Drop due to sliding sales, falling dollar
Profit at Vivendi, owner of Universal Music, plunged in the third quarter due to sliding sales of CDs, the dollar’s drop against the euro and a tough comparison to last year, when profits were boosted by sale of a stake in Veolia Environment.Profit fell to 578 million euros ($847 million) from $2.29 billion in the year-ago period. It was Vivendi’s first profit decline in seven quarters. Profits also fell slightly using a measure that Vivendi calls adjusted net income, which excludes one-time gains, such as the sale of the Veolia stake, and some costs. Adjusted net income fell 1.4% to $1.06 billion. Universal Music said profit fell 17%, as music downloads failed to make up for sliding CD sales. Sales in the unit rose 6.8% to $1.7 billion, lifted by the purchase of BMG Music Publishing Group, which Vivendi bought in May. Vivendi revamped its pay-TV unit in January as Canal Plus combined with smaller competitor Television Par Satellite. In the third quarter, Canal Plus posted a 40% jump in profit to $303 million, boosted by the inclusion of TPS. Vivendi Games, whose World of Warcraft game is played by more than 9 million people worldwide, lifted earnings 71% $60.1 million. Vivendi’s stake in NBC Universal produced less income due to the falling value of the dollar against the euro.