, with a year-on-year increase of 619,000 to 15.4 million subscriptions. Though it didn’t give a number breakdown for France, subscription revenue was down 1.9 percent “due to a decline in the committed subscriber base.” This is a particular blow to the company, which had hoped that new subscriptions for the Rugby World Cup this fall would boost its numbers.
Vivendi paid lip service to the massive shakeup in the group that took place over the summer, saying the executive purge and controversy that followed is one of “several initiatives [that] have been taken to redress the economic situation of the group’s premium offers in France.” It will “further introduce a more international perspective into the Group’s activities, notably by using Dailymotion,” it said.
Vivendi acquired YouTube’s closest competitor in June.
Vivendi also said it will continue its recent acquisition of large chunks of video game makers’ Ubisoft and Gameloft stock, which has been opposed by the companies themselves.
After the sale of many of its mobile phone carrier assets last year, Vivendi has been funding acquisitions as it transitions itself into a media company. It acquired 26.2 percent of the forthcoming production and distribution company, which will be formed following the merger of Banijay Group and Zodiak Media, set to be completed in the first half of 2016. It said it plans to invest in the new company to create scripted and non-scripted programming for international television and multimedia platforms.
It also acquired 30 percent of French production company Mars Films and created the new U.K. production company Guilty Party to work under the Studiocanal banner.