Vivendi Reports 41 Percent Jump In 1Q Profit
Posted: May 17, 2006
PARIS (AP) -- Vivendi SA rejected a proposal from a top shareholder to break up the company as it reported Wednesday that its first-quarter net profit rose 41 percent on strong growth at its music and games businesses.The media and telecommunications company said the proposal came from Sebastian Holdings, an investment fund that has recently become Vivendi's largest individual shareholder by reportedly acquiring 4 percent.
ADVERTISEMENT
Vivendi said its supervisory and management boards rejected the proposal, calling it "unrealistic" on economic and legal grounds. The company earned 707 million euros ($906 million) in the first quarter, up from 501 million euros a year earlier. Analysts surveyed by Dow Jones Newswires had expected net profit of 561 million euros ($719 million). Vivendi said it expects adjusted net profit to grow by 16 percent to about 2.4 billion euros ($3.1 billion) this year, compared to previous guidance of between 11-13 percent. Adjusted net profit excludes charges like impairment of goodwill and income from discontinued operations. Operating profit rose to 990 million euros ($1.27 billion), from 921 million euros in the first quarter last year. The Universal Music Group, one of the world largest by sales, reported that operating profit more than doubled to 90 million euros ($115 million) from 38 million euros, in part behind significant growth in digital revenues. Bestsellers in the quarter were new album releases from Andrea Bocelli, Jack Johnson and Prince. Vivendi says it is looking for acquisitions in music publishing. Operating profit at Vivendi's video games unit, which had been up for sale a couple of years ago, more than doubled to 23 million euros ($29 million), boosted by the success of the title World of Warcraft. But operating earnings at Vivendi's pay TV unit Canal Plus Group tumbled 75 percent to 33 million euros ($42 million) due to extra costs linked to a new French soccer league broadcasting contract. Canal Plus is awaiting regulator approval to merge with pay-TV rival TPS, currently owned by rivals Television Francaise 1 SA and M6 Metropole Television. Shares of Vivendi jumped 4.6 percent to 29.08 euros ($37.27) in Paris trading. |
E-mail This Article to a Friend
Print This Article
Tell Us What You Think
