Drop due to comparison to same quarter last year
Vivendi Universal’s third-quarter net profit fell 35% to e647 million ($759.6 million), but quarterly operating profits were stronger than expected, up 11% to $1.2 billion thanks to strong performances in music and games, the company said Thursday.
The anticipated sharp drop in profit was due to a comparison to the same quarter last year, when Viv U posted a one-off tax gain that distorted its figures.
Universal Music’s profit rose 65% to $83.3 million, higher than expected, due to lower operating costs and a cut in restructuring expenses offsetting lower sales.
The hit vidgame “World of Warcraft” drove Vivendi Universal Games to a profit of $8.2 million, from a $37.5 million loss in the same period last year.
Gallic paybox Canal Plus Group provided more upbeat news, its third-quarter earnings up 4%, higher than best estimates, at $113.8 million. Increase was due to strong subscriber growth driven, according to Vivendi, by a hefty investment in French premium soccer.
Viv U’s SFR mobile telco, its biggest single earner, saw a slowdown in profit growth, up just 7%, compared with 16% in the previous quarter, to $812.6 million. However its Moroccan telco Maroc Telecom posted a 15% profit hike to $263 million.
Total group profits for the first nine months stood at $2.24 billion, up 3% , on revenues of $16.4 billion, an increase of 8% on the same period last year.
Having turned the corner after its brush with bankruptcy three years ago, Viv U topper Jean Bernard Levy said talks were proceeding well with Lagardere Group, which is negotiating to swap its stake in CanalSat, Canal Plus’ digital platform, for a smaller stake in the whole of the Canal Plus Group, which also owns the flagship French channel.
Paybox recently won a court case allowing it to bundle the two pay TV services, a commercial move that had been challenged by rival TPS.