Vivendi Q4 Earnings Rise; UMG Down 7.1%
February 29, 2008 at 5:28 AM (PT)
VIVENDI SA, owner of the world's largest music company, said fourth-quarter earnings rose 16% on subscriber gains at its MOROCCAN telephone company and lower costs at the CANAL PLUS pay-television unit. Profit excluding one-time gains and some costs, which VIVENDI calls adjusted net income, rose to 585 million euros ($888 million) from 505 million euros a year earlier, the PARIS- based company said in a statement today. Earnings at mobile-phone unit SFR and UNIVERSAL MUSIC GROUP, VIVENDI's biggest businesses, fell more than analysts had estimated.
VIVENDI stepped up the pace of takeovers last year, buying BMG MUSIC PUBLISHING GROUP in JULY. In JANUARY, VIVENDI said fourth-quarter sales rose 8.5%. That was after VIVENDI reported its first profit drop in seven quarters in the third quarter, hurt by falling music sales at UNIVERSAL MUSIC GROUP and the dollar's drop against the euro.
UNIVERSAL MUSIC has suffered from declining CD sales and the dollar's slide. Profit in the quarter slipped 7.1% to 289 million euros, more than the 4.5% drop that analysts estimated.
VIVENDI plans to become less reliant on CD sales. It started an Internet service called ZAOZA this month that offers unlimited downloads of games, videos and music for mobile phones and computers for a monthly subscription fee of about 5 euros.
The company agreed in DECEMBER with NOKIA OYJ to offer a year of unlimited downloads with each handset. UNIVERSAL MUSIC also agreed to make its songs available for free on social- networking site IMEEM in exchange for advertising revenue.