Operating profit for media arm rose 7%
PARIS — Hit by the e42 million ($55.3 million) cost of restructuring its press division, media profits at France’s Lagardere group fell 36.6% to $353 million in 2006 on revenues up 2.4% to $10.65 billion.
Factoring in the group’s 15% stake in EADS, parent company of troubled Airbus, profits declined even more steeply, down 56.6% to $382.8 million on revenues up 7.6% to $18 billion.
However, operating profit for Lagardere’s media arm rose 7% to $710.8 million. The company said it would pay out a dividend of $1.58 a share, up from the previous year’s $1.45.
Unveiling the figures Monday in Paris, topper Arnaud Lagardere said the dividend reflected the company’s “sound financial health and (our) confidence in our future performances.”
Positioning himself as another potential suitor for Telefonica’s reality giant Endemol, Lagardere said he had not ruled out making a bid, although he considered it “very expensive.”
Lagardere recently combined its magazine publishing and TV activities in a single division, Lagardere Active Media, but Monday’s figures broke down the company’s media activities.
Book publishing posted a 16.6% hike in operating profit to $290 million; Lagardere’s retail division was up by 8.4% to $152.9 million; while Lagardere Active, the company’s TV arm, saw operating profit rise to $93.6 million from $61.9 million in 2005, despite investments of $25 million in digital terrestrial channels.
However the company’s mag division, publisher of titles such as Elle and Car & Driver, saw an 18.5% decline to $243.9 million, due to falling sales of print titles and increased investments in Internet.
In the U.S., Woman’s Day and various automobile, decoration and men’s magazines performed poorly, Lagardere said.
Lagardere said he had no plans to sell the EADS stake, saying he would not “leave a ship in difficulty,” but he was not in favor of injecting more cash.